Canadian retailer Metro Inc has reported an increase in first-quarter profits as higher sales boosted margins.
Metro booked a 17.1% rise in net earnings to C$121.4m (US$121.1m) for the quarter to 22 December. Excluding profits from a foodservice asset it sold during the quarter, net earnings were up 11% at C$115m.
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EBITDA increased 4.8% to C$188.2m. Gross margins were 18.7%, compared to 18.4% a year ago.
Metro trimmed its depreciation, amortisation and net financial costs while it also saw sales increase. It posted a 2.7% rise in sales to C$2.7bn. Same-store sales were up 1.5% although Metro said the results included sales from the week before Christmas, which last year were part of its second quarter.
“We are pleased with our 2013 first-quarter results which were achieved in a challenging economic environment of very low food inflation, intensifying competition and cautious consumers. Our teams executed well on our business plans and we are confident that we can continue on our growth path in the coming quarters,” president and CEO Eric La Flèche said.
Metro has been the centre of market speculation that it could be on the look out for acquisitions after it raised C$479m in cash by selling some of its stake in Couche-Tard. Analysts have linked the group to a potential bid for Safeway’s Canadian stores.
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