Competition holds back Canadian grocer Loblaw's revenue
(Reuters) - Loblaw Cos Ltd L.TO, Canada's largest grocer, reported lower-than-expected quarterly revenue in the face of increasing competition from expanding U.S. rivals.
Wal-Mart Stores Inc (WMT.N: Quote) and Target Corp (TGT.N: Quote) have expanded in Canada over the past year, challenging Canadian retailers such as Loblaw, Canadian Tire Corp Ltd CTCa.TO and Metro Inc (MRU.TO: Quote).
Loblaw, which has just completed its C$12.4 billion acquisition of Shoppers Drug Mart Corp, said total revenue rose just over 1 percent to C$7.29 billion.
Retail same store sales grew by about 1 percent compared with a growth of 2.8 percent in the year-ago quarter.
Excluding one-off charges, the company earned C$139 million, or 49 Canadian cents per share, up slightly from C$134 million, or 48 Canadian cents per share a year earlier.
Analysts on average had expected the company to earn 46 Canadian cents on revenue of C$7.32 billion, according to Thomson Reuters I/B/E/S.
The company raised its quarterly dividend by half a cent to 24.5 Canadian cents from a previous 24 cents.
Loblaw shares closed at C$45.80 on Tuesday on the Toronto Stock Exchange.
The stock has risen about 7 percent in the past three months, outperforming the stocks of Loblaw's smaller rivals Empire and Metro. Metro's stock has risen about 2 percent, while that of Empire has fallen about 6 percent in the same period.
($1 = 1.0966 Canadian Dollars)
(Reporting by Ashutosh Pandey in Bangalore)
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