BOUCHERVILLE, Que. – Shares of Colabor Group Inc. (TSX:GCL) fell 20 per cent Wednesday after it reported a loss of $3.4 million in its latest quarter, hurt by declining margins and lower sales.
The grocery wholesaler and distributor said the loss amounted to 14 cents per share on $293.6 million in sales in quarter ended March 23.
That compared with a loss of $736,000 or three cents per share on $297.9 million in sales in the comparable period a year ago.
The company’s distribution business earned $204.9 million in sales for the quarter, down from $214.7 million, while its wholesale business reports sales of $88.7 million, up from $83.2 million.
Wholesale sales were helped by the recent purchase of T. Lauzon Ltd., which supplies goods to hotels and restaurants in Quebec.
“The declines in sales, operating margins and profitability are attributable mainly to a highly competitive business environment arising from difficult economic conditions in Eastern Canada, combined with more adverse winter weather compared with last year, as well as two fewer days” in the reporting period, Colabor president and chief executive Claude Gariepy said.
The company said it will focus its efforts on improving its business processes and reducing costs.
“Even more important, we remain on the lookout for any additional measure that will further increase our operating efficiency and improve our profitability and cash flow,” Gariepy said.
Colabor is a wholesaler and distributor of food and other products to grocery and convenience stores as well as cafeterias, restaurants and hotels in Quebec, Ontario and the Atlantic provinces.
Shares in the company closed down $1.35 at $5.40 Wednesday on the Toronto Stock Exchange.