* Adjusted profit C$1.19 vs est. C$1.22
* Same-store sales down 1.8 percent
Nov 13 Metro Inc, Canada's No.3 grocer,
posted a larger-than-expected 40 percent drop in quarterly
profit as expanding U.S. retailers provided "intense
competition" in its home market.
Metro Inc said its fourth-quarter sales were hurt by
competition, especially in Ontario, where rival retailers have
opened more stores.
Wal-Mart Stores Inc is expanding in Canada and
Target Corp, which entered the Canadian market this
year, has said the country will be key to its growth over the
next five years.
Target plans to have 124 Canadian stores by the end of the
To cope with increased competition, Metro is reorganizing
its Ontario store network and plans to invest nearly C$250
million ($238.25 million) there in 2014.
The company, which runs Adonis ethnic food stores and the
Brunet pharmacy chain, said in August that it would close or
convert 15 of its stores in Ontario to cut costs.
The company is converting about half a dozen Metro stores
into Food Basics discount outlets.
"We are confident that these measures, coupled with
efficient merchandising strategies, will allow us to continue to
grow in the next fiscal year," Chief Executive Eric La Flèche
Metro, whose main domestic competitors are Loblaw Cos Ltd
and Empire Co Ltd's Sobeys, also said in August
that it would operate Target's in-store pharmacies in Quebec.
Canada's largest grocer Loblaw, which is buying Shoppers
Drug Mart Corp for C$12.4 billion, reported a 29 percent
fall in quarterly profit on Wednesday.
Empire Co is buying Safeway Inc's assets in Canada
to cement its position as Canada's No.2 grocer.
Metro's net earnings fell to C$83.6 million, or 88 Canadian
cents a share, in the fourth quarter from C$145.1 million, or
C$1.46 a share, a year earlier.
Adjusted profit was C$1.19, below analysts' average estimate
of C$1.22, according to Thomson Reuters I/B/E/S.
Sales fell nearly 9 percent to C$2.61 billion in the fourth
quarter ended Sept. 30, which had 12 weeks compared with 13
weeks the previous year.
Sales at established stores, a key measure for retailers,
fell 1.8 percent.
Metro shares have fallen nearly 10 percent in the last three
months and closed at C$65.71 on the Toronto Stock Exchange on