- Dividend increase of 16.7%
- Consolidated retail sales up 8.0%; consolidated revenue up
4.6%
- Consolidated net income up 3.5% excluding the effect of tax and
acquisition benefits in prior year.
TORONTO, Nov. 8, 2012 /CNW/ - Canadian Tire Corporation,
Limited (TSX:CTC) (TSX:CTC.a) today released third quarter results
for the period ended September 29,
2012, and announced a 16.7% increase in the quarterly
dividend.
Consolidated sales were up 8.0% and consolidated
revenue increased 4.6% to approximately $2.8
billion in the quarter as a result of the inclusion of FGL
Sports revenue for 13 weeks compared to six weeks in Q3 2011 and
revenue growth at Mark's, Petroleum and Financial Services.
Consolidated net income declined 3.7% compared to the prior
year. Included in net income in the third quarter of 2011
were net benefits related to the acquisition of FGL Sports, reduced
income tax expense and interest income received related to
resolution of tax matters. Excluding these items, net income
increased 3.5% in Q3 2012.
"Overall, the business performed well in the quarter. The
quality of our earnings reflects the strength of our core
categories and efforts to manage the sales and margin mix," said
Stephen Wetmore, President and CEO,
Canadian Tire Corporation. "While revenue declined due to slower
shipments of winter products to our dealer network, I am pleased
with the performance of Canadian Tire Retail and our progress on
key initiatives. We also continued to realize expected synergies at
FGL Sports and advanced our growth strategy and banner
rationalization efforts."
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated financial results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(C$ in millions
except per share amounts) |
|
Q3 2012 |
|
Q3 2011 |
|
Change |
|
YTD Q3
2012 |
|
YTD Q3 2011 |
|
Change |
Retail sales |
|
$ |
3,171.9 |
|
$ |
2,938.1 |
|
8.0% |
|
$ |
9,072.0 |
|
$ |
7,941.2 |
|
14.2% |
Revenue |
|
|
2,829.8 |
|
|
2,704.9 |
|
4.6% |
|
|
8,260.5 |
|
|
7,252.0 |
|
13.9% |
Net income |
|
|
131.4 |
|
|
136.5 |
|
(3.7)% |
|
|
336.1 |
|
|
300.7 |
|
11.8% |
Basic earnings per share |
|
|
1.61 |
|
|
1.68 |
|
(3.7)% |
|
|
4.13 |
|
|
3.69 |
|
11.8% |
Diluted earnings per share |
|
|
1.61 |
|
|
1.67 |
|
(3.8)% |
|
|
4.11 |
|
|
3.68 |
|
11.8% |
Retail
Retail sales at Canadian Tire Retail (CTR)
increased 0.3% and same store sales declined by 0.2% in the
quarter. Canadian Tire saw strong growth in key categories such as
backyard living, outdoor recreation and kitchen as a result of
increased marketing efforts and new assortments. The increase was
partially offset by decreases in categories that were de-emphasized
such as electronics, home décor and household cleaning. Continued
softness in the automotive market contributed to a decline in auto
service and related parts sales in the quarter.
FGL Sports' retail sales increased 4.2% and same
store sales increased 4.4% over the comparable period in the prior
year due to strong sales in apparel, equipment and footwear. As
well, the business has moved quickly to reduce the number of
non-strategic banners as announced in its recent growth
strategy.
At Mark's, retail sales grew 2.0% and same store
sales increased 1.7% due to growth in women's wear and industrial
footwear sales, particularly in Western
Canada. Sales gains were modest in the quarter due to
less promotional activity in July and August, and slower sales of
fall seasonal items in September due to the extended warm weather
across the country.
Petroleum retail sales increased 2.4% primarily
due to strong convenience store sales and increased gas volume.
Revenue in the retail segment increased 4.9% in
the quarter primarily due to the inclusion of FGL Sports for 13
weeks compared to six weeks in Q3 2011, increases in Petroleum and
Mark's, partly offset by a decrease in CTR revenue across all
categories.
Retail segment income before income taxes of $105.6 million was flat compared to the prior
year. The third quarter of 2012 included FGL Sports results for 13
weeks compared to six weeks in Q3 2011 and reflected revenue growth
at Mark's and Petroleum, which were offset by revenue declines at
CTR.
Financial Services
Financial Services was a strong contributor to
the Company's earnings in the third quarter. Financial Services'
revenue increased 2.0% in the quarter and income before income
taxes increased 14.8% in the quarter compared to the prior year.
The earnings increase was due to increased revenue related to
credit card receivables growth, improved portfolio aging and
write-off performance, and lower operating expenses compared to the
prior year.
Capital Expenditures
Capital expenditures in the third quarter were $68.1 million compared to $120.2 million in the prior year. The decrease
was largely due to reduced spending on projects such as Automotive
Infrastructure, which was substantially completed prior to 2012,
and the timing of real estate expenses compared to last year.
Quarterly Dividend
Canadian Tire Corporation has declared a 16.7%
increase in the quarterly dividend, to 35
cents per share, on each Common and Class A Non-Voting
share. The dividend is payable March 1,
2013 to Common and Class A shareholders of record as of
January 31, 2013. The dividend is
considered an "eligible dividend" for tax purposes.
Dividends declared on Common and Class A
Non-Voting shares in the third quarter of 2012 of $0.30 per share are payable on December 1, 2012, to shareholders of record as of
October 31, 2012.
The Company's third quarter report will be
available in the Investor Centre section of the Company's website
at corp.canadiantire.ca and will be filed with SEDAR and available
at sedar.com.
In order to more closely align the timing of the
filing of documents with the announcement of results, the Company
expects to report fourth quarter and audited 2012 full-year results
and file the associated disclosure documents on SEDAR (including
annual Financial Statements and Management's Discussion and
Analysis) on Thursday, February 21,
2013. Timing of the disclosure will be confirmed via a media
advisory in January 2013.
Please refer to Management's Discussion and
Analysis for further detail and information on the following
charts.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated financial results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(C$ in millions except per share amounts) |
|
Q3 2012 |
|
Q3 2011 |
|
Change |
|
YTD Q3
2012 |
|
YTD Q3 2011 |
|
Change |
Retail sales |
|
$ |
3,171.9 |
|
$ |
2,938.1 |
|
8.0% |
|
$ |
9,072.0 |
|
$ |
7,941.2 |
|
14.2% |
Revenue |
|
|
2,829.8 |
|
|
2,704.9 |
|
4.6% |
|
|
8,260.5 |
|
|
7,252.0 |
|
13.9% |
Gross margin |
|
|
859.0 |
|
|
780.6 |
|
10.0% |
|
|
2,503.5 |
|
|
2,121.9 |
|
18.0% |
Other income |
|
|
0.8 |
|
|
10.2 |
|
(92.4)% |
|
|
0.5 |
|
|
12.6 |
|
(96.4)% |
Operating expenses |
|
|
648.8 |
|
|
588.7 |
|
10.2% |
|
|
1,950.6 |
|
|
1,636.2 |
|
19.2% |
EBITDA |
|
|
295.1 |
|
|
277.9 |
|
6.3% |
|
|
800.7 |
|
|
707.8 |
|
13.1% |
Depreciation and amortization |
|
|
84.1 |
|
|
75.8 |
|
10.9% |
|
|
247.3 |
|
|
209.5 |
|
18.0% |
Net finance costs |
|
|
31.7 |
|
|
32.1 |
|
(1.0)% |
|
|
92.8 |
|
|
99.3 |
|
(6.5)% |
Income before income taxes |
|
|
179.3 |
|
|
170.0 |
|
5.5% |
|
|
460.6 |
|
|
399.0 |
|
15.4% |
Effective Tax rate |
|
|
26.7% |
|
|
19.7% |
|
|
|
|
27.0% |
|
|
24.6% |
|
|
Net income |
|
|
131.4 |
|
|
136.5 |
|
(3.7)% |
|
|
336.1 |
|
|
300.7 |
|
11.8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
|
1.61 |
|
|
1.68 |
|
(3.7)% |
|
|
4.13 |
|
|
3.69 |
|
11.8% |
Diluted earnings per share |
|
|
1.61 |
|
|
1.67 |
|
(3.8)% |
|
|
4.11 |
|
|
3.68 |
|
11.8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail segment financial results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(C$ in millions) |
|
Q3 2012 |
|
Q3 2011 |
|
Change |
|
YTD Q3
2012 |
|
YTD Q3 2011 |
|
Change |
Retail sales |
|
$ |
3,171.9 |
|
$ |
2,938.1 |
|
8.0% |
|
$ |
9,072.0 |
|
$ |
7,941.2 |
|
14.2% |
Revenue |
|
|
2,564.4 |
|
|
2,443.8 |
|
4.9% |
|
|
7,480.1 |
|
|
6,488.6 |
|
15.3% |
Gross margin |
|
|
689.8 |
|
|
617.5 |
|
11.7% |
|
|
2,008.4 |
|
|
1,662.8 |
|
20.8% |
Other (expense) income |
|
|
0.7 |
|
|
10.3 |
|
(94.1)% |
|
|
(2.0) |
|
|
12.9 |
|
(116.1)% |
Operating expenses |
|
|
566.5 |
|
|
505.3 |
|
12.0% |
|
|
1,706.6 |
|
|
1,386.9 |
|
23.0% |
EBITDA |
|
|
205.6 |
|
|
195.5 |
|
5.2% |
|
|
539.8 |
|
|
490.3 |
|
10.1% |
Depreciation and amortization |
|
|
81.6 |
|
|
73.0 |
|
11.8% |
|
|
240.0 |
|
|
201.5 |
|
19.1% |
Net finance costs |
|
|
18.4 |
|
|
16.7 |
|
10.4% |
|
|
54.4 |
|
|
53.2 |
|
2.4% |
Income before income taxes |
|
|
105.6 |
|
|
105.8 |
|
(0.1)% |
|
|
245.4 |
|
|
235.6 |
|
4.1% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail Segment - by banner |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(C$ in millions, except number of
stores and gas bars) |
|
Q3 2012 |
Q3 2011 |
|
Change |
|
YTD Q3 2012 |
|
YTD Q3 2011 |
|
Change |
CTR retail sales growth1 |
|
|
0.3% |
|
|
3.2% |
|
|
|
|
1.4% |
|
|
1.8% |
|
|
CTR same store sales growth1 |
|
|
(0.2)% |
|
|
2.3% |
|
|
|
|
0.9% |
|
|
0.8% |
|
|
CTR revenue3 |
|
$ |
1,395.4 |
|
$ |
1,496.1 |
|
(6.7)% |
|
$ |
4,231.5 |
|
$ |
4,197.9 |
|
0.8% |
Number of CTR stores2 |
|
|
487 |
|
|
486 |
|
|
|
|
487 |
|
|
486 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canadian Tire Petroleum retail sales growth |
|
|
2.4% |
|
|
27.4% |
|
|
|
|
3.7% |
|
|
22.2% |
|
|
Canadian Tire Petroleum gasoline volume (litres) growth |
|
|
1.1% |
|
|
4.5% |
|
|
|
|
0.9% |
|
|
3.4% |
|
|
Canadian Tire Petroleum revenue |
|
$ |
543.4 |
|
$ |
534.5 |
|
1.7% |
|
$ |
1,539.8 |
|
$ |
1,490.3 |
|
3.3% |
Canadian Tire Petroleum gross margin |
|
$ |
39.8 |
|
$ |
38.6 |
|
3.3% |
|
$ |
109.8 |
|
$ |
110.8 |
|
(0.8)% |
Number of gas bars |
|
|
293 |
|
|
291 |
|
|
|
|
293 |
|
|
291 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FGL Sports retail sales growth4 |
|
|
4.2% |
|
|
6.6% |
|
|
|
|
4.7% |
|
|
n/a |
|
|
FGL Sports same store sales growth4 |
|
|
4.4% |
|
|
7.3% |
|
|
|
|
5.8% |
|
|
n/a |
|
|
FGL Sports revenue |
|
$ |
429.1 |
|
$ |
219.5 |
|
95.5% |
|
$ |
1,106.1 |
|
$ |
219.5 |
|
403.9% |
Number of FGL Sports stores |
|
|
490 |
|
|
528 |
|
|
|
|
490 |
|
|
528 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mark's retail sales growth |
|
|
2.0% |
|
|
1.9% |
|
|
|
|
4.6% |
|
|
2.9% |
|
|
Mark's same store sales growth |
|
|
1.7% |
|
|
1.5% |
|
|
|
|
3.8% |
|
|
2.7% |
|
|
Mark's revenue |
|
$ |
200.2 |
|
$ |
197.3 |
|
1.5% |
|
$ |
614.1 |
|
$ |
591.5 |
|
3.8% |
Number of Mark's
stores2 |
|
|
387 |
|
|
385 |
|
|
|
|
387 |
|
|
385 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Services segment financial
results |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(C$ in millions) |
|
Q3 2012 |
|
Q3 2011 |
|
Change |
|
YTD Q3 2012 |
|
YTD Q3 2011 |
|
Change |
Total gross average receivables |
|
$ |
4,116.1 |
|
$ |
4,061.1 |
|
1.4% |
|
$ |
4,058.2 |
|
$ |
4,026.7 |
|
0.8% |
Revenue |
|
|
249.7 |
|
|
245.0 |
|
2.0% |
|
|
733.9 |
|
|
716.9 |
|
2.4% |
Gross margin |
|
|
137.9 |
|
|
129.2 |
|
6.9% |
|
|
404.2 |
|
|
359.8 |
|
12.4% |
Operating expenses |
|
|
64.7 |
|
|
65.4 |
|
(0.8)% |
|
|
192.2 |
|
|
197.6 |
|
(2.7)% |
Income before income
taxes |
|
|
73.7 |
|
|
64.2 |
|
14.8% |
|
|
215.2 |
|
|
163.4 |
|
31.7% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To view a PDF version of Canadian Tire
Corporation's full quarterly earnings report please see:
http://files.newswire.ca/116/Q3_2012_English_CTC.pdf
FORWARD-LOOKING STATEMENTS
This document contains forward-looking information that reflects
management's current expectations related to matters such as future
financial performance and operating results of the
Company. Forward-looking statements are provided for the
purposes of providing information about management's current
expectations and plans and allowing investors and others to get a
better understanding of our financial position, results of
operation and operating environment. Readers are cautioned
that such information may not be appropriate for other
circumstances.
All statements other than statements of historical facts
included in this document may constitute forward-looking
information, including but not limited to, statements concerning
management's expectations relating to possible or assumed future
prospects and results, our strategic goals and priorities, our
actions and the results of those actions and the economic and
business outlook for us. Often but not always, forward-looking
information can be identified by the use of forward-looking
terminology such as "may", "will", "expect", "believe", "estimate",
"plan", "could", "should", "would", "outlook", "forecast",
"anticipate", "foresee", "continue" or the negative of these terms
or variations of them or similar terminology. Forward-looking
information is based on the reasonable assumptions, estimates,
analysis and opinions of management made in light of its experience
and perception of trends, current conditions and expected
developments, as well as other factors that management believes to
be relevant and reasonable at the date that such statements are
made.
By its very nature, forward-looking information requires us to
make assumptions and is subject to inherent risks and
uncertainties, which give rise to the possibility that the
Company's assumptions may not be correct and that the Company's
expectations and plans will not be achieved. Although the Company
believes that the forward-looking information in this document is
based on information and assumptions which are current, reasonable
and complete, this information is necessarily subject to a number
of factors that could cause actual results to differ materially
from management's expectations and plans as set forth in such
forward-looking information for a variety of reasons. Some of
the factors - many of which are beyond our control and the effects
of which can be difficult to predict - include (a) credit, market,
currency, operational, liquidity and funding risks, including
changes in economic conditions, interest rates or tax rates; (b)
the ability of Canadian Tire to attract and retain quality
employees, Dealers, Canadian Tire Petroleum agents and PartSource,
Mark's Work Wearhouse and FGL Sports store operators and
franchisees, as well as our financial arrangements with such
parties; (c) the growth of certain business categories and market
segments and the willingness of customers to shop at our stores or
acquire our financial products and services; (d) our margins and
sales and those of our competitors; (e) risks and uncertainties
relating to information management, technology, supply chain,
product safety, changes in law, regulation, competition,
seasonality, commodity price and business disruption, our
relationships with suppliers and manufacturers, changes to existing
accounting pronouncements, the risk of damage to the reputation of
brands promoted by Canadian Tire and the cost of store network
expansion and retrofits and (f) our capital structure, funding
strategy, cost management programs and share price. We caution
that the foregoing list of important factors and assumptions is not
exhaustive and other factors could also adversely affect our
results. Investors and other readers are urged to consider the
foregoing risks, uncertainties, factors and assumptions carefully
in evaluating the forward-looking information and are cautioned not
to place undue reliance on such forward-looking information.
For more information on the risks, uncertainties and assumptions
that could cause the Company's actual results to differ from
current expectations, please refer to the "Risk Factors" section of
our Annual Information Form for fiscal 2011 and our 2011
Management's Discussion and Analysis, as well as Canadian Tire's
other public filings, available at www.sedar.com and at
www.corp.canadiantire.ca.
Statements that include forward-looking information do not take
into account the effect that transactions or non-recurring or other
special items announced or occurring after the statements are made
have on the Company's business. For example, they do not
include the effect of any dispositions, acquisitions, asset
write-downs or other charges announced or occurring after such
statements are made.
The forward-looking statements and information contained herein
are based on certain factors and assumptions as of the date hereof.
The Company does not undertake to update any forward-looking
information, whether written or oral, that may be made from time to
time by it or on its behalf, to reflect new information, future
events or otherwise, unless required by applicable securities
laws.
CONFERENCE CALL
Canadian Tire will conduct a conference call to discuss
information included in this news release and related matters at
4:30 p.m. ET on November 8, 2012. The conference call will be
available simultaneously and in its entirety to all interested
investors and the news media through a webcast at
http://investors.canadiantire.ca, and will be available through
replay at this website for 12 months.
ABOUT CANADIAN TIRE
Canadian Tire Corporation, Limited (TSX:CTC) (TSX:CTC.a) is one
of Canada's most-shopped general
retailers and the country's largest sporting goods retailer, with
more than 1,700 retail and gasoline outlets from coast-to-coast.
Our primary retail business categories - Automotive, Living,
Fixing, Sports, Playing and Apparel - are supported and
strengthened by our Financial Services division, which offers such
products and services as Canadian Tire home services, credit cards,
retail deposits, in-store financing, product warranties, and
insurance. Nearly 68,000 people are employed across the Canadian
Tire enterprise, which was founded in 1922 and remains one of
Canada's most recognized and
trusted brands.
SOURCE CANADIAN TIRE CORPORATION, LIMITED
PDF available at:
http://stream1.newswire.ca/media/2012/11/08/20121108_C6120_DOC_EN_20331.pdf