Metro Taps La Fleche as Next CEO

JON SPRINGER

MONTREAL — Eric La Fleche will take over as president and chief executive officer of Metro Inc. April 1, replacing Pierre Lessard, who is retiring, the retailer here said.

La Fleche has served as Metro's executive vice president and chief operating officer since January 2005 and has worked in various positions at Metro since starting in its real estate department in 1991. Lessard has served as CEO of Metro since 1990, overseeing a period of growth marked by the acquisitions of Steinberg, Loeb and A&P chains.

“These are big shoes to fill and a hard act to follow,” La Fleche said in a conference call.

The announcement came in advance of a report detailing difficult conditions during the fiscal fourth quarter for Metro. Low inflation, price competition and disruptions related to a new technology platform in Ontario and a warehouse consolidation in Quebec contributed to a 27% drop in quarterly earnings, to $58.1 million (U.S.), officials said.

In Ontario, ongoing price competition, combined with a transition of information technology systems at acquired A&P stores, contributed to a decline in sales, La Fleche said.

“The systems conversion took its toll. It's safe to say our stores weren't where they needed to be this summer as competition heated up, and we lost some sales due to that,” he said.

La Fleche said Metro's banners were growing in Quebec, but that some of its distribution customers encountered service issues after the company consolidated the activities of three smaller warehouses into a new facility that opened outside Montreal in June.

Sales of $2.47 billion fell 9% from the same period a year ago. Excluding an extra week in the year-ago period, tobacco sales and lost sales due to the sale of a grocery wholesale account, sales would have increased by 0.7%, Metro said. Same-store sales increased by 0.2% for the quarter.

For the fiscal year, earnings of $281 million increased 9.3% on sales of $10.8 billion, down 2.7% from 2006, which was a 53-week fiscal year.