Grocer Metro on Wednesday reported third-quarter profits of $275 million, up 9% from a year earlier.
Profits were largely driven by pharmacy sales.
“We had very strong in-store sales at our Jean Coutu and Brunet pharmacies during the quarter,” Metro President and CEO Eric La Flèche said during a call to discuss the results of the business in the third quarter. “Over-the-counter cough and cold products are flying.”
Overtime accumulates in a context of labor shortage
But workers are working overtime to keep stores open as the company grapples with an ongoing labor shortage, the Montreal-based chain’s president said.
“There are a lot of vacancies and there are not enough workers to fill them.”
La Fleche said there were “more vacancies than we are used to”, but declined to provide the exact number of vacancies in the company’s warehouses and stores, which include conventional supermarkets. such as Metro and Metro Plus, the Super C discount grocery chains in Quebec. and Food Basics in Ontario, and Jean Coutu and Brunet pharmacies.
“Labour shortages create pressures (…) because it increases overtime to supply our stores,” La Flèche said. “We have higher overtime percentages than we are used to.”
Metro’s chief financial officer, Francois Thibault, warned that inflationary pressures and labor shortages could start to weigh on margins.
“If this environment of high inflation and high prices continues, it will continue to put pressure on margins,” he said.
For now, Thibault said, strong margins in the company’s pharmacy division have offset a decline in food gross margin.