Canadian Grocer Empire Co.’s Net Earnings Drop 38%

Empire Company (EMP.A) has reported that its net earnings fell by 38% in its most recent quarter to $125.7 million.

The parent company of the Sobeys grocery store chain said that inflation, waning demand due to inflation, and a cyberattack negatively impacted its business in its fiscal third quarter.

Empire said its net earnings amounted to $125.7 million, down 38% compared with $203.4 million a year earlier.

Earnings per share (EPS) for the quarter ended February 4 of this year amounted to $0.49, down 43% from $0.77 a year ago.

Revenue rose slightly to $7.49 billion compared with $7.38 billion in the previous quarter, driven largely by the expansion of FreshCo in Western Canada and increased fuel sales.

Stellarton, Nova Scotia-based Empire said it is still recovering from a cyberattack that shutdown its pharmacy services and hampered self-checkout machines and the redemption of loyalty points across its network.

The company said the estimated cost of the cyberattack on its latest earnings was $39.1 million. Empire said the attack temporarily reduced sales and continues to hurt its operations.

Empire’s stock is down 20% over the last 12 months and trading at $34.90 per share.