Canada's Loblaw profit beats estimates on retail sales

FILE PHOTO: A Loblaws store is pictured in Ottawa February 24, 2011. REUTERS/Chris Wattie

(Reuters) - Loblaw Cos Ltd reported a better-than-expected quarterly profit on Thursday, as more people shopped at the Canadian retailer’s food and drug stores.

In the face of stiff competition from Inc, Loblaw has been expanding its home delivery services in Canada, through its partnership with San Francisco-based online grocery chain, Instacart.

Adjusted gross profit in the retail segment, the company’s biggest, rose 2.6 percent to C$3.25 billion.

The company said retail same-store sales, both in the food and drug segments, grew 1.7 percent in the quarter.

Excluding items, the company earned C$1.07 per share, beating analysts’ average estimate of C$1.04 per share, according to IBES data from Refinitiv.

Net profit available to shareholders rose to C$221 million ($168 million), or 59 Canadian cents per share, in the fourth quarter ended Dec.31, from C$31 million, or 8 Canadian cents per share, a year earlier.

Revenue rose to C$11.22 billion from C$10.99 billion.

($1 = 1.3189 Canadian dollars)

Reporting by Shradha Singh in Bengaluru; Editing by Shailesh Kuber