UPDATE 2-Loblaw posts higher profit, details overhaul plan
April 30th, 2008 | by admin |(New throughout, changes to Ottawa from previous Toronto)
OTTAWA, April 30 (Reuters) - First-quarter profit at LoblawCos Ltd (L.TO: Quote, Profile, Research) increased nearly 15 percent, because of lowerrestructuring costs and bigger sales, Canada’s biggest grocersaid on Wednesday.
The company said it will stick with its price-choppingstrategy this year in a “very competitive environment” andexpects lower expenses and greater efficiency to help offsetthe impact of the price-cutting on margins. Sales are alsoexpected to continue growing.
Loblaw also outlined a five-point plan that it said signalsan acceleration in its turnaround efforts. Shares rose nearly 5percent to C$30.94 on the Toronto Stock Exchange.
For the period ended March 22, Loblaw said net earningsrose to C$62 million ($61.5 million), or 23 Canadian cents ashare, from C$54 million, or 20 Canadian cents a share, in thesame period last year.
The latest results include charges of 11 Canadian cents ashare, down from 26 Canadian cents a share a year earlier onbigger restructuring costs.
Analysts had expected earnings before exceptions of 34Canadian cents a share and revenue of C$6.49 billion, accordingto Reuters Estimates.
Revenue at Loblaw, which is majority owned by NorthAmerica’s biggest baker, George Weston Ltd (WN.TO: Quote, Profile, Research), was up2.8 percent at C$6.53 billion.
“The company performance in the first quarter waschallenging,” Executive Chairman Galen Weston said on aconference call.
