Loblaw Cos. Ltd. reported third-quarter earnings Wednesday that beat analysts' expectations despite modest sales growth.
Loblaw said its profit more than doubled from a year ago to 883 million Canadian dollars ($692.1 million), or C$2.24 a share, as it benefited from improvements in operations and the sale of its gas-station business.
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The Canadian grocery and drug store company said earnings on an adjusted basis rose 7.2% from a year ago to C$549 million, or C$1.39 a share. Analysts polled by Thomson Reuters were expecting C$1.30 a share.
Shares, up 6.7% so far this year, were flat at $C69.15 in pre-market trading.
Revenue rose 0.3% to C$14.19 billion, while retail sales rose 0.2%. Drug retail same-store sales rose 3.3% and food retail same store-sales grew 1.4%.
Loblaw said it made progress on goals to reduce costs in its latest quarter.
Brookfield Business Partners LP closed on its C$540 million purchase of Loblaw's gas-station operations. It also cut 500 jobs at the store and corporate level. The company also finalized a plan to close 22 locations deemed unprofitable by the end of the first quarter of 2018.
With the moves Loblaw expects to incur about C$135 million worth of charges, the bulk of which will be recorded in the current quarter. The moves are expected to save the company about C$85 million on annual basis.
During the quarter, Loblaw spent C$485 million buying back 7.2 million shares.
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(END) Dow Jones Newswires
November 15, 2017 09:06 ET (14:06 GMT)