Empire Reports Fiscal 2025 Second Quarter Results

• Earnings per share (“EPS”) and adjusted EPS⁽¹⁾ of $0.73
• Prior year EPS and adjusted EPS of $0.72 and $0.71, respectively
• Same-store sales, excluding fuel, increased by 1.8%

Empire Company Limited (“Empire” or the “Company”) (TSX: EMP.A) today announced its financial results for the second quarter ended November 2, 2024. For the quarter, the Company recorded net earnings of $173.4 million ($0.73 per share) compared to $181.1 million ($0.72 per share) last year. For the quarter, the Company recorded adjusted net earnings of $173.4 million ($0.73 per share) compared to $178.3 million ($0.71 per share) last year.

“We delivered another solid quarter, driven by focused execution in all areas of our business and a gradually improving economic and consumer environment,” said Michael Medline, President & CEO, Empire.

Company Priorities

The Company is continuing to enhance data capabilities and deepen the understanding of customers, allowing the Company to effectively capture emerging trends. The Company aims to grow total adjusted EPS over the long-term through net earnings growth and share repurchases. The Company intends to continue improving sales, gross margin (excluding fuel) and adjusted EBITDA margin by focusing on priorities such as:

Continued Focus on Stores:

Over recent years, the Company has accelerated investments in renovations, conversions, and new stores along with store processes, communications, training, technology and tools. Investing in the store network will remain a priority, demonstrated by a sustained emphasis on renovations and continued new store expansion. The Own Brands program enhancement will remain a priority through increased distribution, shelf placement and product innovation.

The Company intends to invest capital in its store network and is on track with its plan to renovate approximately 20% to 25% of the network between fiscal 2024 and fiscal 2026. This capital investment includes important sustainability initiatives such as refrigeration system upgrades and other energy efficiency initiatives.

Enhanced Focus on Digital and Data:

The focus on digital and data will include continued e-commerce expansion, personalization and loyalty through Scene+ (see “Business Updates – E-Commerce” and “Business Updates – Scene+” for more information), improved space productivity and the continued improvement of promotional optimization. Space productivity will further enhance the customer experience by improving store layouts, optimizing category and product adjacencies and tailoring product assortment for each store. The advanced analytics tools built for promotional optimization will continue to be refined through the partnership between the advanced analytics team and category merchants. Enhancing digital and data capabilities will allow the Company to deliver the best personalized experiences to elevate its in-store and e-commerce experience for its customers.

Efficiency and Cost Control:

The Company has significantly improved its efficiency and cost effectiveness through sourcing efficiencies, optimizing supply chain productivity and improving systems and processes. The Company will continue to focus on driving efficiency and cost effectiveness through initiatives related to sourcing of goods not for resale, supply chain productivity and the organizational structure. The Company has implemented several cost savings initiatives in the Voilà business, including pausing the opening of its fourth Customer Fulfilment Centre (“CFC”) and ending its mutual exclusivity with Ocado Group plc (“Ocado”) and continues to pursue other cost saving initiatives.