Metro reports gains in discount, pharmacy banners amid DC operational hurdle
Metro Inc. reported its Q4 total sales increased by 3.4% versus the fourth quarter last year, primarily driven by higher sales in the retailer’s discount and pharmacy retail networks.
Operational hurdles at the retailer’s frozen distribution centre in Toronto began Sept. 12, and impacted its 2025 fourth-quarter profit, resulting in a profit of $217.0 million, down from $219.9 million in the same quarter last year.
“The after tax financial impact of this situation on our fourth quarter was $22.5 million or $30.6 million before taxes, which includes $24.5 million for inventory losses as well as $6.1 million for other direct costs related to temporary equipment rental [...] as well as incremental transportation and third party logistics costs for the execution of our contingency plan,” said Nicolas Amyot, EVP, CFO and treasurer, Metro, during a conference call on Nov. 19.
The impact on sales and margin is expected to be modest given the contingency plan in place and is expected to be “essentially back to normal” by the end of December.
“Metro’s automated freezer distribution centre in Quebec assumed a substantial portion of the Ontario volume, along with three Ontario-based third-party logistics providers and increased direct-to-store deliveries from several suppliers,” notes Eric La Flèche, the retailer’s CEO, during the conference call.
Metro reports that same store sales grew by 1.6% in the quarter, while pharmacy same store sales grew by 4.8%, supported by 5.5% growth in prescription sales and a 2.9% growth in front-end sales.
The retailer’s internal food basket inflation was below the reported food CPI of 3.4%.
“[Metro Inc.] continues to see inflationary pressures on certain commodity prices, namely in the meat category. We are presently in our price freeze period, however, we continue to receive price increase requests from our vendor partners at higher levels than typical. We continue to negotiate to minimize the impact on consumers going forward,” said La Flèche.
During the quarter, Metro grocery stores saw an increase in average basket, partly offset by a slight decrease in transactions. On the discount side, both basket and foot traffic were up. Private label sales continue to outperform national brands.
Online sales grew by 19.8% in the quarter, driven by the ramp up of click-and-collect and the launch of home delivery at Super C and Food Basics, as well as third-party marketplaces.
“Discount continues to drive same store sales faster than Metro with the gap between them remaining consistent with the prior quarter. [...] Total food sales growth of 3.2% reflects the performance of our new stores and conversions,” says La Flèche.
In Q4 2025, Metro opened 14 stores, including five conversions and major expansions and renovations at 17 stores. These conversions, renovations and new stores added 294,000 sq. ft. to the retailer’s retail network square footage.
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“We continue to see more opportunities in the coming years and our plan calls for a dozen new discount stores in fiscal 26, including a few conversions,” says La Flèche.
Metro also celebrated the first anniversary of the Moi loyalty program in Ontario.
“Although still early in the programme, we continue to see encouraging metrics with the growing member base and improved penetration rates,” says La Flèche.
