2025 Second Quarter Results: PDF - 290 Kb

INTERIM REPORT

12-week period ended March 15, 2025

2nd Quarter 2025

HIGHLIGHTS

2025 SECOND QUARTER

• Sales of $4,909.9 million, up 5.5%
• Food same-store sales(1) up 5.3% and up 3.9% when adjusting for the Christmas week shift(3)
• Pharmacy same-store sales(1) up 7.0%
• Net earnings of $220.0 million, up 17.6% and adjusted net earnings(1) of $226.6 million, up 9.8%
• Fully diluted net earnings per share of $0.99, up 19.3% and adjusted fully diluted net earnings per share(1) of $1.02, up 12.1%

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"

1. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

REPORT TO SHAREHOLDERS

Dear Shareholders,

I am pleased to present our interim report for the second quarter of Fiscal 2025 ended March 15, 2025.

Sales in the second quarter of Fiscal 2025 ended on March 15, 2025 were $4,909.9 million, up 5.5% versus the second quarter of the prior year which ended on March 16, 2024. Sales were positively impacted by the transfer of two significant pre-Christmas shopping days to the second quarter this year.

Food same-store sales(1) were up 5.3% in the second quarter of Fiscal 2025 and up 3.9% when adjusting for the Christmas shift(3). Online food sales(1) were up 26.2% versus last year. When adjusting for the sales tax holiday, our food basket inflation was slightly lower than the reported CPI for food purchased from stores. Pharmacy same-store sales(1) were up 7.0% with a 7.8% increase in prescription drugs(1) and a 5.3% increase in front-store sales(1). When adjusting for the Christmas shift(3), the increase in front-store sales was 3.7%.

Second quarter net earnings were $220.0 million in Fiscal 2025 compared with $187.1 million in 2024 and fully diluted net earnings per share were $0.99 compared with $0.83 in 2024, up 17.6% and 19.3% respectively. Adjusted net earnings(1) for the second quarter of Fiscal 2025 totalled $226.6 million compared with $206.4 million for the corresponding quarter of 2024, and adjusted fully diluted net earnings per share(1) for second quarter of Fiscal 2025 were $1.02, versus $0.91 in 2024, up 9.8% and 12.1% respectively. The second quarters of 2025 and 2024 included an adjustment for the after-tax amortization of intangible assets acquired in connection with the Jean Coutu Group acquisition. The second quarter of 2024, also included adjustments for a non-cash $18.1 million impairment of a loyalty program, net of taxes of $2.7 million and a $5.4 million gain on disposal of an investment in an associate, net of taxes of $1.6 million.

On April 15, 2025, the Board of Directors declared a quarterly dividend of $0.37 per share, the same amount declared last quarter.

We delivered solid results in the second quarter, driven by strong sales growth in both food and pharmacy as our teams continue to focus on bringing value to our customers across our different banners. We are actively promoting and highlighting Canadian products in our stores and online, as well as sourcing products from our international supplier base to respond to the needs of our customers. Despite the current uncertain economic environment, we are confident that our sustained investments in our retail networks and supply chain combined with strong execution will continue to fuel our growth(2).

Eric La Flèche

President and Chief Executive Officer

April 16, 2025

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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MANAGEMENT'S DISCUSSION AND ANALYSIS

The following Management's Discussion and Analysis (MD&A) sets out the financial position and consolidated results of METRO INC. (the Corporation) on March 15, 2025 and for the 12 and 24-week periods then ended. It should be read in conjunction with the unaudited interim condensed consolidated financial statements and accompanying notes in this interim report.

The unaudited interim condensed consolidated financial statements for the 12 and 24-week periods ended March 15, 2025 have been prepared by management in accordance with IAS 34 Interim Financial Reporting. They should be read in conjunction with the audited annual consolidated financial statements and accompanying notes and the MD&A presented in the Corporation's 2024 Annual Report. Unless otherwise stated, the interim report is based on information as at April 4, 2025.

Additional information, including the Certification of Interim Filings for the quarter ended March 15, 2025 signed by the President and Chief Executive Officer and the Executive Vice President, Chief Financial Officer and Treasurer, will also be available on the SEDAR website at: www.sedarplus.ca.

OPERATING RESULTS

SALES

Sales in the second quarter of Fiscal 2025 ended on March 15, 2025 were $4,909.9 million, up 5.5% versus the second quarter of the prior year which ended on March 16, 2024. Sales were positively impacted by the transfer of two significant pre-Christmas shopping days to the second quarter this year.

Food same-store sales(1) were up 5.3% in the second quarter of Fiscal 2025 and up 3.9% when adjusting for the Christmas shift(3). Online food sales(1) were up 26.2% versus last year. When adjusting for the sales tax holiday, our food basket inflation was slightly lower than the reported CPI for food purchased from stores. Pharmacy same-store sales(1) were up 7.0% with a 7.8% increase in prescription drugs(1) and a 5.3% increase in front-store sales(1). When adjusting for the Christmas shift(3), the increase in front-store sales was 3.7%.

Sales in the first 24 weeks of Fiscal 2025 totalled $10,027.0 million, up 4.1% compared to $9,629.7 million for the corresponding period of 2024.

OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION AND IMPAIRMENTS OF ASSETS

This earnings measurement excludes financial costs, taxes, depreciation and amortization and impairments of assets.

Operating income before depreciation and amortization and impairments of assets for the second quarter of Fiscal 2025 totalled $461.0 million, or 9.4% of sales, an increase of 5.0% versus the corresponding quarter of Fiscal 2024. The second quarter of 2024 benefited from a gain on sale of assets of $7.2 million. Operating income before depreciation and amortization and impairments of assets for the first 24 weeks of Fiscal 2025 totalled $942.5 million, or 9.4% of sales, up 3.9% versus the corresponding period of 2024.

Gross margin(1) for the second quarter and the first 24 weeks of Fiscal 2025 was 20.0% and 19.9% respectively versus 19.9% and 19.7% for the corresponding periods of 2024.

Operating expenses as a percentage of sales for the second quarter of Fiscal 2025 were 10.6% versus 10.7% in the corresponding quarter of 2024. Operating expenses in the second quarter of 2025 were favorably impacted as we cycled high transition and duplication costs related to our automated distribution center for fresh and frozen products in Terrebonne in the second quarter of 2024. This was partly offset by higher energy costs in Ontario and fees related to the increase in online partnership sales in the second quarter of 2025.

For the first 24 weeks of Fiscal 2025, operating expenses as a percentage of sales were 10.5% versus 10.4% for the corresponding period of 2024. The increase in operating expenses is mainly due to the launch of the Moi Rewards program in Ontario in the first quarter of 2025 and the recording of professional fees regarding the resolution of a tax position related to prior years.

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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DEPRECIATION AND AMORTIZATION

Total depreciation and amortization expense for the second quarter of Fiscal 2025 was $136.1 million versus $129.5 million for the corresponding quarter of 2024. For the first 24 weeks of Fiscal 2025, total depreciation and amortization expense was $269.7 million versus $260.6 million for the corresponding period of 2024. The increase in depreciation and amortization expense is mainly due to the timing of retail investments and the commissioning of investments in our supply chain, including some automation technology in the Pharmacy division and the final phase of our fresh distribution centre in Toronto last summer.

IMPAIRMENTS OF ASSETS

During the second quarter of Fiscal 2024, the Corporation recorded $20.8 million of impairments of assets resulting from the decision to have Metro stores in Ontario withdraw from the Air Miles® loyalty program in the summer of 2024. This impairment represents the entire carrying value of the loyalty program asset.

NET FINANCIAL COSTS

Net financial costs for the second quarter of Fiscal 2025 were $33.4 million compared with $34.1 million for the corresponding quarter of 2024. For the first 24 weeks of Fiscal 2025, net financial costs were $64.1 million compared with $66.5 million for the corresponding period of 2024. The decrease in financial costs is mainly due to lower interest expense on net debt partly offset by lower capitalized interest.

INCOME TAXES

The income tax expense of $71.5 million for the second quarter of Fiscal 2025 represented an effective tax rate of 24.5% compared with an income tax expense of $67.6 million and an effective tax rate of 26.5% for the second quarter of Fiscal 2024. The decrease in the effective tax rate in 2025 is mainly attributable to a provincial tax holiday of $6.0 million related to the commissioning of our new automated distribution center for fresh and frozen products in Terrebonne.

The 24-week period income tax expense of $129.2 million for Fiscal 2025 and $143.7 million for Fiscal 2024 represented effective tax rates of 21.2% and 25.7% respectively. The decrease in the effective tax rate in 2025 is mainly attributable to a provincial tax holiday of $12.1 million related to the commissioning of our new automated distribution center for fresh and frozen products in Terrebonne. The total tax holiday represents approximately $66 million and we estimate it will be recognized over a period of 3 years(2). The first quarter of 2025 also included a favorable $20.6 million income tax adjustment in respect of prior years.

NET EARNINGS AND ADJUSTED NET EARNINGS(1)

Net earnings for the second quarter of Fiscal 2025 were $220.0 million compared with $187.1 million for the corresponding quarter of 2024, while fully diluted net earnings per share were $0.99 compared with $0.83 in 2024, up 17.6% and 19.3% respectively. Excluding the specific items shown in the table below, adjusted net earnings(1) for the second quarter of Fiscal 2025 totalled $226.6 million compared with $206.4 million for the corresponding quarter of 2024, and adjusted fully diluted net earnings per share(1) for second quarter of Fiscal 2025 were $1.02, versus $0.91 in 2024, up 9.8% and 12.1% respectively.

Net earnings for the first 24 weeks of Fiscal 2025 were $479.5 million compared with $415.6 million for the corresponding period of 2024, while fully diluted net earnings per share were $2.15 compared with $1.82 in 2024, up 15.4% and 18.1% respectively. Excluding the specific items shown in the table below, adjusted net earnings(1) for the first 24 weeks of Fiscal 2025 totalled $472.0 million compared with $441.4 million for the corresponding period of 2024, and adjusted fully diluted net earnings per share(1) amounted to $2.12 versus $1.93, up 6.9% and 9.8% respectively.

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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Net earnings and fully diluted net earnings per share (EPS) adjustments(1)

		12 weeks / Fiscal Year
	2025	2024		Change (%)
	Net earnings	Fully diluted		Net earnings	Fully diluted		Net	Fully
	(Millions of	EPS		(Millions of	EPS		diluted
	dollars)	(Dollars)		dollars)	(Dollars)		earnings	EPS
Per financial statements	220.0	0.99	187.1	0.83	17.6	19.3
Loss on impairment of a loyalty program, net	-		18.1
of taxes of $2.7
Gain on disposal of an investment in an	-		(5.4)
associate, net of taxes of $1.6
Amortization of intangible assets acquired in
connection with the Jean Coutu Group	6.6		6.6
acquisition, net of taxes of $2.3
Adjusted measures(1)	226.6	1.02	206.4	0.91	9.8	12.1
		24 weeks / Fiscal Year
	2025	2024		Change (%)
	Net earnings	Fully diluted		Net earnings	Fully diluted		Net	Fully
	(Millions of	EPS		(Millions of	EPS		diluted
	dollars)	(Dollars)		dollars)	(Dollars)		earnings	EPS
Per financial statements	479.5	2.15	415.6	1.82	15.4	18.1
Loss on impairment of a loyalty program, net	-		18.1
of taxes of $2.7
Gain on disposal of an investment in an	-		(5.4)
associate, net of taxes of $1.6
Amortization of intangible assets acquired in
connection with the Jean Coutu Group	13.1		13.1
acquisition, net of taxes of $4.7
Favorable resolution of a tax position in	(20.6)			-
respect of prior years
Adjusted measures(1)	472.0	2.12	441.4	1.93	6.9	9.8

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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QUARTERLY HIGHLIGHTS

(Millions of dollars, unless otherwise indicated)	2025	2024	2023	Change (%)
Sales
Q2(4)	4,909.9	4,655.5	-	5.5
Q1(4)	5,117.1	4,974.2	-	2.9
Q4(5)	-	4,938.4	5,071.7	(2.6)
Q3(6)	-	6,651.8	6,427.5	3.5
Net earnings
Q2(4)	220.0	187.1	-	17.6
Q1(4)	259.5	228.5	-	13.6
Q4(5)	-	219.9	222.2	(1.0)
Q3(6)	-	296.2	346.7	(14.6)
Adjusted net earnings(1)
Q2(4)	226.6	206.4	-	9.8
Q1(4)	245.4	235.0	-	4.4
Q4(5)	-	226.5	228.8	(1.0)
Q3(6)	-	305.0	314.8	(3.1)
Fully diluted net earnings per share (Dollars)
Q2(4)	0.99	0.83	-	19.3
Q1(4)	1.16	0.99	-	17.2
Q4(5)	-	0.98	0.96	2.1
Q3(6)	-	1.31	1.49	(12.1)
Adjusted fully diluted net earnings per share(1) (Dollars)
Q2(4)	1.02	0.91	-	12.1
Q1(4)	1.10	1.02	-	7.8
Q4(5)	-	1.02	0.99	3.0
Q3(6)	-	1.35	1.35	-

1. 12 weeks
2. 12 weeks in 2025 and 2024, 13 weeks in 2023
3. 16 weeks

Sales in the second quarter of Fiscal 2025 ended on March 15, 2025 were $4,909.9 million, up 5.5% versus the second quarter of the prior year which ended on March 16, 2024. Sales were positively impacted by the transfer of two significant pre-Christmas shopping days to the second quarter this year. Food same-store sales(1) were up 5.3% in the second quarter of Fiscal 2025 and up 3.9% when adjusting for the Christmas shift(3). Online food sales(1) were up 26.2% versus last year. When adjusting for the sales tax holiday, our food basket inflation was slightly lower than the reported CPI for food purchased from stores. Pharmacy same-store sales(1) were up 7.0% with a 7.8% increase in prescription drugs(1) and a 5.3% increase in front-store sales(1). When adjusting for the Christmas shift(3), the increase in front-store sales was 3.7%.

Sales in the first quarter of Fiscal 2025 ended on December 21, 2024 were $5,117.1 million, up 2.9% versus the first quarter of the prior year which ended on December 23, 2023. Sales were negatively impacted by the transfer of two significant pre-Christmas shopping days to the second quarter this year. Food same-store sales(1) were up 1.0% in the first quarter of Fiscal 2025 and up 2.4% when adjusting for the Christmas shift(3). Online food sales(1) were up 18.6% versus last year. When adjusting for the sales tax holiday, our food basket inflation was slightly higher than the reported CPI for food purchased from stores. Pharmacy same-store sales(1) were up 5.1% with a 7.3% increase in prescription drugs(1) and a 0.5% increase in front-store sales(1). When adjusting for the Christmas shift(3), the increase in front-store sales was 1.9%.

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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Sales in the fourth quarter of Fiscal 2024 ended on September 28, 2024 were $4,938.4 million, down 2.6% versus the fourth quarter of the prior year, and up 5.7% based on 12 weeks in 2023, driven by higher sales in our retail network this year and the negative impact of a labour conflict at 27 Metro stores in the Greater Toronto Area in the fourth quarter of 2023. Our food basket inflation was slightly higher than the reported CPI for food purchased from stores of 1.7%. Food Same-store sales(1) were up 2.2% in the fourth quarter of Fiscal 2024 (6.8% in the fourth quarter of 2023). Online food sales(1) were up 27.6% versus the comparable 12-week period last year (116.0% in the fourth quarter of 2023). Pharmacy same-store sales(1) were up 5.7% (5.5% in the fourth quarter of 2023), with a 6.8% increase in prescription drugs(1) and a 3.3% increase in front-store sales(1), primarily driven by over-the-counter products, cosmetics and health and beauty.

Sales in the third quarter of Fiscal 2024 ended on July 6, 2024 were $6,651.8 million, up 3.5% versus the third quarter of the prior year which ended on July 1, 2023, driven by higher sales in our retail network. Our food basket inflation was slightly lower than the reported CPI for food purchased from stores of 1.1%. Food same-store sales(1) were up 2.4% in the third quarter of Fiscal 2024 (9.4% in the third quarter of 2023). Pharmacy same-store sales(1) were up 5.2% (5.9% in the third quarter of 2023), with a 6.3% increase in prescription drugs(1) and a 3.0% increase in front- store sales(1), primarily driven by over-the-counter products, cosmetics and health and beauty.

Net earnings for the second quarter of Fiscal 2025 were $220.0 million compared with $187.1 million for the corresponding quarter of 2024, while fully diluted net earnings per share were $0.99 compared with $0.83 in 2024, up 17.6% and 19.3% respectively. Adjusted net earnings(1) for the second quarter of Fiscal 2025 totalled $226.6 million compared with $206.4 million for the corresponding quarter of 2024, and adjusted fully diluted net earnings per share(1) for second quarter of Fiscal 2025 were $1.02, versus $0.91 in 2024, up 9.8% and 12.1% respectively. The second quarters of 2025 and 2024 included an adjustment for the pre-tax amortization of intangible assets acquired in connection with the Jean Coutu Group acquisition of $8.9 million, as well as the income taxes relating to this item. The second quarter of 2024 also included a loss on the impairment of a loyalty program of $20.8 million and a gain on disposal of an investment in an associate of $7.0 million, as well as the income taxes relating to these items.

Net earnings for the first quarter of Fiscal 2025 were $259.5 million compared with $228.5 million for the corresponding quarter of 2024, while fully diluted net earnings per share were $1.16 compared with $0.99 in 2024, up 13.6% and 17.2% respectively. Adjusted net earnings(1) for the first quarter of Fiscal 2025 totalled $245.4 million compared with $235.0 million for the corresponding quarter of 2024, up 4.4%. Adjusted fully diluted net earnings per share(1) for the first quarter of Fiscal 2025 were $1.10, versus $1.02 in 2024, up 7.8%. The first quarters of 2025 and 2024 included an adjustment for the pre-tax amortization of intangible assets acquired in connection with the Jean Coutu Group acquisition of $8.9 million, as well as the income taxes relating to this item and the first quarter of 2025 also included a $20.6 million adjustment regarding the favorable resolution of an income tax position related to prior years.

Net earnings for the fourth quarter of Fiscal 2024 were $219.9 million compared with $222.2 million for the corresponding quarter of 2023, while fully diluted net earnings per share were $0.98 compared with $0.96 in 2023, down 1.0% and up 2.1% respectively. Adjusted net earnings(1) for the fourth quarter of Fiscal 2024 totalled $226.5 million compared with $228.8 million for the corresponding quarter of 2023, down 1.0%. Adjusted fully diluted net earnings per share(1) for the fourth quarter of Fiscal 2024 were $1.02, versus $0.99 in 2023, up 3.0%. In the fourth quarter of 2023, the labour conflict at 27 Metro stores in the Greater Toronto Area had an unfavorable impact of approximately $27.0 million after-tax or $0.12 per share and the 13th week had a favorable impact of $27.0 million net of tax or $0.12 per share. The fourth quarters of 2024 and 2023 included an adjustment for the pre-tax amortization of intangible assets acquired in connection with the Jean Coutu Group acquisition of $9.0 million, as well as the income taxes relating to this item.

Net earnings for the third quarter of Fiscal 2024 were $296.2 million compared with $346.7 million for the corresponding quarter of 2023, while fully diluted net earnings per share were $1.31 compared with $1.49 in 2023, down 14.6% and 12.1% respectively. Adjusted net earnings(1) for the third quarter of Fiscal 2024 totalled $305.0 million compared with $314.8 million for the corresponding quarter of 2023, down 3.1% and adjusted fully diluted net earnings per share(1) were $1.35, the same amount as the corresponding quarter of 2023. The third quarters of 2024 and 2023 included an adjustment for the pre-tax amortization of intangible assets acquired in connection with the Jean Coutu Group acquisition of $11.9 million, as well as the income taxes relating to this item and the third quarter of 2023 also included an adjustment for a favorable $40.7 million income tax entry in respect of prior years.

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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		2025					2024			2023
(Millions of dollars)	Q2	Q1			Q4	Q3	Q2	Q1			Q4	Q3
Net earnings	220.0	259.5		219.9	296.2	187.1	228.5		222.2	346.7
Loss on impairment of a loyalty program, net of	-	-			-	-	18.1	-			-	-
taxes
Gain on disposal of an investment in an	-	-			-	-	(5.4)	-			-	-
associate, net of taxes
Amortization of intangible assets acquired in
connection with the Jean Coutu Group	6.6	6.5		6.6	8.8	6.6	6.5		6.6	8.8
acquisition, net of taxes
Favorable resolution of a tax position in respect	-	(20.6)			-	-	-	-			-	(40.7)
of prior years
Adjusted net earnings(1)	226.6	245.4		226.5	305.0	206.4	235.0		228.8	314.8
		2025					2024				2023
(Dollars)	Q2	Q1				Q4	Q3	Q2	Q1				Q4	Q3
Fully diluted net earnings per share	0.99	1.16		0.98	1.31	0.83	0.99		0.96	1.49
Adjustments impact	0.03	(0.06)		0.04	0.04	0.08	0.03		0.03	(0.14)
Adjusted fully diluted net earnings per share(1)	1.02	1.10		1.02	1.35	0.91	1.02		0.99	1.35

CASH POSITION

OPERATING ACTIVITIES

In the second quarter of Fiscal 2025, operating activities generated cash inflows of $383.2 million compared with $457.4 million in the corresponding quarter of 2024. The decrease is mainly due to changes in non-cash working capital items during the quarter compared to last year.

In the first 24 weeks of Fiscal 2025, operating activities generated cash inflows of $548.7 million compared with $629.7 million for the corresponding period of 2024. The decrease is mainly due to changes in non-cash working capital items during the first 24 weeks of Fiscal 2025 compared to last year and to higher taxes paid in 2025.

INVESTING ACTIVITIES

Investing activities required cash outflows of $57.5 million for the second quarter of Fiscal 2025 compared with $69.6 million for the corresponding quarter of 2024. This difference stemmed mainly from lower investments in tangible and intangible assets of $21.7 million in 2025.

In the first 24 weeks of Fiscal 2025, investing activities required cash outflows of $114.3 million compared with $156.8 million for the corresponding period of 2024. This difference stemmed mainly from lower investments in tangible and intangible assets of $49.7 million in 2025.

During the first 24 weeks of Fiscal 2025, we and our retailers opened 2 stores, carried out major expansions and renovations of 8 stores and 3 stores were closed for a net increase of 18,100 square feet or 0.1% of our food retail network.

FINANCING ACTIVITIES

In the second quarter of 2025, financing activities required cash outflows of $287.1 million compared with $388.3 million in the corresponding quarter of 2024. The variation is mainly due to a favorable variation in net debt of $184.3 million in 2025 compared to 2024, partly offset by higher share repurchases of $76.0 million in 2025.

In the first 24 weeks of Fiscal 2025, financing activities required cash outflows of $425.2 million compared with $502.4 million for the corresponding period of 2024. This difference is mainly due to a favorable variation in net debt of $151.8 million in 2025 compared to 2024, partly offset by higher share repurchases of $64.5 million in 2025.

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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FINANCIAL POSITION

We do not anticipate(2) any liquidity risk and consider our financial position at the end of the second quarter of 2025 as very solid. We had an unused authorized revolving credit facility of $516.3 million.

At the end of the second quarter of 2025, the main elements of our debt were as follows:

	Interest Rate	Maturity	Notional
	(Millions of dollars)
	Rates fluctuate with changes in bankers'
Revolving Credit Facility	acceptance rates	December 11, 2029	83.7
Series G Notes	3.39% fixed nominal rate	December 6, 2027	450.0
Series L Notes	4.00% fixed nominal rate	November 27, 2029	500.0
Series K Notes	4.66% fixed nominal rate	February 7, 2033	300.0
Series B Notes	5.97% fixed nominal rate	October 15, 2035	400.0
Series D Notes	5.03% fixed nominal rate	December 1, 2044	300.0
Series H Notes	4.27% fixed nominal rate	December 4, 2047	450.0
Series I Notes	3.41% fixed nominal rate	February 28, 2050	400.0

On November 27, 2024, the Corporation issued through a private placement Series L unsecured senior notes in the aggregate principal amount of $500.0 million, bearing interest at a fixed nominal rate of 3.998%, maturing on November 27, 2029. In anticipation of this issuance, on November 22, 2024, the Corporation entered into a bond forward contract designated as cash flow hedge on a portion of a highly probable future debt issuance in the amount of $100.0 million that effectively locked-in a 5-year fixed underlying Government of Canada yield of 3.351%. The effective part of the loss on the hedging instrument was recognized in Other Comprehensive Income. Following the Series L notes issuance, the amounts accumulated in equity will be reclassified to net financial costs on a linear basis over the life of the debt.

On December 2, 2024, the Corporation redeemed all of the Series J notes, bearing interest at a fixed nominal rate of 1.92%, in the amount of $300.0 million that matured on the same day.

CAPITAL STOCK, STOCK OPTIONS AND PERFORMANCE SHARE UNITS

	As at	As at
	March 15, 2025	September 28, 2024
Number of Common Shares outstanding (Thousands)	219,491	222,414
Stock options:
Number outstanding (Thousands)	2,193	2,179
Exercise prices (Dollars)	47.51 to 93.15	41.16 to 77.75
Weighted average exercise price (Dollars)	67.44	61.15
Performance share units:
Number outstanding (Thousands)	558	571

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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NORMAL COURSE ISSUER BID PROGRAM

Under the current normal course issuer bid program, the Corporation may repurchase up to 10,000,000 of its Common Shares between November 27, 2024 and November 26, 2025. Between November 27, 2024 and April 4, 2025, the Corporation has repurchased 2,849,000 Common Shares at an average price of $92.65, for a total consideration of $264.0 million.

DIVIDENDS

On April 15, 2025, the Board of Directors declared a quarterly dividend of $0.37 per share, the same amount declared last quarter.

SHARE TRADING

The value of METRO shares remained in the $81.01 to $97.25 range over the first 24 weeks of Fiscal 2025. During this period, a total of 59.2 million shares were traded on the Toronto Stock Exchange. The closing price on April 4, 2025 was $100.42 compared with $84.84 at the end of Fiscal 2024.

NEW ACCOUNTING STANDARD

ACCOUNTING STANDARD ISSUED BUT NOT YET EFFECTIVE

Presentation and Disclosures in Financial Statements

In April 2024, the IASB issued IFRS 18, which replaces IAS 1 Presentation of Financial Statements, and consequential amendments to several other standards. IFRS 18 introduces new requirements for presentation within the statement of profit or loss, including specified totals and subtotals. Entities are required to classify all income and expenses within the statement of profit or loss into one of five categories: operating, investing, financing, income taxes and discontinued operations, with prescribed subtotals for each new category. It also requires disclosure of management-defined performance measures which will now form part of the audited financial statements.

IFRS 18, and the amendments to the other standards, is effective for reporting periods beginning on or after January 1 2027, but earlier application is permitted and must be disclosed. IFRS 18 will apply retrospectively. The Corporation is currently working to identify all impacts the amendments will have on the consolidated financial statements and notes to the consolidated financial statements.

FORWARD-LOOKING INFORMATION

We have used, throughout this report, different statements that could, within the context of regulations issued by the Canadian Securities Administrators, be construed as being forward-looking information. In general, any statement contained herein that does not constitute a historical fact may be deemed a forward-looking statement. Expressions such as "anticipate", "continue", "estimate", "predict" and other similar expressions are generally indicative of forward- looking statements. The forward-looking statements contained herein are based upon certain assumptions regarding the Canadian food and pharmaceutical industries, the general economy, our annual budget, as well as our 2025 action plan.

These forward-looking statements do not provide any guarantees as to the future performance of the Corporation and are subject to potential risks, known and unknown, as well as uncertainties that could cause the outcome to differ significantly. Risk factors that could cause actual results or events to differ materially from our expectations as expressed in, or implied by, our forward-looking statements are described and discussed under the "Risk Management" section in our Annual Report 2024.

We believe these statements to be reasonable and pertinent as at the date of publication of this report and represent our expectations. The Corporation does not intend to update any forward-looking statement contained herein, except as required by applicable law.

1. This measurement is presented for information purpose only. It does not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measurements presented by other public companies. See table in section "Operating Results" and section on "Non-GAAP and Other Financial Measurements"
2. See section on "Forward-looking Information"
3. This measure compares same-store-sales(1) for the 12-week period ending March 15, 2025 with that ending March 16, 2024.

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