METRO REPORTS 2026 FIRST QUARTER RESULTS
Executive Summary
- Metro Inc. reported FY 2026 first‑quarter sales of $5,285.8 M, up 3.3% year‑over‑year.
- Net earnings fell to $226.3 M (‑12.8%) while adjusted net earnings rose modestly to $248.7 M (+1.3%).
- The Board declared a quarterly dividend of $0.4075 per share, a 10.1% increase versus the prior year.
Key Details
- Sales & Same‑Store Metrics
- Food same‑store sales +1.6% (adjusted for Christmas shift +1.9%).
- Online food sales +25.8% YoY.
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Pharmacy same‑store sales +3.9%; prescription drugs +5.1%.
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Operating Performance
- Operating income before depreciation & amortization: $482.6 M (9.1% of sales), up 0.2 pp vs. FY 2025 Q1.
- Gross margin unchanged at 19.7% YoY.
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Operating expenses rose to 10.5% of sales (up from 10.3%); excluding $20.8 M direct shutdown costs, expense would have been 10.2%.
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Shutdown Impact
- Temporary closure of the frozen‑food distribution centre in Toronto incurred $21.6 M pre‑tax direct costs (net after tax impact $15.9 M).
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Asset disposals recorded a loss of $1.2 M, including $0.8 M related to the shutdown issue.
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Depreciation & Amortization
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Increased to $143.6 M from $133.6 M YoY, driven by higher retail right‑of‑use assets and supply‑chain automation investments.
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Net Financial Costs
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Rose to $37.3 M (up from $30.7 M) due primarily to higher interest expense on net debt.
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Income Taxes
- Tax expense $75.4 M, effective tax rate 25.0% (up from 18.2% YoY).
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Increase reflects resolution of prior‑year tax positions and a provincial tax holiday benefit in FY 2025.
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Earnings per Share
- Fully diluted EPS: $1.05 (‑9.5% YoY).
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Adjusted fully diluted EPS: $1.16 (+5.5% YoY).
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Normal Course Issuer Bid
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Up to 10 M shares may be repurchased Nov 2025–Nov 2026; as of Jan 16 2026, 1 M shares bought at an average price of $98.72, total cost $98.7 M.
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Dividend
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Quarterly dividend declared $0.4075 per share, up 10.1% versus last year’s payout.
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Outlook
- Operations have fully resumed after the Toronto freezer shutdown.
- Target to open ~12 new or converted discount‑store locations during FY 2026.
Notable Quotes
“We delivered sales and earnings per share growth in a challenging operating environment, marked by the temporary closure of our freezer in Toronto and persistent food inflation… we are confident that our diversified business model … will continue to deliver long term growth for our shareholders.” – Eric La Flèche, President & CEO.