CALGARY, ALBERTA - Sobeys is reorganizing its distribution centers and services over the next couple of years as part of its growth and expansion.
According to CBC News, the grocery chain is shaking up a few things as it continues to work in its former Canada Safeway stores, having acquired the chain when the banner merged with Albertsons. As a result of these changes, it is planning to cut a number of back-office positions and distribution facility jobs, costing the company about $100 million in the process.
Marc Poulin, CEO of Empire Company (parent company for Sobeys), said on a conference call to analysts regarding the company’s 2015 financial Q4, that some of the losses would be a result of closing a support center west of Toronto. This particular change is to be part of the company moving to a new automated distribution center in October of next year, according to the report. The company will also be closing a Calgary-based support center once the Rocky View, Alta. facility it purchased from Target Canada that will open at some point in mid-2017 as an automated distribution center.
In total the company is expecting to cut about 1,300 jobs over the next couple of years, according to CBC.
Despite the shakeup, Empire reportedly closed the year on a high note, seeing an 11 percent increase in dividend and an 82.3 percent jump in EBITDA, from last year’s $755.3 million to $1,226.1 million.
“We delivered solid results in fiscal 2015 as a result of the continued roll out of our Better Food for All movement, as well as substantial progress on the integration of the Safeway business,” Poulin said in the financial report, adding that the results were in line with internal expectations. “With the technical integration of Canada Safeway now completed, we are now focused on the second phase of achieving our cost synergy targets. We remain confident in our ability to deliver on our three-year commitment, having already recognized $145 million in synergies.”
The parent company also saw a slip in sales of about 2.9 percent, which it attributed to store divestitures and closures as it continues to move things around in an effort to expand.
