Front end boosts same-store sales for 4Q, fiscal 2016

BRAMPTON, Ontario — Sales at Shoppers Drug Mart edged up for the fiscal 2016 fourth quarter and year, with front-end business hoisting comparable-store results.

Parent Loblaw Companies Ltd., Canada’s largest food and drug retailer, said Thursday that for the fourth quarter ended Dec. 31, Shopper Drug Mart’s sales totaled $3.056 billion (Canadian), up 2.7% from $2.975 billion a year earlier.

Revenue in the front end rose 2.1% to $1.695 billion from $1.660 billion in the year-ago quarter. In the pharmacy, sales grew 3.5% to $1.361 billion from $1.315 billion. Pharmacy represented 44.5% of overall drug retail sales for the 2016 quarter.

Same-store sales were up 3.4% year over year for the fourth quarter, reflecting increases of 4.1% in the front end and 2.5% in the pharmacy. Loblaw noted that drug retail same-store sales include a 0.6% lift from an extra selling day in the quarter because of the timing of New Year’s Day.

Prescription count advanced 5% overall in the fourth quarter and 4.5% on a comparable pharmacy basis.

For the full year, Shoppers Drug Mart’s sales came in at $12.209 billion, up 3.5% from $11.797 billion in 2015.

Front-of-store revenue climbed 3.6% to $6.479 billion in 2016 from $6.252 billion in the prior year. Pharmacy sales rose 3.3% year over year to $5.730 billion from $5.545 billion. For 2016, pharmacy accounted for 46.9% of total drug retail sales.

Comp-store sales at Shoppers Drug Mart grew 4% in 2016, including gains of 5% in the front end and 2.9% in the pharmacy. Prescriptions dispensed increased 3.8% for the year and were up 3.5% on a comparable pharmacy basis.

Drug retail represented 26.9% of Loblaw’s overall retail segment sales for 2016, which rose 2.1% to $45.384 billion. Fourth-quarter retail segment sales totaled $10.845 billion, up 2.3%.

Loblaw’s food retail sales increased nearly 2.1% year over year to $7.789 billion in the fourth quarter, with same-store sales inching up 1.1% for the period. Overall food retail sales for 2016 were $33.175 billion, up 1.5% from the previous year, while comp-store sales gained 1.9%.

“We continued to lower prices, delivering more value to consumers,” Loblaw Cos. chairman and chief executive officer Galen Weston said in a statement. “Our focus on our strategic framework and financial plan delivered solid financial performance in the fourth quarter,” he added, “and demonstrated the strength of our portfolio of businesses amidst a highly competitive food retail environnment, and pressures from health care reform.”

As of Dec. 31, Shoppers Drug Mart had 1,326 drug stores, compared with 1,313 a year earlier. Loblaw finished 2016 with 565 supermarkets, most with pharmacies, as well as 533 franchised food stores.