Sales growth for Canadian retailer Sobeys failed to stop increasing costs eating into the company’s bottom line in the third quarter.
For the three months to 4 February, net earnings amounted to C$72.9m (US$73.5m), a 9.9% drop on the prior-year period. On an adjusted basis, removing the impact of a one-time gain in the year-earlier period, Sobeys earned C$65.5m, up slightly from C$65.4m last year.
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Operating profits slid 16.9% to C$123.2m, the retailer reported yesterday (13 March).
Sales in the period, however, edged up 2.8% to reach C$3.98bn, while same-store sales grew 1.2%. Sobeys food retail sales increased 2.9% to C$3.94bn, with same-store sales increasing 1.2% on the prior-year period.
“We are pleased with our third quarter performance as we continue to grow in both our food retail and real estate businesses,” said Sobeys’ president and CEO Paul Sobey.
“We continue to grow by working together organisation-wide to improve productivity and lower costs while driving product and service innovation to enrich our customers’ experience and to ensure our competitive position in an ever changing retail landscape.”
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