UPDATE 1-Sobeys-owner Empire reports lower profit, to close 50 stores
* To close 50 underperforming stores
* Raises quarterly dividend by 1 Canadian cent (Adds details from the statement, share close)
June 26 (Reuters) - Empire Co Ltd, the operator of Canadian grocery chain Sobeys Inc, reported a lower quarterly profit and said it would close 50 underperforming stores.
Empire said 60 percent of the closures would be in Western Canada and it expects cost savings to result in an improvement in net earnings.
The company said sales would decline by about C$400 million ($370 million) but did not provide further details.
Empire bought the Canadian arm of Safeway Inc for $5.7 billion to double its reach in the Western provinces and help it compete with U.S. retail giants such as Wal-Mart Stores Inc and Target Corp
The company said on Thursday store closures represent 3.8 percent of the total retail network gross square footage. Empire had more than 1,500 stores as of June 2013, before it bought Safeway stores.
Fourth-quarter sales rose about 40 percent to C$5.94 billion, which included C$1.59 billion from Safeway stores.
Net earnings fell to C$800,000, or 1 Canadian cent per share, in the fourth quarter ended May 3, from C$105.9 million, or C$1.56 per share, a year earlier.
Excluding costs of C$169.8 million related to the store closures, Empire earned C$1.42 per share.
The company also raised its quarterly dividend to 27 Canadian cents per share from 26 Canadian cents.
Empire's shares closed at C$67.10 on the Toronto Stock Exchange on Wednesday. ($1 = 1.0853 Canadian Dollars) (Reporting By Sneha Banerjee in Bangalore; Editing by Sriraj Kalluvila and Don Sebastian)
- Total CEO de Margerie killed in Moscow as jet hits snow plow |
- Sweden gets two new sightings, as hunt for undersea intruder goes on
- Pistorius starts five-year term for killing Reeva Steenkamp
- U.S. to funnel travelers from Ebola-hit region through five airports
- Ebola crisis turns a corner as U.S. issues new treatment protocols