Sobeys' Parent Company Posts Q4 Results, Reports Huge Loss
STELLARTON, CANADA – Empire Company Ltd., the parent company of retail chain Sobeys, has released its 2016 Q4 results and cited a net loss of $942.6 million.
This decrease is a loss of $3.47 per diluted share, compared with a net profit of $55.4 million, or $0.20 a share, from last year’s fourth quarter.
“The previously reported challenges in Western Canada that have had a negative effect on our results over the past three quarters, deepened through the fourth quarter, with impacts felt across additional banners in the West and which have led the Company to incur an impairment charge of $1.3 billion dollars in addition to the charge recorded in the third quarter,” said Marc Poulin, President and CEO, Empire Company Limited, in a recent press release.
The company's integration of Safeway operations was the main driving factor behind the loss, according to Empire, although the Q4 report also listed that Sobeys’ same-store sales also decreased 1.8 percent. The company cited fuel sales and West business retail unit as having a negative impact on the chain’s numbers, and if not for those factors, same-store sales would’ve increased 0.2 percent.
Other highlights from the Q4 report, when compared to the same quarter from 2015, are as follows:
- Sales up 8.9 percent to $6,283.2 million from $5.7 million
- EBITDA decreased $1,283.5 million to $(1,047.2) million from $236.3 million last year
- Adjusted net earnings, net of non-controlling interest, of 95.3 million, decrease of $998.0 million from $55.4 million
- Free cash flow generation of $82.5 million, decrease of 39.3 percent from $136.7 million
“Management is also seeing early evidence of a softening sales trend in other regions of the country. Although management remains focused on reversing these negative trends by continuing on our core strategies of cost reduction, network renewal, and relevant pricing for our customers, the stabilization of our business will take time,” finished Poulin.
Empire’s Board of Directors also announced an increase to the annual dividend per share to be paid quarterly, from $0.40 per share to $0.41 per share, an increase of 2.5 percent.
The company stated that this year’s Q4 encompassed 14 weeks, whereas last year’s report spanned 13 weeks.
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