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Essentially, the grocery industry siphoned away much of the dormant restaurant industry’s sales — and despite schools and businesses reopening across the country, grocers are hoping to hang on to some of that business.
“It’s clear that many Canadians food habits remain changed, and we predict will stay changed, due to severity and length of COVID concerns,” Medline said.
But Empire’s earnings report showed the boost it was getting from the pandemic is starting to wear off slightly.The retail chain’s same store sales — a key retail metric — have been slowly levelling out after huge gains in the spring and summer. In the quarter, same store sales grew by 11 per cent excluding fuel, up from 2.4 per cent a year earlier. But more recently, in the 14 weeks ended Sept. 5, same store sales have hovered between eight and 10 per cent.
“Looking ahead, we believe same store sales may slow down a bit further,” Medline said, adding that he expects some of business that shifted from the hospitality industry to stick in the grocery sector. “Grocery sales are still significantly higher than historic levels.”
Some customers are beginning to initially feel safe enough to shop a little more frequently
CEO Michael Medline
Empire’s food sales were $7.4 billion, up $610 million from last year. RBC Capital Markets analyst Irene Nattel said she had expected the sales to moderate, while still staying higher than before the pandemic.
The recent same store sales growth of eight to 10 per cent was “in line with expectations and broader industry trends as restaurant and foodservice tonnage remains well below historical level,” Nattel wrote in a note for investors on Thursday.
