Even if the COVID-19 has led to a surge in its sales, Loblaw saw its profit be sealed by the pandemic, which has resulted in an increase of its operating costs in the second quarter of 2020.
The company who owns the grocery store chain of the same name, as well as Shoppers Drug Mart/Pharmaprix has recorded a profit down 40.9 % compared to the same period last year. They were $ 169 million for the three-month period that ended on 13 June, a plunge of $ 117 million compared to the second quarter of 2019.
This drop in profits comes despite an increase in sales which have risen from 824 million, or 7.4 %, compared to the same quarter a year earlier. The revenues are just below $12 billion.
“Loblaw has delivered a strong performance on the operational level, our core business and our pillars of strategic growth, having delivered a good performance, in spite of the exceptional circumstances arising from the pandemic COVID-19. The many investments we have made in order to ensure the safety and well-being of the whole world have been able to meet the expectations of the customers, but they have also had a negative impact on our results,” said Galen G. Weston, executive chairman of Loblaw Companies Limited, by issuing a press release on Thursday morning.
This decline in earnings was expected, stressed the retailer. He is said to have spent $ 282 million due to the COVID-19, including nearly $ 180 million for bonuses salary of temporary. These costs, however, are known to decrease.
The boss of Loblaw has specified that the company “has significantly strengthened its position in the field of e-commerce, online sales of food products increased by 280 %” compared to the second quarter of 2019.