Big gains ahead for Loblaw

Article Excerpt

Loblaw continues to restructure its business. That includes upgrading its inventory-management and computer systems, and streamlining its distribution networks. Higher profits should be in store as it finishes paying for the restructuring, and operates more efficiently. LOBLAW COMPANIES $39.72 (Toronto symbol L; Shares o/s: 278.4 million; Market cap: $11.1 billion; TSINetwork Rating: Above Average; Dividend yield: 2.1%; is Canada’s largest food retailer. It now has around 1,000 company-owned and franchised stores. George Weston Ltd. owns 62% of Loblaw’s shares. In the three months ended October 9, 2010, Loblaw’s earnings per share rose 11.6%, to $0.77 from $0.69 a year earlier. Restructuring costs lowered its earnings per share by $0.12 in the latest quarter. Overall sales rose 1.3% in the latest quarter, to $9.6 billion from $9.5 billion. The gain was largely due to T&T Supermarket Inc., Canada’s largest Asian food retailer, which Loblaw bought in 2009. Loblaw’s same-store sales fell 0.4%. Lower sales of drugs and general merchandise offset stronger clothing sales…

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