MONTREAL — Eric LaFleche, who officially took the wheel of retailer Metro Inc. last week, is making his maiden voyage through turbulent waters.
The Canadian retailer last week said net income in its fiscal second quarter of $58 million (U.S.) was down 6% from the same period last year, while sales of $2.4 billion were an increase of 0.7%. Results were announced on the same day LaFleche assumed president and chief executive officer duties from Pierre Lesard, who is retiring. Metro first announced that transition several months ago.
“I look forward to leading this great company into the future,” LaFleche, Metro's former chief operating officer, told analysts in a conference call last week. “I inherited an outstanding team that has made Metro a great success over the years, and my responsibility is to continue along this path.”
LaFleche said results for the quarter, which ended March 15, represented a sequential improvement from the first quarter of fiscal 2008, when sales were down by 0.3%, and earnings, when adjusted for one-time events, dropped by 18%. Officials attributed those results to a fiercely competitive climate in Ontario and to a couple of internal struggles: A “learning curve” associated with new systems in Ontario, and consolidation of foodservice warehouses in Quebec.
Those issues eased a little during the second quarter, LaFleche said.
Other issues remain, however, including a plan to rationalize its conventional banners in Ontario. Metro has twice postponed an announcement on the plan — which would consolidate the multiple banners it operates in the province as a result of acquisitions — as it focuses on competitive battles. LaFleche also noted that although the rising value of the Canadian dollar has shielded the company from price inflation in recent months, recent parity with the U.S. dollar should result in price increases at retail shelves.
