Loblaw Co. Ltd. reported increased earnings and sales for the third quarter, with its discount banners outperforming conventional stores as consumers continue to search for value amid high

grocery prices . The company on Wednesday released its earnings results for the quarter ended Oct. 4, reporting revenue growth of 4.6 per cent to $19.4 billion, compared to $18.5 billion in the third quarter of 2024.

It said its food retail business attracted more customers and larger baskets in Q3, resulting in supermarket and discount banners outperforming other business sections on tonnage market share growth.

Chief executive Per Bank said, however, that consumer behaviour appears to be as it was in previous months.

“Customers continue to navigate through inflation and keeping their costs low. And, of course, (some are) shifting to discount,” he said during Wednesday’s earnings call. “Customers are still shopping more and more in hard discount, but we are not seeing it accelerating,”

The chief executive said that following the removal of Canadian counter-

tariffs in September, related cost increases and corresponding “T” (for tariff) labels were removed from shelves. He said the “T” initiative, introduced in the summer, received a lot of positive feedback from customers hoping to make informed decisions on tariff-affected products.

Bank added that the grocer sought and has now added more than 200 new Canadian vendors since the start of the year, due to widespread “

buy Canadian ” sentiment. He said that since counter-tariffs were removed, prices on products imported directly from the United States have returned to normal.

“We are seeing some customers who are going back to those products that they love, now that they are much cheaper than they were, and that will have some impact on Canadian sales overall,” Bank said.

The company’s operating income was $1.38 billion, up 4.2 per cent from the previous year. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $2.2 billion, an increase of 7.2 per cent.

Net earnings were $794 million, up 2.2 per cent, while diluted net earnings per common share were $0.66, a 4.8 per cent increase that included the impact of charges associated with the wind-down of the Theodore & Pringle optical business of $22 million.

On an adjusted basis, net earnings were $828 million, an increase of eight per cent, and adjusted diluted net earnings were $0.69 per share, an increase of 11.3 per cent.

Retail sales were up 4.5 per cent to $19.1 billion in the third quarter. Drug retail sales increased 3.8 per cent to $5.5 billion and same-store sales increased by four per cent.

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Same-store food sales and food revenue were a “string bean shy” of forecast, Royal Bank of Canada analyst Irene Nattel, said in a note.

Food retail sales were up 4.8 per cent to $13.6 billion and same-store sales up by two per cent, missing the three per cent growth forecast.

Loblaw chief financial officer Richard Dufresne said the company’s top line growth was strong in the third quarter, as it opened 76 new stores over the past 12 months, increasing retail square footage by two per cent on a consolidated basis.