Loblaw rides long-term discount trend to stronger Q2 results + MORE Jul 25th

A slew of new discount stores helped push profit at Loblaw Cos. Ltd. higher in the second quarter, as shoppers continue to seek lower-priced products, a trend the company’s CEO says will remain for the long term. 

“Our hard discount stores: They’re doing well and they’re still leading and doing better compared to the rest of the portfolio,” Loblaw chief executive Per Bank told analysts on a conference call Thursday. He said Canadians are increasingly seeking promotions and private-label products, driving up sales at the grocer’s discount stores. “The global shift toward discount retail is a long-term trend and we are leading it here in Canada,” Bank said.

Earlier this year, Loblaw announced its plan to spend $2.2 billion, opening 80 new grocery and pharmacy stores, with about 50 of them being smaller-format discount stores. So far, the company has opened 20 new stores and 23 new pharmacy clinics.

Loblaw reports strong Q2 profit but holds off on raising outlook

The parent company of Loblaws and Shoppers Drug Mart said its net earnings available to common shareholders amounted to $714 million or $2…

Mortgage rates continue to tick higher, and the impact is being felt in housing markets across Canada, according to the latest affordability data from Ratehub.ca. The June edition of the study, which is conducted monthly to record affordability conditions in real time, found conditions eroded in 12 out of 13 major urban centres.

The report uses monthly real estate data from the Canadian Real Estate Association (CREA), average mortgage rates, and the mortgage stress test rate to calculate affordability levels in each market; this is defined as the amount of income a buyer would need to earn to qualify for a mortgage on the average-priced home in the city, as well as the corresponding monthly mortgage payment.

As was the case in May, steeper borrowing costs were to blame for tougher buying conditions. Higher bond yields have prompted lenders to push their fixed mortgage rate offerings higher, while variable mortgage rates have been stagnant. As a result, the average five-year fixed mortgage rate used in the study’s calculation increased to 4…