Metro Inc.

Third-quarter sales were $6.97 billion, up 1.4% year over year. Gross profit was $1.3 billion, or 18.8% of sales, versus 19.8% last year. EBITDA was $555.7 million, down 15.3%, and adjusted EBITDA was $581.4 million, down 11.3%, or 8.3% of sales versus 9.5% last year. Adjusted net earnings were $262.6 million, down 20.9%, and adjusted diluted EPS was $1.24, down 18.4% from $1.52. The company said the quarter was impacted by an estimated $90 million of lost profit and incremental direct costs from the Laval strike, or about $0.32 per share after tax. For the fourth quarter, management said food same-store sales were running at minus 1.5% after four weeks and that results would continue to be significantly affected while the conflict persists. Management also laid out expected recurring annual after-tax earnings of $15 million by the end of fiscal 2028 from the network changes, with about half realized by the end of fiscal 2027.

Eric La Flèche framed the quarter as operationally difficult because of the Quebec labor conflict, but said the contingency plan is steadily improving and stores are generally well stocked. He emphasized Metro’s commitment to a negotiated agreement, while insisting the company will not compromise on long-term competitiveness or market discipline. He also highlighted continued momentum in pharmacy, online growth, and store investment, and said the company will keep focusing on restoring traffic and execution.

Nicolas Amyot said the quarter included pretax nonrecurring restructuring expenses of $25.7 million and asset impairments of $32.1 million tied to the network optimization program, resulting in a $42.6 million after-tax adjustment, or $0.20 per share. He quantified the strike impact at about $90 million, with roughly one-third of that tied to direct contingency-plan costs and two-thirds to lost margin on lost revenue, and noted $3 million of direct costs in the quarter. He also said Q3 capex was $167.3 million, the annual capex envelope remains $500 million to $550 million, and share repurchases totaled 4.9 million shares for $463.1 million at an average price of $94.56.

Analysts focused heavily on the strike, asking whether Ontario was holding up better than Quebec, how much of the $90 million impact was still ongoing, and whether negotiations with the union had restarted. Management said Ontario is holding share, but there were some operational disruptions from supporting Quebec stores, and it said there had been no formal negotiations for a few weeks although Metro remains ready to resume talks in a realistic framework. Questions also centered on the new banner conversions and the e-commerce shift; management said the 10-store Food Basics conversion plan is spread across Ontario, should improve contribution after conversion, and that the dark-store closure in Montreal should reduce fixed costs and support more profitable online grocery over time. Analysts also asked about GLP-1 economics, and management clarified that generic semaglutide is causing price deflation but unit volumes are rising, with low-teens dollar contribution growth expected for the category.