Loblaw says it made more than $1B in sales compared to the same time last year
The company behind Loblaws, Shoppers Drug Mart, T&T;, No Frills, Real Canadian Superstore and dozens of other major retail chains across Canada has released hard data that proves just how widespread "panic buying" behaviour has grown in recent months.
Loblaw Companies Limited, the country's largest food retailer by far, stated in a release announcing its first quarter financial results on Wednesday that overall revenues were up a whopping $1.14 billion in the first three months of 2020 compared to the same period of time last year.
This represents an increase of 10.7 per cent, bringing revenues for the first quarter of the year to roughly $11.8 billion.
When broken down by retail category, same-store sales growth for "food" was up about 9.6 per cent, year over year, while "drug" — ie; the kind of stuff sold at Shoppers — was up 10.7 per cent.
It is not publicly known how much of these revenue spikes can be attributed to toilet paper.
What we do know is that investors are raking it in (at least when it comes to this particular stock) on account of the coronavirus pandemic in the form of diluted net earnings per common share.
Long story short: Loblaw share prices are up 24.5 per cent, year over year, thanks in large part to panic buying.
"Late in the quarter the company experienced unprecedented consumer demand and stockpiling relating to COVID-19, with sales surging in the final two weeks of March," reads the release issued by Loblaw this morning.
"The result was both a sharp increase in revenue and profit followed by ramp-up in spending to protect and benefit colleagues and customers."
Loblaw said on Wednesday that, despite the initial sales surge in March, demand has now moderated — albeit with "continued strength" in both essential food categories and pharmacy items.
The company also says it has been investing more money since the beginning of Q2 on such COVID-19 response measures as temporary pay premiums, extra safety protections for staff, increased store cleaning and expanded e-commerce offerings.
"Uncertainty over the duration and severity of the pandemic make reliable estimates of the second quarter and full-year COVID-19 related impacts on the financial results and operations of the Company impossible," reads the Loblaw release, echoing the sentiments of almost every other company in existence right now.
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