STELLARTON, NS – Today Empire Company Limited (“Empire” or the “Company”) (TSX: EMP.A) announced the locations of six additional FreshCo store investments in British Columbia (“B.C.”) as part of its discount format expansion into Western Canada. The announcement follows five successful FreshCo openings in B.C. and Manitoba earlier this Spring. In fiscal 2018, the Company shared plans to expand FreshCo into the West by converting approximately 25% of its underperforming Safeway and Sobeys locations over a five year period.
“Western Canada is responding extremely well to our smaller box discount format,” said Michael Medline, President & CEO, Empire Company Ltd. “We’ve been hyper-focused on selecting the right locations for FreshCo stores and are converting poorly performing Safeway and Sobeys stores. Opening FreshCo stores in these locations is allowing us to not only leverage existing real estate within our network, but also win market share we simply couldn’t compete for in the past.”
The Company opened its first FreshCo in Western Canada in Mission, B.C. on April 25, 2019, quickly followed by two store openings in Winnipeg, Manitoba on May 2. Two additional FreshCo stores opened in Richmond, B.C. on May 16 and a further two stores will open in Surrey, B.C. in July 2019.
“Customer response to our first five FreshCo locations in B.C. and Manitoba has been overwhelmingly positive,” said Mike Venton, General Manager, Discount. “Discount is the fastest growing retail segment and we’re now participating in a meaningful way in Western Canada, providing customers with more choice and market leading low prices. Customers have been very excited about our international product offering and easy-to-shop store format and we’re ready to continue building on our progress in B.C. and Winnipeg.”
The six future FreshCo store locations announced today, all in British Columbia, are: 100 Mile House (closing October 5, 2019), Williams Lake, Kamloops Sahali, Kelowna Dilworth, Vernon Downtown, and Powell River (all closing November 23, 2019).
The FreshCo stores are expected to open in Spring 2020, depending on the timing of construction schedules and permits. Store closure costs of the Safeway stores that will be converted to FreshCo stores will be charged to earnings in the first quarter of fiscal 2020. Announced separately today, the Sobeys Urban Fresh Metcalfe store in Ottawa, Ontariowill convert to a Farm Boy. The combined closure costs related to these conversions are estimated to be approximately $15 million, which will be charged to operating earnings in the first quarter of fiscal 2020.
Click here for a full list of the 18 FreshCo store locations confirmed to date.
Empire Company Limited (TSX: EMP.A) is a Canadian company headquartered in Stellarton, Nova Scotia. Empire’s key businesses are food retailing, through wholly-owned subsidiary Sobeys Inc., and related real estate. With approximately $24.8 billion in annualized sales and $9.3 billion in assets, Empire and its subsidiaries, franchisees and affiliates employ approximately 125,000 people.
This document contains forward-looking statements which are presented for the purpose of assisting the reader to contextualize the Company’s financial position and understand management’s expectations regarding the Company’s strategic priorities, objectives and plans. These forward-looking statements may not be appropriate for other purposes. Forward-looking statements are identified by words or phrases such as “anticipates”, “expects”, “believes”, “estimates”, “intends”, “could”, “may”, “plans”, “predicts”, “projects”, “will”, “would”, “foresees” and other similar expressions or the negative of these terms. These forward-looking statements include, but are not limited to, the following items:
- The FreshCo expansion in Western Canada, including the Company’s expectations regarding future operating results and profitability, the amount and timing of expenses, and the number, location, feasibility and timing of conversions, all of which may be impacted by construction schedules and permits, the economic environment and labour relations; and
- The conversion of a Sobeys store to Farm Boy including the Company’s expectations regarding the amount and timing of expenses, which could be impacted by construction schedules and permits and the economic environment.
By its nature, forward-looking information requires the Company to make assumptions and is subject to inherent risks, uncertainties and other factors which may cause actual results to differ materially from forward-looking statements made. For more information on risks, uncertainties and assumptions that may impact the Company’s forward-looking statements, please refer to the Company’s materials filed with the Canadian securities regulatory authorities, including the “Risk Management” section of the fiscal 2018 annual MD&A.
Although the Company believes the predictions, forecasts, expectations or conclusions reflected in the forward-looking information are reasonable, it can provide no assurance that such matters will prove correct. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward looking information and are cautioned not to place undue reliance on such forward-looking information. The forward-looking information in this document reflects the Company’s current expectations and is subject to change. The Company does not undertake to update any forward-looking statements that may be made by or on behalf of the Company other than as required by applicable securities laws.