Loblaw Companies says its fourth-quarter profit was down by more than one-third compared with the prior year, largely because of special items including the write-down of some assets that are set aside for sale.
Canada’s largest grocery and pharmacy retailer says net income for shareholders fell to $128 million, or 31 cents per share.
That’s down from $247 million or 60 cents per share reported a year earlier, when the comparable quarter had an extra week. Excluding the extra week, the year-earlier profit would have been $195 million or 47 cents per share.
Loblaw says its stores performed well during the fourth quarter, with sales growth and stable margins.
Overall retail sales were $10.86 billion. That was down from a year earlier because of the extra reporting week in 2014, but up $241 million or 2.3 per cent from $10.6 billion on a standard 12-week basis.
Loblaw’s profit was reduced by a number of unfavourable items, including a writedown of drug retail assets that are being held for sale as well as costs for switching some grocery stores to more cost-effective labour agreements.
The writedown of drug retail assets shaved $112 million or 20 cents per common share from the earnings, the largest of the special items. The second-largest was $55 million, or 10 cents per share, related to the new labour agreements.
After adjustments, Loblaw earned $363 million — up 5.5% compared with the fourth quarter of 2014. The adjusted earnings per share were 88 cents in the latest quarter.
