Loblaw to close 52 stores

The Guardian (Charlottetown) - - BUSINESS - THE CANA­DIAN PRESS

Loblaw Com­pa­nies Ltd. (TSX:L) has put its neigh­bour­hood drug stores and su­per­mar­kets un­der a mi­cro­scope as it re­sponds to in­creas­ing com­pe­ti­tion and will shut­ter 52 lo­ca­tions in the com­ing year af­ter con­clud­ing they fell short of ex­pec­ta­tions.

The com­pany said in its sec­ond-quar­ter earn­ings re­port on Thurs­day that the clo­sures will save $35 mil­lion to $40 mil­lion in an­nual op­er­at­ing in­come, de­spite the loss of $300 mil­lion in sales.

Loblaw pres­i­dent and ex­ec­u­tive chair­man Galen We­ston Jr. said that the com­pany is fo­cused on find­ing ef­fi­cien­cies as growth slows.

In a nor­mal year, he added, the com­pany would close 10 to 15 stores.

“Yes, it's an in­crease, but it's not rad­i­cally dif­fer­ent,” he said in a con­fer­ence call with an­a­lysts and in­vestors. “It doesn't sig­nal any kind of change from a strate­gic per­spec­tive.”

The clo­sures will be dis­trib­uted across the coun­try and in­clude pre­vi­ously an­nounced clo­sures of Joe Fresh oper­a­tions in the U.S., though they would not make a “ma­te­rial change” to the cloth­ing line's Cana­dian lo­ca­tions, he said.

In its latest an­nual re­port, the com­pany had more than 2,300 lo­ca­tions for its many brands in­clud­ing Loblaws, Shop­pers Drug Mart, No Frills and Joe Fresh.

CP PHOTO

A Loblaws store is seen on March 9, 2015, in Mon­treal.

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