Grocery giant Loblaw Cos., which bills itself as Canada’s largest retailer, has named a new president and chief executive as controlling shareholder Galen Weston will be moving away from day-to-day operations.
European retail executive Per Bank plans to formally join the company better known as Loblaws in the first quarter of 2024. Bank is currently CEO of Salling Group A/S, which is the largest retailer in Denmark with 1,700 supermarkets, and has 30 years of retail experience, according to a statement from Loblaw Cos.
Loblaw Cos., which has 2,400 locations across Canada that sell groceries as well as a smattering of other items such as clothing and electronics, announced plans last week to invest more than $2 billion this year to expand its network. Plans include opening 38 new stores and converting or renovating nearly 600 locations, according to a separate statement.
The capital investment will also go toward modernizing its supply chain and the development of a new distribution centre in the Greater Toronto Area.
The hiring of Bank follows a global talent search that started in August in anticipation of Robert Sawyer’s planned retirement as chief operating officer of Loblaw Cos. at the end of 2023.
Weston will continue as chair of the board of Loblaw Cos., as well as chair of parent company George Weston Ltd., where he will remain CEO. Weston previously served as president of Loblaw Cos.
“I’m not leaving. I’m stepping back into what I consider to be my natural role as controlling shareholder,” said Weston on a Tuesday conference call with analysts.
Criticism
The publicly traded company faced criticism after it beat analysts’ expectations in recent earnings reports while also ending a four-month price freeze on its 'No Name' branded products aimed at price-conscious consumers, leading some to allege that the chain has been profiting too much.
Canadian federal New Democratic Party leader Jagmeet Singh took aim at the company as far back as last August when he tweeted, "Corporate greed is Loblaw's gross profit jumping 21% while the wages of its workers are unable to keep up with rising inflation."
The 50-year-old Weston, who has become the face of company after starring in many TV commercials in recent years, was one of several grocery chain executives called in to speak to a House of Commons committee in March amid allegations of price gouging consumers.
George Weston Ltd. also controls Choice Properties Real Estate Investment Trust, which has fared less well in recent times, declaring a loss of $579 million for the final quarter of 2022.
Canadian inflation continues to taper down, with the latest information from Statistics Canada showing the consumer price index rose 4.3% in March from a year ago, down from February's 5.2% year-over-year increase.
Grocery prices continued to rise, albeit slower, with March showing a 9.7% year-over-year increase in the category. Grocery prices were up 10.6% year over year in February.
StatsCan said the slowdown stemmed from lower prices for fresh fruit and vegetables. Prices for fresh fruit increased 7.1% year over year in March, after a 10.5% gain in February.
"Food price growth remains aloft, even as the price-setting behaviour of Canada's grocery chains is under the microscope," the Conference Board of Canada noted in an analysis.
Andrew Granthan, an economist with CIBC, noted while food price inflation slowed, prices continued to rise on a month-to-month basis.
Doug Porter, chief economist of the Bank of Montreal, said food price increases cooled "although grocery prices are hardly calm" but sees overall inflation heading to 3% in the coming months.