Canadian grocery retailer Sobeys has announced a fall in net earnings for the second quarter ended 5 November 2005, despite higher sales, because of the costs of an initiative to improve systems and businesses efficiency in Ontario.

Sales for the period were CAD3.218bn (US$2.8bn), compared with CAD2.967bn in the equivalent period last year. Net earnings were CAD45.8bn, compared with CAD47.2bn.

Included in earnings for the second quarter are CAD4.6m of costs related to the Ontario business process and system initiative.

“Once again we are pleased that our continuing efforts to improve our in-store offering and execution combined with our ongoing productivity initiatives produced strong sales and solid earnings in the second quarter,” said Bill McEwan, president and CEO. “At the same time, our extensive Ontario business process, supply chain and systems transformation initiative is right on track.”