(Bloomberg) -- The head of one of Canada’s largest supermarket chains rejected criticisms from a government minister who said grocery sellers aren’t being transparent enough about food inflation and the sector isn’t competitive enough.

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Metro Inc. Chief Executive Officer Eric La Fleche told reporters Tuesday his executives have “cooperated, collaborated” and been open with government officials about food pricing decisions and what the company is doing to hold down costs.

La Fleche was responding to comments from Industry Minister Francois-Philippe Champagne, who said this week the industry hasn’t been “sufficiently transparent” about inflation and what actions they’re taking to help stabilize food prices. Food costs in December were up 5% over the previous year, according to Statistics Canada.

On Monday, Champagne urged Canada’s competition commissioner to conduct another study of the grocery market and said new legislative powers would give the watchdog “the tools to challenge abusive practices of market-dominant firms.” The minister has also said he’s been reaching out to foreign companies to encourage them to expand in Canada in the food sector.

La Fleche argued the landscape is already “extremely competitive,” pointing to the presence of companies like Costco Wholesale Corp. and Walmart Inc. in Canada.

Metro reported earnings of C$1.02 per share on an adjusted basis for the first quarter, which ended Dec. 23. Its pretax margin slipped to 6.1% from 6.7% a year earlier.

The earnings were slightly better than analysts expected, but management gave a subdued outlook for fiscal 2024, projecting profit per share to be flat, at best. Metro is facing “significant headwinds” on costs related to its transition to more modern distribution facilities, but earnings growth should resume in 2025, it said. The shares fell as much as 2.5% in Toronto, its biggest intraday drop in over a month.



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