Metro Posts Double-digit 3Q Net Earnings Rise

Metro Inc. has reported adjusted third-quarter net earnings of $147.4 million, up 16.0 percent from the year-ago period, and adjusted fully diluted net earnings per share of $1.46, a 18.7 percent increase. Sales were up 3.8 percent to $3.7 billion at the Canadian grocer, while same-store sales increased 1 percent.

“We are very pleased with our strong third-quarter results, which reflect our efficient merchandising programs, excellent cost control and strong execution by the Metro team,” said Eric R. La Flèche, president and CEO of the Montreal-based company, which operates in the provinces of Quebec and Ontario. “Despite increasing competition, we are confident that we can continue on our growth path.”

Sales in the third quarter and first 40 weeks of 2012 came to $3.7 billion and $9.1 billion, up 3.8 percent and 3.7 percent, respectively, compared with sales of $3,566.9 million and $8,746.9 million last year. During the quarter, Metro experienced what it termed “very modest inflation” that was lower than in the first two previous quarters.

Gross margins for the third quarter and the first 40 weeks of 2012 were 18.3 percent and 18.4 percent, respectively, up from 18.2 percent for each of the corresponding periods of 2011. Metro attributed the gains to its merchandising strategies and the performance of its Adonis stores, which sell Mediterranean food products.

Net earnings for the third quarter were $144.4 million, an 13.6 percent rise over the $127.1 million logged in the year-ago period. Fully diluted net earnings per share grew 16.3 percent to $1.43, from $1.23 last year. Excluding the non-recurring tax expense of $3.0 million, Metro’s adjusted net earnings were $147.4 million and its adjusted fully diluted net earnings per share were $1.46, for increases of 16 percent and 18.7 percent, respectively.

Net earnings for the first 40 weeks of 2012 reached $344.2 million, up 11.6 percent from $308.3 million last year. Fully diluted net earnings per share came to $3.38 versus $2.96 last year, a 14.2 percent rise. Excluding the non-recurring tax expense noted above, adjusted net earnings were $347.2 million and adjusted fully diluted net earnings per share were $3.41, resulting in respective 12.6 percent and 15.2 percent increases.