Metro Inc, the Canadian retailer, saw its earnings rise in its second quarter but the improvement failed to prevent a slide in half-year profits.
The company said today (20 April) that net earnings for the three months to 12 March rose 3.7% to C$83.3m (US$87.4m). However, over the first half of its fiscal year, net earnings were down 1.7% at C$175.3m.
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Metro said that adjusted net earnings for the first half of its fiscal year – excluding a fall in tax expenses and costs from store conversions booked in the first quarter of fiscal 2010/11 – were up 3.7%.
However, the retailer’s first-half EBITDA was down 0.3% at C$352.7m, compared to C$353.7m a year earlier – even as its second-quarter EBITDA inched up 0.1% to C$171.7m.
Second-quarter sales dipped 0.4% to C$2.57bn, although half-year sales were down 0.5% at C$5.2bn. Same-store sales in the second quarter rose 0.2% amid a 1% fall in food prices as competition increased.
President and CEO Eric La Flèche said: “We are satisfied with the growth of our net earnings in the second quarter, although sales continued to be affected by food price deflation and lower drug pricing. Despite the difficult competitive environment, we are confident that we will continue our growth due to our effective merchandising, loyalty, and cost control programmes.”
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