Loblaw not yet seeing price increases due to elevated fuel costs
Loblaw Companies said high fuel costs are not yet affecting prices in its stores.
Per Bank, chief executive officer, said the food and pharmacy retailer is “fighting back on price increases from suppliers.”
“So far, we are not seeing any price increases due to [high fuel costs],” Bank said on Loblaw’s first quarter earnings call Wednesday (May 6).
Richard Dufresne, chief financial officer, added: “It’s definitely more in Q2 we see a slight change, but not material.”
READ: Major grocers push back on fuel surcharges as independents have 'no choice' but to accept
In his opening remarks, Dufresne said Loblaw’s inflation measures at the cash register are “more or less” aligned with same-store sales growth.
“Our efforts to push back on unjustified cost increases from global suppliers has delivered results, helping to reduce the inflationary pressures on Canadians,” he said.
Loblaw reported a profit of $594 million for the first quarter, up 18.1% from last year.
Revenue, including the company’s retail operations and its PC Financial business was $14.72 billion, an increase of $589 million.
Retail revenue alone was $14.48 billion, a $580 million increase.
PC Financial is being sold to EQ Bank for $800 million. The deal, announced last December, is expected to close this year.
Food retail same-store sales increased by 2.4%. Drug retail same-store sales rose 4.1%.
E-commerce sales increased by 20.3%.
“We deliver solid financial results, including strong revenue and adjusted EPS growth. And I'm delighted that we are able to achieve this while making significant investments to grow our pharmacy and discount presence, expand our T&T banner into the U.S. and advance two new technology enabled distribution centres," Bank said.
The first quarter’s food sales growth included results from 28 discount stores that have opened since 2023.
“These stores are averaging double digit same-store sales growth,” Dufresne said.
Loblaw opened 13 stores in the first quarter of its 2026 fiscal year, which ended March 28. That includes eight Shoppers Drug Mart stores and five hard discount supermarkets.
On March 26, the retailer opened its first No Frills in Komoka, Ont. No Frills called the location a “fresh take on the traditional warehouse feel,” intended to change the way people view discount shopping.
The grocer plans to open a total of 30 discount stores this year.
“We're confident that we can continue to build about, I don't know, 30 to 40 new No Frills and Maxis per year, and about 70 stores total including Shoppers Drug Mart,” Bank said.
Dufresne said Loblaw’s discount banners remain a key driver of absolute sales growth, but said its conventional business “remains very healthy.”
“When we look at our same-store performance, our total growth—despite the fact that we're not adding much square footage, if any, that business continues to perform really well for us,” he said.
