Empire Company to close Alberta e-commerce facilities

Mr. Pierre St-Laurent reports EMPIRE PROVIDES E-COMMERCE UPDATE Empire Company Ltd. and its wholly owned subsidiary Sobeys Inc. have provided an e-commerce update focused on delivering immediate earnings improvement while expanding successful third party delivery partnerships. The actions contained in this update will allow the company to better serve the evolving needs of its on-line customers, particularly in the fastest-growing immediacy segment of e-commerce. Empire expects the actions contained in this update to deliver approximately $95-million in annualized operating income in fiscal 2027. The company will incur non-cash impairment and related cash charges (including the impairment of right-of-use assets) in the third quarter of fiscal 2026 of approximately $750-million as a result of the rationalization and financial underperformance of its e-commerce network. "We remain highly committed to grocery e-commerce in Canada and on continuing to make on-line shopping more convenient for our customers while delivering immediate bottom line improvements to our e-commerce business," said Pierre St-Laurent, president and chief executive officer, Empire. Key elements of Empire's e-commerce update include the following. 1. Immediate wind-down and closure of its Alberta e-commerce facilities, composed of a customer fulfilment centre in the Calgary area and a smaller support facility in Edmonton. In addition and as previously communicated, the company will continue the pause on development of its CFC located in the Vancouver area. Empire's Alberta e-commerce operations have not met the company's financial expectations, largely due to the Alberta grocery e-commerce market's size and expansion being smaller than originally anticipated. Empire will continue to support customers in Western Canada who prefer to shop on-line through its third party partnerships. The closure of the Alberta facilities is not expected to have a material impact on the company's same-store-sales growth. 2. The company will continue to serve customers in Ontario and Quebec through its Voila banner, supported by its existing CFCs in the Greater Toronto and Montreal areas. Those operations are growing steadily and continue to form a key component of the company's overall offering. With improving e-commerce penetration and high-growth potential in Ontario and Quebec, together with its strong partnership with Ocado, Empire is well positioned to increase customer engagement and improve productivity and profitability across these geographies. 3. The company will expand its third party delivery partnerships through a new collaboration with DoorDash, expected to begin rolling out in the coming months. The additional access to grocery essentials through one of Canada's leading local commerce platforms will expand home delivery options for customers across the country and builds on Empire's successful existing third party partnerships. These actions reflect the company's commitment to provide customers a variety of e-commerce options while improving profitability in all of its e-commerce channels. "Customers in Ontario and Quebec love Voila, and, while difficult, the decisions we have made related to our CFC network in Western Canada will help ensure the long-term growth and profitability of our e-commerce business," said Mr. St-Laurent. "Our focus remains on thrilling our customers while giving them even more reasons to shop our banners through Voila and third party marketplaces across the country. This is just the beginning of the next chapter in reshaping our e-commerce strategy as we respond to the evolving needs and expectations of our customers." About Empire Company Ltd. Empire Company is a Canadian company headquartered in Stellarton, N.S. Empire's key businesses are food retailing, through wholly owned subsidiary Sobeys, and related real estate. With approximately $31-billion in annual sales and $17-billion in assets, Empire and its subsidiaries, franchisees and affiliates employ approximately 129,000 people. We seek Safe Harbor.