(Reuters) - Canada’s Empire Co Ltd (EMPa.TO), parent of Sobeys grocery chain, reported an adjusted profit from continuing operations that missed analysts’ estimate as competition intensified.
The company attributed a 40 percent fall in first-quarter net profit to higher promotional activities and expenses related with the acquisition of the Canadian assets of Safeway Inc SWY.N.
Loblaw Cos Ltd (L.TO), Canada’s biggest grocery chain, consolidated pharmacy assets with a C$12.4 billion deal to buy Shopper’s Drug Mart Corp SC.TO in July.
Empire’s total sales increased to C$4.61 billion ($4.46 billion) in the quarter ended August 3 from C$4.51 billion a year earlier.
Analysts on average had expected revenue of C$4.72 billion, according to Thomson Reuters I/B/E/S.
Sales at Sobeys, Empire’s food retailing unit, rose 2.2 percent to C$4.59 billion.
Net earnings from Empire’s continuing operations fell to C$82.6 million, or C$1.21 per share, from C$108.1 million, or C$1.59 per share.
Adjusted earnings from continuing operations fell 19 cents to C$1.32 per share, compared with analysts’ estimate of C$1.55 per share.
Sobeys, which operates about 1,500 retail outlets under banners such as Lawtons Drugs, Price Chopper, FreshCo, and Thrifty Foods, recorded a 0.1 percent fall in sales at established stores — an important measure for retailers.
($1 = 1.0333 Canadian dollars)
Reporting by Krithika Krishnamurthy in Bangalore; Editing by Joyjeet Das