(Adds details on online expansion)
By Akshara P
May 2 (Reuters) - Canada’s Loblaw Cos Ltd reported a better-than-expected quarterly profit on Wednesday and said it plans to expand its online grocery services in the country amid increasing competition from Amazon.com Inc.
Like many other Canadian retailers, Loblaw has lost market share to bigger U.S. rivals like Amazon and Walmart.
“As the retail landscape changes, we are now rapidly scaling our e-commerce pick-up and home delivery services to blanket Canada this year,” Chief Executive Officer Galen Weston said in a statement.
The company, which sells everything from grocery to wireless mobile connections, said 70 percent of Canadians will have access to its pick up and home delivery services by the end of the year, from the current 50 percent.
The company’s first-quarter profit beat was driven by a rise in same-store sales in its food and drug retail businesses.
Loblaw was able to attract more customers to its food retail stores as it managed to keep prices low. Food retail same-store sales grew 1.9 percent in the quarter, compared with a fall of 1.2 percent a year earlier.
“The increase in food retail same-store sales reflected both an increase in ticket and traffic,” Raymond James analyst Kenric Tyghe said in a note.
Same-store sales in its drug retail business rose 3.7 percent.
Net profit available to common shareholders jumped nearly 63 percent to C$377 million ($293.66 million), or 98 Canadian cents per share, in the quarter ended March 24.
Excluding certain items, the company earned 94 Canadian cents per share, beating the average analyst estimate of 91 Canadian cents, according to Thomson Reuters I/B/E/S.
Revenue fell to C$10.37 billion from C$10.40 billion. ($1 = C$1.28) (Reporting by Akshara P in Bengaluru; Editing by Maju Samuel)