Metro (MRU) Q3 2026 earnings summary

Executive summary

• Third quarter sales rose 1.4% year-over-year to $6,970.4 million, but net earnings fell 34.6% to $211.3 million, with adjusted net earnings down 20.9% to $262.6 million, due to a significant labour conflict at the Laval produce distribution centre.

• Adjusted EPS for Q3 was $1.24, down 18.4% year-over-year, with an estimated strike impact of $0.32 per share and $66 million after-tax.

• Food same-store sales declined 1.5%, while pharmacy same-store sales grew 4.8%, with prescription sales up 6.4% and online food sales up 16.3%.

• Ongoing restructuring and network optimization, including store conversions and e-commerce evolution, are expected to improve long-term profitability.

• CEO announced retirement at fiscal year-end, with a succession plan in place.

Financial highlights

• Q3 gross margin was 18.8%, down from 19.8% last year, mainly due to strike-related lost profits and costs.

• Operating income before depreciation, amortization, and impairment was $555.7 million (8.0% of sales), down 15.3% year-over-year.

• Adjusted EBITDA was $581.4 million, down 11.3% year-over-year, representing 8.3% of sales.

• Operating expenses rose to 10.4% of sales in Q3, up from 10.2% last year.

• Cash inflows from operating activities were $447.3 million in Q3, down from $680.2 million last year.

Outlook and guidance

• The ongoing Laval labour conflict continues to impact food same-store sales, which are down 1.5% after four weeks into Q4, with no clear resolution timeline.

• Network optimization and restructuring initiatives are expected to generate $15 million in recurring annual net earnings by fiscal 2028, with half realized by fiscal 2027.

• Expansion of discount banners and new store openings remain a focus for growth.