BRAMPTON, ONTARIO July 26, 2023 Loblaw Companies Limited (TSX: L) (“Loblaw” or the “Company”) announced today its unaudited financial results for the second quarter ended June 17, 2023¹.

Loblaw delivered another quarter of strong operational and financial results as it continued to execute on retail excellence. The quarter was characterized by increased sales, a focus on value, and lower gross margins. Net earnings were up 31.3%, unusually elevated by lapping a prior year charge at President’s Choice Bank (“PC Bank”), while adjusted net earnings were up 10.6%. Loblaw’s ability to deliver everyday value and savings to Canadians was reflected in strong sales growth across its Food and Drug businesses. Food Retail sales growth was led by a continued consumer shift to discount stores, as customers continued to find value in Loblaw’s private label brands and personalized PC Optimum^TM offers. Drug front-store and pharmacy sales remained strong, led by continued strength in beauty products. Retail gross margin declined slightly in both Food and Drug as the Company faced double digit supplier cost increases that were not fully passed on to consumers, and higher shrink. Higher sales and cost control initiatives drove adjusted net earnings growth in the quarter.

“Our businesses remain focused on providing Canadians with the selection, freshness, care and value they need today,” said Galen G. Weston, Chairman and President, Loblaw Companies Limited. “We will build on this strength and continue to take meaningful steps to fight back against inflation. Our discount offering, best-in-class control brand products and PC Optimum^TM Program are resonating with customers who are looking for value without sacrificing quality.”

2023 SECOND QUARTER HIGHLIGHTS

• Revenue was $13,738 million, an increase of $891 million, or 6.9%.

• Retail segment sales were $13,471 million, an increase of $848 million, or 6.7%.

  • Food Retail (Loblaw) same-stores sales increased by 6.1%.

  • Drug Retail (Shoppers Drug Mart) same-store sales increased by 5.7%, with front store same-store sales growth of 5.0% and pharmacy same-store sales growth of 6.3%.

• E-commerce sales increased by 13.9%.

• Operating income was $927 million, an increase of $185 million, or 24.9%.

• Adjusted EBITDA² was $1,640 million, an increase of $141 million, or 9.4%.

• Retail segment adjusted gross profit percentage² was 31.1%, a decrease of 30 basis points.

• Net earnings available to common shareholders of the Company were $508 million, an increase of $121 million or 31.3%. Diluted net earnings per common share were $1.58, an increase of $0.42, or 36.2%. The increase included the lapping of a prior year charge of $111 million related to a PC Bank commodity tax matter.

• Adjusted net earnings available to common shareholders of the Company² were $626 million, an increase of $60 million, or 10.6%.

• Adjusted diluted net earnings per common share² were $1.94, an increase of $0.25 or 14.8%.

• Repurchased for cancellation 4.2 million common shares at a cost of $511 million and invested $410 million in capital expenditures, net of proceeds from property disposals. Free cash flow² used in the Retail segment was $600 million.

¹This News Release contains forward-looking information. See “Forward-Looking Statements” section of this News Release and the Company’s 2023 Second Quarter Report to Shareholders for a discussion of material factors that could cause actual results to differ materially from the forecasts and projections herein and of the material factors and assumptions that were used when making these statements. This News Release should be read in conjunction with Loblaw Companies Limited’s filings with securities regulators made from time to time, all of which can be found at sedar.com and at loblaw.ca.

²See “Non-GAAP and Other Financial Measures” section in Appendix 1 of this News Release, which includes the reconciliation of such non-GAAP measures to the most directly comparable GAAP measures.

³To be read in conjunction with the “Forward-Looking Statements” section of this News Release and the Company’s 2023 Second Quarter Report to Shareholders.