Loblaw Plans Store Closings, Conversions

TORONTO - Loblaw Cos. here will close 19 stores under the Provigo banner and 24 cash-and-carry wholesale outlets as part of a “formula for growth” outlined by its new management team in a quarterly conference call yesterday. Loblaw also said it would expand 44 of its grocery stores in Ontario to its Real Canadian Superstore concept. The company said it would take a charge of $35 million to $40 million (U.S.) to cover closing expenses at Provigo, and $11 million to $13 million from the warehouse store closures. The store conversions were made possible by a new labor contract agreed to earlier this year but will result in a charge of $66 million to $70 million. During the fiscal third quarter that ended Oct. 7, Loblaw reported earnings of $178 million on sales of $7.9 billion. Same-store sales increased by 2%. Loblaw said the announced initiatives would contribute to yearly earnings below its previous forecast of flat to 5% below 2005 profits.