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Acquisition Boosts Sobeys' Q1 Results

STELLARTON, Nova Scotia — Empire Company here said Thursday the acquisition of 236 Shell gas stations and convenience stores late last year helped boost first-quarter sales at Sobeys by 9.8%, to $4.6 billion (U.S.).

Excluding sales of $264.7 million related to the c-stores, Sobeys' sales in the 13-week quarter, which ended Aug. 4,  were up 3.6%, and same-store sales rose 1.8%, while net earnings increased 18.9% to $99.5 million.

During the quarter Sobeys accounted for 99% of Empire's sales of $4.7 billion, with the balance coming from real-estate investments.

According to Paul D. Sobey, president and chief executive officer of Empire, "Our solid first-quarter results were driven by Sobeys' operational performance, which demonstrated that our food-focused strategy is resonating with more and more customers. We remain committed to improving our cost structure and productivity and further enriching the shopping experience of our customers."

Read more: Sobeys Buys 250 Fuel Centers

Marc Poulin, who succeeded Bill McEwan as president and CEO of Sobeys in late June, said he has no plans to change the direction of the company.

"My clear focus is executing at store level, leveraging the size of the company and driving costs down — the same course set by Bill."

During the quarter, Sobeys converted two more Price Chopper stores in Ontario to the FreshCo discount format, for a total of 70 FreshCos. In response to a question, Poulin said Sobeys plans to limit that banner to Ontario "to make the most of our capital investment before moving on to other opportunities."

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