Loblaw, the Canadian retailer, saw first-quarter earnings jump by 73% during the first three months of the year, thanks to food inflation and tight cost control.

The company yesterday (5 May) booked net income of C$109m (US$92.5m) for the three months to 22 March, up sharply from the C$63m posted a year earlier.

Operating income climbed by almost 45%, reaching C$226m, with “strong” food sales helping turnover rise 2.9% to C$6.72bn.

Same-store sales were up 2.1%. Loblaw said it incurred costs of C$29m related to its investment in IT and its supply chain, spending that hit basic net earnings per common share by C$0.05.

Nevertheless, the retailer’s basic net earnings per common share during the quarter rose 73.9% to C$0.40.

Executive chairman Galen Weston said Loblaw’s results had “benefited” from rising food prices. In the first quarter of 2008, Loblaw experienced food deflation.

Weston added: “Our focus remains on consistent execution while undertaking aggressive store renovation and infrastructure programmes. We remain cautious and prepared for continuing challenges through 2009, as inflation could unwind and economic conditions remain volatile.”