Metro outlines the financial challenges posed by a weakening Canadian dollar and potential trade tariffs with the US
Metro is bracing for potential price hikes as the Canadian dollar continues to weaken and trade tensions with the US raise concerns about future tariffs, according to a report by BNN Bloomberg.
The grocery and drugstore retailer is closely monitoring the shifting economic landscape, particularly as the US remains a crucial supplier of fresh food to Canada during this time of year.
Metro CEO Eric La Flèche acknowledged the pressure from currency fluctuations, noting, "The dollar is the big worry," during a press conference after the company’s annual general meeting.
He highlighted the challenges Metro faces in an environment where a weaker Canadian dollar increases costs, particularly for products not produced locally. "We’re feeling that pressure," he added, noting that certain fresh items are only available through imports.
Metro is focusing on its ability to source locally where possible, but La Flèche pointed out that some goods, especially during the winter months, must be imported.
BNN Bloomberg reported that the Canadian dollar’s decline has been ongoing, driven in part by interest rate differences between Canada and the US.
In addition, the possibility of tariffs under President Donald Trump's administration—coupled with potential retaliatory measures from Canada—has added another layer of uncertainty to the cost of goods.
Despite these external pressures, La Flèche remains hopeful that a potential trade war won’t directly affect food prices. He acknowledged, however, that "it’s a very volatile situation," and said Metro would need to "wait and see" how the trade situation develops.
In the meantime, Metro is positioning itself for continued growth. Following what La Flèche described as a “transition year,” the company is looking to capitalize on supply chain investments made in 2024.
These improvements are expected to drive efficiency and enable Metro to better meet customer demand.
Metro also plans to continue expanding its Moi rewards program, which launched in Ontario last year, and pursue further retail network growth.
La Flèche shared that Metro intends to open 12 new stores in 2025, the majority of which will be discount outlets. He said that these stores are seeing stronger sales growth compared to conventional stores.
Metro also reported financial gains for the first quarter of its fiscal year. The company’s profit increased to $259.5 million, up from $228.5 million in the same quarter last year. This translates to $1.16 per diluted share, compared to $0.99 in the prior year. Quarterly sales reached $5.12 billion, an increase from $4.97 billion in the same period in 2024.
Same-store sales for food grew by 1%, with a 2.4% increase after adjusting for a shift in Christmas shopping days. Pharmacy sales showed a 5.1% increase, driven by a 7.3% jump in prescription drug sales. Front-store same-store sales increased 0.5%, or 1.9% when accounting for the shift in shopping days.
The company also raised its quarterly dividend to 37¢ per share, up from 33.5¢.
