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Plus, CPKC sees more Canada-Mexico trade flows, Bombardier expects high demand for business jets, and more. Here are the details for Canadian investors.
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Loblaw Cos. Ltd. says it’s still working to stock its grocery store shelves with more Canadian products as shoppers look for local alternatives during the Canada-U.S. trade war, but the company’s chief executive admits the shift may not last.
“We recognize that Canadians care deeply about the region of the product they purchase and we continue to actually seek out Canadian growers and manufacturers for the products we sell,” Loblaw president and CEO Per Bank told analysts on a conference call Wednesday, as the company reported its first-quarter profit rose compared with a year ago.
While Bank said it’s difficult to gauge consumer preferences in-store, data from Loblaw’s online grocery service shows a clear pivot by shoppers toward the “Buy Canadian” movement that has gained momentum since U.S. tariffs went into effect.
He said less than 4% of PC and No Name brand products come from the U.S.
“Just before this meeting, I was down in the test kitchen and I was observing that they are testing a lot of new products,” Bank said.
“They have been really, really busy to help mitigate the tariff situation so we can buy less from the U.S.”
With tariffs adding to pressure on the cost of some food items and other essentials, Bank said the grocery retailer is “working diligently to keep prices as low as possible.”
Earlier this year, Loblaw began highlighting domestic products in its stores while also marking products that have seen price hikes due to tariffs. It also added a “swap and shop” feature to its loyalty app to help shoppers find Canadian products more easily.
Asked if he anticipates the “Buy Canadian” trend will persist, Bank said he was hopeful, but predicted that “maybe a third of it will stick” long term. He said price and quality are still the most important factors customers consider when choosing which products to buy.
“If price and quality is best (for) a Canadian product, then they choose those, but if it’s a foreign product, they will choose that,” said Bank.
“Right now, they prefer Canadian products. I would say if the price is almost the same, like up to 5% different, then customers buy Canadian, so I hope it sticks.”
The parent company of Loblaws and Shoppers Drug Mart said it also continued seeing strong customer response to loyalty offers and promotions during the quarter.
Its net earnings available to common shareholders amounted to $503 million or $1.66 per diluted share for the quarter ended March 22. The result was up from a profit of $459 million or $1.47 per diluted share in the first quarter of 2024.
On an adjusted basis, Loblaw says it earned $1.88 per diluted share in its latest quarter, up from an adjusted profit of $1.72 per diluted share a year earlier.
Analysts on average had expected an adjusted profit of $1.87 per diluted share, according to LSEG Data & Analytics.
RBC analyst Irene Nattel called it “another solid quarter” for Loblaw, saying its key performance indicators were generally in line with expectations. She said that points to sustained momentum for the company.
Revenue for the quarter totalled $14.1 billion, up from $13.6 billion, as food retail same-store sales rose 2.2%. Drug retail same-store sales rose 3.8%, with pharmacy and health care services same-store sales up 6.4%, and front store same-store sales increasing 0.9%.
In February, Loblaw announced plans to spend $2.2 billion in 2025 to open 80 new grocery stores and pharmacies with about 50 of them being discount grocers. Bank had said many would be smaller-format stores, building the company’s network of those types of grocers after launching small-format No Frills stores for the first time last May.
Ten of those stores opened last quarter with the same amount planned for the second quarter, while the remaining 60 will open in the second half of this year.
Bank said the company is encouraged by the early performance of its newest locations, with the majority “living up to our expectations.”
“If the new stores wouldn’t be working, then I would not open one more store,” he said.
“So the moment we see it won’t work, then of course we will stop building new stores. But trust me, that will work the next five years because customers, they’re asking for lower prices, they’re asking for hard discounts.”
The investment, which is part of about $10 billion over five years, will also add 100 pharmacy care clinics to the company’s network. Loblaw opened 52 new stores in 2024 as well as 78 new clinics.
Loblaw also said Wednesday that its dividend rose to 56.4 cents per common share, an increase of 10%, marking the 14th consecutive year of dividend increases.
Canadian Pacific Kansas City Ltd. has reined in its financial forecast for the year due to the lingering fog around U.S. tariffs and trade policy, as the railway hunts for workarounds to an array of trade barriers.
“It’s an all-out blitz, literally, to do everything we can to make our own luck as all this uncertainty unfolds on the tariff front,” said chief marketing officer John Brooks, highlighting a 60-day sales push to meet with more than 500 customers.
On the heels of a 17% year-over-year surge in profits last quarter, chief executive Keith Creel said new shipping flows between Canada and Mexico have already started to emerge from “this trade storm.”
Canadian producers are sending more refined fuels, liquefied petroleum gas, plastics and grains to Mexico, he told analysts on a conference call Wednesday.
“There’s over $100 million of new revenue that this crisis has created that originates in Alberta that goes to Mexico.”
Meanwhile, CPKC can haul more appliances, furniture, food and vehicles directly to Canada from south of the Rio Grande. Creel stressed the chance to ship more consumer products between the two countries when “the middleman is redundant.”
“A lot of these products in this case are produced in Mexico. Then they’re trucked to the United States to be packaged and labelled and warehoused, and then trucked out of the United States to go across the border onto the Canadian shelves,” he said, noting that such supply chains can inflate prices.
“That creates opportunities.”
Nonetheless, the country’s second-biggest railway faces the threat of potential economywide contraction—U.S. economic output shrank last quarter—and unpredictability around shifting tariffs.
On Thursday, CPKC lowered its financial outlook for 2025, saying it now expects adjusted diluted earnings per share to increase between 10% and 14% this year, rather than 12% to 18% as previously predicted.
Creel cited “increasing uncertainty created by evolving trade policies and the heightened risk of economic recession.”
In late January, the CEO had forecast “exceptional growth between the three nations” while acknowledging possible “volatility” ahead.
As the only freight railway to span all three countries in North America, CPKC has an especially keen interest in whether the White House persists with a trade war.
Brooks pointed to “choppiness” in auto shipments after U.S. President Donald Trump imposed 25% tariffs on imports from Canada and Mexico. But volumes have since smoothed out, he said, with broad exemptions and rebates applicable to many carmakers.
Duties of 25% for steel and aluminum imports pose another risk for carriers. But despite denting volumes into the U.S. from Canada, the move served to redirect Mexican steel product shipments to Canadian buyers, offering a partial offset, Brooks said.
Sky-high U.S. tariffs on most Chinese products have disrupted some transpacific shipments, he added. But overall cargo volumes—as measured in revenue ton miles, a key metric gauging how many tons of freight are hauled in a mile—rose or stayed flat across all categories last quarter.
On Thursday, CPKC reported first-quarter net income increased to $909 million versus $774 million the year before.
Revenues grew 8% to $3.80 billion in the three months ended March 31 from $3.52 billion in the same period a year earlier, the Calgary-based company said.
On an adjusted basis, core diluted earnings rose 14% to $1.06 per share from 93 cents per share, slightly beating analysts’ expectations of $1.04 per share, according to financial markets firm LSEG Data & Analytics.
In the face of tariffs, trade uncertainty and a potential recession, Bombardier Inc. chief executive Éric Martel is feeling upbeat.
He pointed on Thursday to the business jet maker’s “strong start to the year” and a bright financial outlook that foresees higher revenue, profits and plane deliveries this year.
The Montreal-based company expects to crank out more than 150 aircraft in 2025 versus 146 last year.
Martel also anticipates a revenue boost of at least 7% to more than $9.25 billion and an adjusted earnings increase of 14% to more than $1.55 billion. (All figures in U.S. dollars.)
The confident tone marks a striking change from three months ago, when Bombardier held off on giving financial guidance due to the uncertainty posed by U.S. President Donald Trump’s tariff threats.
“We need to exercise caution until we see how this all unfolds,” Martel said on Feb. 6, adding that he was “very disappointed” he could not provide targets.
Since then, Bombardier has achieved “tariff clarity,” he told analysts on a conference call Thursday.
Its planes comply with the United States-Mexico-Canada Agreement, exempting them for now from 25% tariffs, the CEO said.
Its book-to-bill ratio—a measure of orders received to sales billed, a key indicator of near-term demand for a company’s services—dipped only slightly to 90% in its latest quarter.
Concern around 25% duties on steel and aluminum imports into the U.S. have plagued the aerospace sector in recent months, but Martel said any extra costs were factored into its forecast.
“Bombardier and business aviation as a whole are resilient. There are dozens if not hundreds of major international trade deals to be done around the world in the immediate future,” he said.
On Thursday, Bombardier reported a first-quarter profit of $44 million, down from $110 million the year before.
Revenue in the three months ended March 31 rose 19% to $1.52 billion from $1.28 billion in the same period a year earlier, the company said.
On an adjusted basis, it earned 61 cents per share versus last year’s 36 cents per share. However, the outcome notched lower than analysts’ expectations of 66 cents per share, according to financial markets firm LSEG Data & Analytics.
The company’s order backlog ticked down 1% to US$14.2 billion.
Samsung Electronics reported Wednesday a sharp increase in consolidated revenue for the first quarter thanks to strong sales of its new smartphones, but its semiconductor business suffered a setback.
The South Korean semiconductor and smartphone giant said in a statement that it posted 79.14 trillion won (USD$56 billion) in consolidated revenue for the January-March quarter, calling it an all-time quarterly high. It said its operating profit rose to 6.7 trillion won (USD$4.7 billion), up from 6.61 trillion won (USD$4.6 billion) in the same period last year.
Samsung attributed the results to strong sales of its flagship Galaxy S25 smartphone and other high-value-added products.
The company said its profits were squeezed by falling average sale prices, as well as reduced demand for high-bandwidth memory as customers wait for the release of next-generation memory chips.
(All figures in U.S. dollars.)
Coca-Cola reported better-than-expected earnings in the first quarter and said the impact of tariffs on its business are likely to be “manageable.”
Coke and other beverage makers are facing a 25% tariff on the aluminum they use for cans, among other items. Last week, rival PepsiCo lowered its full-year earnings expectations due to the impact of tariffs.
“Based on what we know today, the dynamic tariff landscape could impact pockets of our system’s cost structure, as well as consumer sentiment in our markets,” Coke Chief Financial Officer John Murphy said Tuesday in a conference call with investors.
But Murphy said Coke has “numerous levers to help manage the impact.” The company has said previously that it may shift aluminum suppliers or rely more heavily on plastic or glass bottles.
Coke’s unit case volumes grew 2% in the first quarter, led by higher demand in China, India and Brazil. Coca-Cola Zero Sugar was a standout, with case volumes up 14%. Demand for sports drinks and coffee fell.
In North America, case volumes fell 3%. Prices rose 8%, partly because Coke sold a higher mix of premium beverages like Topo Chico sparkling water and Fairlife milk.
Coke Chairman and CEO James Quincey said a video that was circulating on social media in February hurt U.S. sales, particularly among Hispanic consumers in the South. The video claimed that Coke was reporting its own workers to U.S. Immigration and Customs Enforcement officers and called for a boycott of the company.
Quincey said the claims in the video were false and the controversy has largely abated. Coke is trying to win back Hispanic sales by promoting the company’s local economic impact and offering targeted deals, he added.
The video aside, Quincey said there was a pullback in purchasing on both sides of the U.S.-Mexico border due to consumer uncertainty.
“I think some of the geopolitical tension was just causing people to be a little more cautious with their spend,” he said “A little less going out, a little more keeping the money in the pocket.”
Revenue fell 2% to $11.1 billion in the January-March period, the company said Tuesday. Adjusted for one-time items, including currency fluctuations, Coke reported revenue of $11.2 billion. That beat Wall Street’s expectation of $11.15 billion, according to analysts polled by FactSet.
Net income rose 5% to $3.3 billion for the quarter. Adjusted for one-time items, the Atlanta company earned 73 cents per share. That beat expectations of 72 cents.
Coke moderated expectations for its full-year profit Tuesday. The company said it now expects full-year adjusted earnings to grow 7% to 9%, down from 8% to 10% previously. Coke earned $2.88 per share in 2024.
Shares of Coca-Cola rose less than 1% in Tuesday morning trading.
(All figures in U.S. dollars)
Gildan Activewear Inc. saw its earnings rise to $84.7 million in its latest quarter. (All figures in U.S. dollars.)
The Montreal-based apparel maker, which keeps its book in U.S. dollars, says the first-quarter profit compared with net earnings of $78.7 million a year earlier.
On an adjusted basis, Gildan says it earned $89.8 million in the quarter, compared with $99.1 million a year ago.
Those figures translated to adjusted earnings of 59 cents per diluted share, flat compared with a year before.
Financial markets data firm Refinitiv said on average analysts had expected adjusted earnings of 57 cents per diluted share.
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