July 17, 2014 / 11:34 AM / 5 years ago

Loblaw executive chairman Weston takes on president's role

(Reuters) - Loblaw Cos Ltd (L.TO), Canada’s largest grocer, appointed Executive Chairman Galen Weston president as part of a management shakeup aimed at helping the company better compete with U.S. rivals.

Executive chairman of Loblaw Companies Limited Galen G. Weston speaks at a news conference in Toronto, July 15, 2013. REUTERS/Mark Blinch

Weston, son of the founder of George Weston Ltd — Loblaw’s largest shareholder — will be responsible for the company’s overall business performance as president, the company said.

Weston replaces Vicente Trius with immediate effect. Trius is leaving the company for family reasons.

Loblaw has been struggling with higher fuel costs, a weak Canadian dollar and an increase in minimum wages in Ontario, while trying to fend off competition from Wal-Mart Stores Inc (WMT.N) and Target Corp (TGT.N).

The company, which completed the acquisition of Shoppers Drug Mart [SDMC.UL] earlier this year, also said Domenic Pilla, the president of its pharmacy chain, would leave by the end of the year.

Mike Motz, Loblaw’s current chief merchandising officer and executive vice president, will replace Pilla.

“Our two businesses (Loblaw, Shoppers Drug Mart) are working well together and we are on track to deliver the first $100 million in synergies by the end of the first quarter of 2015,” Weston said in a statement.

The company will consolidate the results of Shoppers Drug Mart for the first time when it reports second-quarter results next week.

Loblaw said it expects strong same store sales growth in its supermarket and pharmacy businesses in the quarter.

Analysts at National Bank Financial (NBF) had estimated growth of 1.3 percent in Loblaw retail same store sales, compared with 1.1 percent a year earlier.

The Brampton, Ontario-based company also appointed a new chief financial officer on Thursday. [ID:nCNW4dfKga]

Richard Dufresne will take on the role of CFO of Loblaw in addition to his current role of CFO at George Weston, which holds a more than 45 percent stake in Loblaw.

Current Loblaw CFO Sarah Davis would become chief administrative officer, the company said.

Loblaw shares closed at C$49.28 on the Toronto Stock exchange on Wednesday.

Reporting By Shubhankar Chakravorty in Bangalore; Editing by Saumyadeb Chakrabarty and Simon Jennings

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