Metro's 1Q Profits Down After A&P Canada Purchase
MONTREAL -- Metro, Inc., Canada's third-biggest supermarket chain and the buyer of A&P Canada in July, posted lower first-quarter profit on Tuesday, due to rationalization and integration costs related to the purchase. The grocer reported earnings of C$32 million (US$27.8 million), or 28 Canadian cents a share, vs. of C$38.6 million (US$33.5 million), or 40 Canadian cents in the year-ago period.
"During the first quarter, we continued the evaluation of our integration and rationalization plan following the acquisition of A&P Canada," the company said in a statement. "We have identified three main lines, namely stores and distribution centers, common services, and implementing our information systems at A&P Canada. Regarding Ontario stores, we expect to convert some stores to different banners and to close a few others. We will also streamline both common services shared by Quebec and Ontario operations, and our distribution centers' operations."
The retailer incurred C$18.3 million (US$15.9 million) in charges connected with the A&P Canada acquisition for C$1.2 billion in cash (US$1.0 billion) and C$500 million (US$434.2 million) in shares. Metro expects to rack up integration costs of C$55 million over the next two fiscal years.
The company's first-quarter sales came to C$2.5 billion (US$2.2 billion), compared with C$1.45 billion (US$1.26 billion) last year. Its same-store sales grew 0.9 per cent from the year-ago period. Excluding the C$1.07 billion (US$928.9 million) jump in sales from the A&P Canada purchase, Metro's same-store sales increase would have been 0.5 percent.
Metro operates 579 stores in the provinces of Ontario and Quebec.
"During the first quarter, we continued the evaluation of our integration and rationalization plan following the acquisition of A&P Canada," the company said in a statement. "We have identified three main lines, namely stores and distribution centers, common services, and implementing our information systems at A&P Canada. Regarding Ontario stores, we expect to convert some stores to different banners and to close a few others. We will also streamline both common services shared by Quebec and Ontario operations, and our distribution centers' operations."
The retailer incurred C$18.3 million (US$15.9 million) in charges connected with the A&P Canada acquisition for C$1.2 billion in cash (US$1.0 billion) and C$500 million (US$434.2 million) in shares. Metro expects to rack up integration costs of C$55 million over the next two fiscal years.
The company's first-quarter sales came to C$2.5 billion (US$2.2 billion), compared with C$1.45 billion (US$1.26 billion) last year. Its same-store sales grew 0.9 per cent from the year-ago period. Excluding the C$1.07 billion (US$928.9 million) jump in sales from the A&P Canada purchase, Metro's same-store sales increase would have been 0.5 percent.
Metro operates 579 stores in the provinces of Ontario and Quebec.