Loblaw plans click-and-collect grocery pickup

Loblaw is getting into online grocery sales this year, or at least plans to give it a try.

On Thursday company president Vicente Trius said that the retailer would run a test on “click-and-collect” grocery at three stores in the Greater Toronto Area.

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Loblaws Releases Third Quarter Earnings

2013 Third Quarter Summary(1)

• Revenue of $10,009 million, an increase of 1.9% over the third quarter of 2012.

• Retail sales growth of 1.5% and same-store sales(3) growth of 0.4% compared to the third quarter of 2012. Retail same-store sales(3) growth was negatively impacted by the timing of the Thanksgiving holiday, estimated to be 0.5% to 0.7%.

• Financial Services revenue increased by 11.0% over the third quarter of 2012.

• Choice Properties Real Estate Investment Trust (“Choice Properties”) completed an Initial Public Offering (“IPO”) of trust units (“Units”) and concurrent sale of Units to George Weston Limited (“Weston”).

• Shoppers Drug Mart Corporation (“Shoppers Drug Mart”) shareholders voted in favour of the Company’s agreement to acquire all of Shoppers Drug Mart's outstanding common shares. 

• Subsequent to the end of the third quarter of 2013, the Company announced the reduction of approximately 275 store-support positions.

The Report can be found in its entirety at Loblaws Investor Relations.

Loblaws Cuts 275 Employees

Just over 200 of the cuts are from Loblaw’s Brampton, Ont., head office. The initiatives come as Loblaw fights off low-cost U.S. discount behemoths Wal-Mart Stores Inc., Target Corp. and Costco Wholesale, while incumbents are moving to consolidate with rivals to gain efficiencies. (Globe and Mail)

Loblaw Companies Limited to acquire Shoppers Drug Mart Corporation for $12.4 billion

Loblaw Companies Limited to acquire Shoppers Drug Mart Corporation for $12.4 billion

This is an absolutely huge potential change to the Canadian retail landscape:

Key Takeaways:

1. One of the largest (if not THE largest) retail transactions in Canadian history
2. Gives Loblaws access to a huge portfolio of expensive and increasingly difficult to zone urban real estate
3. Synergies in operations and economies of scale will reduce operations costs
4. Positions itself for a larger share of pharmacy sales which are increasing strongly due to aging population
5. Prevents potential Shoppers acquisition by international pharmacy (i.e. Walgreens & Boots)
6. Loblaws can partially finance transaction by selling off redundant real estate
7. Competition bureau will need to approve this and will likely require some sites where presence is above Bureau thresholds to be sold off (see their Merger Enforcement Guidelines [pdf])
8. Loblaws will be able to roll out small footprint urban concept much faster
9. Moves Loblaw from 31st to 25th largest retailer in the world (Stores.org)

Here is our interview on BNN

Copy of joint Presentation:

ARRANGEMENT AGREEMENT
Between
LOBLAW COMPANIES LIMITED
and
SHOPPERS DRUG MART CORPORATION
July 14, 2013

From Press Release:

Transformational combination brings together two iconic businesses to deliver more choice, value, and convenience to help Canadians live life well

• Combines best-in-class pharmacy and food businesses to create a unique retailer with unmatched capabilities in health & wellness and nutrition
• Loblaw gains powerful footprint in the important and growing small-urban store sector
• Retaining its name and brand, Shoppers Drug Mart will operate as a separate division of Loblaw and expand its product offerings to include Loblaw's private label and convenience food
• Combined company generated, on a 2012 pro forma basis, revenues in excess of $42 billion, EBITDA* of $3 billion, and annual free cash flow* of $1 billion

BRAMPTON AND TORONTO, ON, July 15, 2013 /CNW/ - Loblaw Companies Limited (TSX: L) and Shoppers Drug Mart Corporation (TSX: SC) today announced a definitive agreement under which Loblaw will acquire all of the outstanding Shoppers Drug Mart common shares for $33.18 in cash plus 0.5965 Loblaw common shares per each Shoppers Drug Mart common share, on a fully pro rated basis. Using the Loblaw closing common share price on July 12, 2013, this amounts to $61.54 per Shoppers Drug Mart common share. This price represents a 29.4% premium to the 20-day VWAP of Shoppers Drug Mart common shares as of July 12, 2013.

This strategic union will enhance the companies' competitive positioning in an evolving retail landscape, creating new growth opportunities for shareholders, more and better choices for customers, and greater convenience through Shoppers Drug Mart's footprint in the important and growing small-urban store sector.

Press release

Loblaw to test new health store concept, take on Whole Foods as grocery battle heats up

TORONTO • Grocery giant Loblaw Cos. Ltd. is taking on Whole Foods in a test pilot of a new retail concept called Nutshell Live Life Well, a stand-alone franchise catering to the health-conscious crowd. The first location will open this fall in downtown Toronto, Loblaw company spokeswoman Julija Hunter confirmed on Thursday, and will include a broad assortment of prepared, fresh and packaged foods, a prescription pharmacy, natural health and beauty products, vitamins and supplements. Loblaw’s news comes a month after the CEO of Austin, Tex-based supermarket chain Whole Foods Market Inc., the world’s largest natural food retailer with nine stores in B.C. and Ontario, said it could open 40 or more Canadian locations as part of a bigger worldwide expansion. And Nutshell Live Life Well will make its debut in the midst of perhaps the most competitive year to date in Canadian grocery retail, in which all of the major players have seen their margins squeezed in a pricing war and the rapid expansion of grocery square footage from Walmart and Target.

http://business.financialpost.com/2013/07/11/loblaw-nutshell-live-life-well/