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Canada's Loblaw Cos. Posts Q2 Profit Increase

TORONTO -- Loblaw Cos. Ltd., Canada's biggest supermarket chain, based here, said yesterday that its second-quarter profit jumped 7.1 percent, driven by sales at new stores.

The retailer said its net earnings for the quarter ended June 18 were $211 million, or 76 cents per share diluted, compared to $197 million, or 71 cents per share, in the prior-year period.

Sales rose 6 percent for the quarter to $6.4 billion. Loblaw noted that all its operating regions enjoyed growth, and said an increase of approximately 1.4 percent of its increase in sales was related to the consolidation of certain independent franchisees, which were required to be included in the unaudited interim period. Same-store sales growth was essentially flat.

Loblaw said it continues to take restructuring charges on a reorganization of its supply chain operations, which it previously announced. The plan includes shutting six warehouses in Ontario and Quebec and relocating to new distribution centers. Loblaw expects the work to be completed by the third quarter of 2007.

Loblaw operates more than 1,000 corporate and franchised stores throughout Canada.
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