Loblaw Cos (TSE:L), Canada's largest grocer, more than doubled its fiscal fourth-quarter profit, primarily as a result of its acquisition of Shoppers Drug Mart. Shares advanced.
Net income rose to C$247 million, or C$0.60 per share, in the three months ended January 3 from C$114 million, or C$0.41 per share, a year earlier, the Brampton, Ontario-based company said in a statement today.
Excluding items, Loblaw earned C$0.96 per share. Analysts polled by Capital IQ were expecting C$0.89.
Loblaw’s revenue was $11.4 billion, including $3 billion from Shoppers. The result was ahead of the C$11.30 billion analysts expected. The overall revenue was up 49.4 percent from the fourth quarter of 2013. Excluding Shoppers Drug Mart, revenue was up 9.4 percent, the company said.
Loblaw said same-store sales, which exclude Shoppers, were up 2.4 percent in the latest quarter. For its core grocery segment, same-store sales rose 3.3 percent.
“While the competitive intensity in grocery remains high, and the regulatory environment in health care remains challenging, we believe we are well-positioned to achieve stable earnings growth,” Galen G. Weston, president and executive chairman, said.
Loblaw, which closed its C$12.4 billion takeover of Shoppers at the end of March to create a grocery and pharmacy giant, said it is targeting 2015 capital spending of about C$1.2 billion.
The board also declared a quarterly dividend of $0.245 per common share, payable on April 1 to shareholders of record on March 15.
Shares were up 0.8 percent at C$64.85 at 3:13 p.m. in Toronto. The stock has rallied 42 percent over the past year.