Sat. Jul 13th, 2024

Boycott Targets Loblaw as Company Posts $13.58 Billion in Profits

A grassroots boycott against Loblaw has launched on the same day the Brampton-based grocery giant reported a staggering $13.58 billion in profits for the first quarter of the year. The movement, driven by over 63,000 members of the Reddit group r/loblawsisoutofcontrol, aims to challenge the company’s pricing practices amid soaring profits.

The boycott, which began Wednesday and is slated to continue throughout May, coincides with a notable increase in Loblaw’s quarterly dividend to 51.3 cents per share, up from 44.6 cents. This rise in dividends comes as Loblaw reported a profit increase from last year’s $13 billion in the same quarter, highlighting a robust growth trajectory despite ongoing consumer discontent over high food prices.

In 2023, Loblaw saw a 9.4 percent rise in profit, totaling $2.08 billion, with revenues climbing 5.4 percent to $59.52 billion. These figures are released in a context where, in September, Prime Minister Justin Trudeau urged grocery executives, including those from Loblaw and Walmart, to develop a plan to stabilize food prices. However, Loblaw and Walmart have resisted signing the proposed “grocery code of conduct,” citing concerns over potential price increases for consumers.

The federal government has not dismissed the possibility of legislating the grocery code if voluntary adoption fails. Loblaw CEO Per Bank expressed a cautiously optimistic outlook about reaching an agreement on the code during his recent statements.

The effectiveness of the boycott in impacting Loblaw’s bottom line remains to be seen. Meanwhile, a 2023 survey ranking Canada’s most trusted brands placed Loblaw at 304th out of over 400, signaling challenges in maintaining consumer trust amid high profitability.

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