The repercussions of the trade war are felt in the alleys of Quebec grocery with a larger scale than expected: Metro must negotiate with 3000 suppliers who want to raise their prices.
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“We negotiate the pricing requests. It must be proven, “said CEO Eric La Flèche when the quarterly results were published on Wednesday.
Metro suppliers are demanding increases of more than 7% or “at the top of the percentage range to a figure”, depending on the language of the CEO.
Metro presented contrasting results for the third trimester. If the net profit jumped from $ 9% to $ 323 million, comparable power sales disappointed 1.9% against 3.3% anticipated by analysts.
The action also dropped 7% on the Toronto Stock Exchange on Wednesday.
Halftone performance despite efficiency gains
With income up 3.3% to $ 6.9 billion, Metro maintains its gross margin at 19.8% while controlling its operating expenses to 10.2% of turnover.
Pharmacies save the bet with comparable growth of 5.5%, compensating for food slowdown.
Intensified competition and adaptation strategies
The arrow recognizes that “the battle of the circulars has intensified a little” with the opening of new stores and conversions of signs.
Metro maintains its investments with 5 new stores in the quarter and continues its stock buyout program of $ 561.8 million since November.