Loblaw Sticking to Canadian-1st Approach
Continuing its momentum from 2024, Loblaw Cos. Ltd. has delivered strong financial and operational performance in its first quarter of 2025, which ended March 22.
Loblaw’s retail segment saw a 4.1% revenue increase, driven by a 2.2% rise in food same-store sales and a notable 17.4% surge in online sales. Delivery led growth in the online grocery channel.
In food retail, the company drove higher tonnage and basket growth while lapping its strongest quarter of last year. “Absolute sales grew 4%, reflecting our new store growth, while our food same-store sales momentum continues as same-store sales increased 2.2%,” said Loblaw CFO Richard Dufren during the company’s earning call.
Delivering against its plans to open approximately 80 new stores and 100 new clinics in 2025, the company brought hard-discount banners to five new communities and opened four new pharmacies with expanded clinics in Q1, as well as opening a second T&T Supermarket in downtown Toronto.
“Our hard-discount banner same-store sales performance continues to outperform our conventional stores, demonstrating the ongoing consumer focus on value,” said Dufren. “While the gap between hard discount and conventional has stabilized, the growth in hard discount continues to be significantly higher than conventional.”
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Adjusted diluted net earnings per share grew by 9.3% to CAN $1.88 in Q1, and on a GAAP basis, the company’s net earnings per share increased by 12.9%.
While the recently introduced tariffs and counter-tariffs didn’t have much of an impact on the company's Q1, tariff-related impacts are now starting to show up in shelf prices.
“Canadians have faced significant affordability headwinds over the past few years, and we understand these challenges," said Per Banque, Loblaw’s president and CEO, during the earnings call. "We are working diligently to keep prices as low as possible as tariffs begin to impact prices in the second quarter. We are actively collaborating with our suppliers to mitigate the impact of these tariffs wherever possible. We remain committed to supporting Canada.”
Banque also mentioned that Loblaw is committed to being transparent regarding items impacted by tariffs.
“We have implemented a T symbol to clearly indicate products that have had a direct imposed tariff impacting the price,” he said. “When tariffs are removed, they will be promptly removed from the price of the products.”
To alleviate the tariff situation, Loblaw has been seeking out Canadian growers and manufacturers for the products it sells. It has also joined a large European buying group to lower purchasing costs on select commodities that it would have typically purchased from the United States.
“Our investment in the future remains a priority as we continue to reinvest in the business to support growth and ongoing consistent financial performance,” said Banque.
Brampton, Ontario-based Loblaw Cos. Ltd. is the largest retailer and private-sector employer in Canada. The company’s network comprises more than 2,400 stores and national e-commerce options. Loblaw is No. 10 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America.
