Loblaw Q2 profit soars a year after getting a lift from COVID-19 onset

Loblaw Companies Ltd. says its second-quarter profit soared on a 4.5% increase in revenues as it marked a year since it posted heightened sales and COVID-related costs from the outset of the pandemic.

Canada's largest grocery and pharmacy chain says its net income attributable to common shareholders was $375 million or $1.09 per diluted share, up from $169 million or 47 cents per share a year earlier.

Adjusted profits for the three months ended June 19 was $464 million or $1.35 per diluted share, up from $260 million or 72 cents per share in the second quarter of 2020.

Revenues were $12.49 billion, compared with $11.96 billion in the prior year quarter as food same-store sales declined 0.1% and Shoppers Drug Mart same-store sales increased 9.6%.

Loblaw was expected to post $1.21 per share in adjusted profits on $12.16 billion of revenues, according to financial data firm Refinitiv.

COVID-19 related costs were $70 million, including $25 million for one-time bonuses, compared with $282 million and $180 million, respectively, a year earlier.

Chairman and president Galen G. Weston says demand continues to be driven by elevated eat-at-home trends, but there's lower demand for cosmetics during the lockdowns.

"We maintained our focus on delivering value and quality to Canadians while providing a safe shopping experience, and are well-positioned to meet the evolving needs of customers as the pandemic restrictions begin to lift," he said in a news release.