Metro Inc. (TSX: MRU) released its financial results for the first quarter of fiscal 2024, for the period ending December 23, 2023. The company reported total sales of $4.97 billion for the first quarter, reflecting a 6.5% increase compared to the same period last year.
Noteworthy growth was observed in key segments, with food same-store sales up by 6.1%, and pharmacy same-store sales registering a 3.9% uptick. Adjusting for the Christmas week shift, food same-store sales increased by 3.4%.
CEO Eric La Flèche highlighted the success of the company’s discount food stores, emphasizing their faster sales growth. Private label penetration achieved record levels, and the MOI loyalty program’s membership doubled to 2.5 million, surpassing Metro&Moi.
“We are confident that our sustained investments in the modernization of our supply chain and our retail networks will continue to create long term value for our shareholders,” declared La Flèche.
The results were released following the company’s report that it donated $63 million worth of food in 2023 to community partners Feed Ontario, Food Banks of Quebec, and New Brunswick’s Food Depot Alimentaire. Metro’s One More Bite program, focused on reducing food waste, contributed to the recovery and redistribution of over 27 million kilos of food, equivalent to more than 53 million meals.
Marie-Claude Bacon, Vice-President of Public Affairs and Communications, emphasized Metro’s increased community investments by 35% over the previous year, aiming to make a tangible impact in supporting vulnerable communities.
For the first quarter, operating income before depreciation and amortization stood at $468.1 million, representing 9.4% of total sales. Gross margin was maintained at 19.6% compared to last year while operating expenses, as a percentage of sales, went up to 10.2% “mainly due to the commissioning of [its] new automated distribution centre for fresh and frozen products in Terrebonne.”
Notably, the total depreciation and amortization expense for the first quarter amounted to $131.1 million. Reported net financial costs came in at $32.4 million for Q1 2024, representing an increase from $27.1 million in Q1 2023. This uptick is linked to factors such as increased debt, higher interest rates, and reduced capitalized interest associated with distribution center automation projects.
Net earnings amounted to $228.5 million, representing a decline of 1.1%. Adjusted net earnings were $235.0 million, also down 1.1%. Fully diluted net earnings per share stood at $0.99, reflecting a 2.1% increase. Adjusted fully diluted net earnings per share reached $1.02, up 2.0%.
The company declared a dividend of $0.335 per share, marking a 10.7% increase compared to the previous year.
Metro last traded at $71.21 on the TSX.
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