MONTREAL -- Grocer Metro Inc. boosted its quarterly dividend nearly 11 per cent after beating expectations with higher earnings and revenue in the first quarter of its fiscal year.
The Montreal-based company will pay 18 cents per share on March 13, up from 16.25 cents in the prior quarter. On an annualized basis, the dividend equals about 27 per cent of its 2017 net earnings.
Metro started its year by earning nearly $1.3 billion or $5.67 per share, boosted by the sale of its stake in Alimentation Couche-Tard Inc. to help fund its deal to buy the Jean Coutu Group Inc.
The result compared with a profit $138.1 million or 58 cents per share in the same quarter a year earlier.
Metro CEO Eric La Fleche said the good results were achieved in a highly competitive market in Quebec and Ontario, where it operates.
"We remain vigilant and agile to meet evolving customer needs and are confident in our long-term growth plans," he said in a news release ahead of the company's annual meeting.
La Fleche added that teams at Metro and Jean Coutu are working to prepare a "smooth combination" once regulatory approvals are received.
Sales for the 12 weeks ended Dec. 23 totalled $3.11 billion, up from $2.97 billion.
Same-store sales, a key retail measurement of the performance of existing locations, were up 3.4 per cent or 1.2 per cent excluding the inclusion of the Christmas week.
On an adjusted basis, Metro said it earned $153.4 million or 67 cents per share, up from $138.1 million or 58 cents per share a year ago.
Analysts on average had expected a profit of 59 cents per share and $3.02 billion in revenue, according to Thomson Reuters.
Irene Nattel of RBC Capital Markets described the solid results as a "tasty start" to fiscal 2018.
