Loblaw Reports 2019 First Quarter Results and a 6.8% Increase to Quarterly Common Share Dividend¹
BRAMPTON, ON, May 1, 2019 /CNW/ - Loblaw Companies Limited (TSX: L) ("Loblaw" or the "Company") today announced its unaudited financial results for the first quarter ended March 23, 2019. The Company's 2019 First Quarter Report to Shareholders will be available in the Investors section of the Company's website at loblaw.ca and will be filed with SEDAR and available at sedar.com.
"We are pleased with the quarter, our continued strong operational performance, and our strategic momentum," said Galen G. Weston, Executive Chairman, Loblaw Companies Limited. "We are gaining traction on our key priorities and accelerating investments to deliver long-term value to customers and shareholders."
2019 FIRST QUARTER HIGHLIGHTS
Unless otherwise indicated, the following highlights represent the Company's results from Continuing Operations and include the impacts of spin-out related incremental depreciation, the implementation of IFRS 16, "Leases" ("IFRS 16") and the consolidation of franchises. The first quarter of 2019 was negatively impacted by healthcare reform. See "Other Business Matters" of this News Release for more information on the spin-out related incremental depreciation and the implementation of IFRS 16.
Revenue was $10,659 million, an increase of $324 million, or 3.1%, compared to the first quarter of 2018.
Retail segment sales were $10,452 million, an increase of $297 million, or 2.9%, compared to the first quarter of 2018.
Food retail (Loblaw) same-store sales growth was 2.0%.
Drug retail (Shoppers Drug Mart) same-store sales growth was 2.2%, with pharmacy same-store sales growth of 1.2% and front store same-store sales growth of 3.1%.
The timing of Easter had a nominal impact on same-store sales growth for both Food retail and Drug retail in the first quarter of 2019.
Operating income was $451 million, an increase of $75 million, or 19.9%, compared to the first quarter of 2018.
Operating income included the year-over-year favourable impact of the implementation of IFRS 16 of approximately $75 million and the unfavourable impact of spin-out related incremental depreciation of approximately $22 million. Normalized for these impacts operating income increased by $22 million.
Adjusted EBITDA² was $1,040 million, an increase of $307 million, or 41.9%, compared to the first quarter of 2018.
Adjusted EBITDA² included the year-over-year favourable impact of the implementation of IFRS 16 of $282 million. Normalized for this impact, adjusted EBITDA² increased by $25 million, or 3.4%.
Net earnings available to common shareholders of the Company from Continuing Operations were $198 million, a decrease of $14 million compared to the first quarter of 2018. Diluted net earnings per common share were $0.53, a decrease of $0.02 compared to the first quarter of 2018.
Adjusted net earnings available to common shareholders of the Company² from Continuing Operations were $290 million, a decrease of $22 million, compared to the first quarter of 2018. Normalized for the year-over-year impact of the spin-out related incremental depreciation of approximately $16 million and IFRS 16 of approximately $6 million, adjusted net earnings available to common shareholders of the Company² was flat at $312 million.
Adjusted diluted net earnings from Continuing Operations per common share² were $0.78, a decrease of $0.03, or 3.7%, compared to the first quarter of 2018. Normalized for the year-over-year impact of the spin-out related incremental depreciation of approximately $0.04 per common share and IFRS 16 of approximately $0.02 per common share, adjusted diluted net earnings per common share² increased by approximately 3.7% or $0.03 per common share and was $0.84 per common share.
The Company repurchased 3.7 million common shares at a cost of $235 million in the first quarter of 2019.
The Company invested $174 million in capital expenditures and generated $419 million of free cash flow² in the first quarter of 2019. The definition of free cash flow² was changed in the first quarter of 2019 to normalize for the impact of the implementation of IFRS 16, which had no impact on cash flow.
Quarterly common share dividend to be increased by 6.8% from $0.295 per common share to $0.315 per common share.
Note: This is an excerpt from the full release. To view the complete document, please download the full Q1 2019 news release.
¹ This News Release contains forward-looking information. See "Forward-Looking Statements" section of this News Release for a discussion of material factors that could cause actual results to differ materially from the forecasts and projections herein and of the material factors and assumptions that were used when making these statements. This News Release should be read in conjunction with Loblaw Companies Limited's filings with securities regulators made from time to time, all of which can be found at sedar.com and at loblaw.ca.
² See "Non-GAAP Financial Measures" section of this News Release, which includes the reconciliation of such non-GAAP measures to the most directly comparable GAAP measures.
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