THIRD QUARTER RESULTS - GROWTH CONTINUES



    MONTREAL, Feb. 21 /CNW Telbec/ - The SAQ closed the third quarter of its
2007-2008 fiscal year with net earnings of $298.3 million, up $7.1 million or
2.4% from the preceding fiscal year.
    During the 16-week period ended January 5, 2008, net sales totalled
$886.8 million, a rise of $33.3 million or 3.9% compared with the preceding
fiscal year. Once again, the growth is attributable to the performance of the
outlet and specialized centre network, which posted net sales of
$737.6 million, as opposed to $702.2 million in fiscal 2006-2007, a 5%
increase.
    After 40 weeks of operation, consolidated net sales for the SAQ's entire
sales and distribution network exceeded $2 billion, compared with
$1.875 billion in 2006-2007, a 7.2% increase. For their part, consolidated net
earnings increased by $44,2 million or 7.5% to $633,9 million.The outlet and
specialized centre network saw its net sales rise nearly $114 million, or
7.5%, to $1.624 billion.
    This sales success can be explained by several factors, including an
improved quality-price ratio for several imported products (in large part due
to favourable exchange rate fluctuations), well-targeted promotional campaigns
supported by attractive discount offers and the provision of high-quality
service.
    The average in-store purchase by consumers during the busiest quarter of
the year was $44.10, versus $42.90 in 2006-2007. The average net sales price
per litre was $16.73, compared with $16.44 in the same quarter last year.
These data clearly point to consumers' habit of increasing the value of their
purchases at this time of the year as well as to a clear trend among Quebecers
toward choosing more upmarket products.
    For their part, net sales in the wholesale grocer network decreased
$5.6 million or 5.5%, to $95.4 million.
    With respect to volume sales(1), the spirits category, whose products are
sold only through the outlet and specialized centre network, stood out in the
third quarter, recording a 4.3% increase to 7.3 million litres. Volume sales
of wine rose 2.9%, from 45.4 million litres to 46.7 million litres. Lastly,
sales of ready-to-drinks-also known as coolers, flavoured alcoholic beverages
and alcopops-remained stable, at 1.7 million litres, as did the beer, cider
and complementary products category at 1 million litres.
    Since the start of its 2007-2008 fiscal year, the SAQ has introduced some
60 new regular products and nearly 800 specialty products, including a large
number of products under the $10 price point. The company has also created a
new South African section in 310 outlets concurrently with its introduction of
around 80 products from that country, which offer a remarkable quality-price
ratio.

    Third-quarter milestones
    ------------------------

    During the quarter, the SAQ inaugurated a new Express 22h outlet in
downtown Montreal and two new Sélection outlets in Boisbriand and Brossard.
The new SAQ Sélection concept also won awards at the ISP/VM+SD International
Store Design Competition and in the Retail Store of the Year 2007 contest of
Chain Store Age, a U.S.-based magazine.
    In response to the soaring Canadian dollar and to ensure that consumers
benefited from it, the SAQ announced in-store retail price adjustments on all
continuous replenishment products it pays for in foreign currencies. The price
cuts took effect on November 28, 2007.
    Lastly, the SAQ gave away nearly 110,000 reusable bags to customers who
made a purchase in one of its outlets on December 2, 2007. The idea was to
thank consumers who take part in municipal selective collection programs and
help ensure that 74% of the bottles they purchase at the SAQ are recovered.
The SAQ is proud to recognize this enviable result, which is made possible by
the daily actions of Quebec's citizens.

    1. Excluding sales to brewers and beer distributors, which do not
    generate gross earnings.
    -%SU: TAX
    -%RE: 1




For further information:

For further information: Linda Bouchard, Media Relations Officer, (514)
254-6000, ext. 5385, li.bouchard@saq.qc.ca

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Société des alcools du Québec - SAQ

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