TORONTO, Feb. 16,
2023 /CNW/ - Canadian Tire Corporation, Limited
(TSX: CTC) (TSX: CTC.A) ("CTC" or the "Company") today released its
fourth quarter and full-year results for the period ended
December 31, 2022.
- Diluted Earnings Per Share (EPS) in the fourth quarter was a
record $9.09; full-year diluted EPS
was $17.60
- Full-year 2022 consolidated comparable sales1 for
the Retail segment were up 2.7% and Q4 was in line with 2021's
exceptional performance, when comparable sales were up 11.3%
- Over $750 million of capital was
returned to shareholders in fiscal year 2022 and approximately
$850 million was invested in total
capital expenditures
"Our record fourth-quarter EPS performance was a great finish to
a remarkable centennial year. These results, combined with a strong
retail topline over the year, demonstrate we managed well through a
dynamic economic environment," said Greg
Hicks, President and CEO, Canadian Tire Corporation. "Our
Triangle Membership delivered outsized growth over the year and
continues to provide us with the rich first party data needed to
offer personalized experiences and ultimately drive spend."
"In 2023, we will continue to focus on delivering value to our
customers through the unique capabilities of our Owned Brands,
multi-category assortment, and Triangle Rewards," said Hicks. "With
these assets and the resilience of our brand, people and Better
Connected strategy, we are better positioned than ever to compete
and win."
FOURTH QUARTER HIGHLIGHTS
- Consolidated retail sales1 were up 1.2% compared to
the fourth quarter of 2021, and up 17.6% on a three-year stacked
basis1; consolidated comparable sales1 were
in line with 2021's exceptional performance, and up 21.1% on a
three-year stacked basis
-
- Canadian Tire Retail comparable sales1 were in line
with 2021, when comparable sales were up 9.8%; Automotive continued
to deliver the strongest growth in the fourth quarter
- Mark's had its tenth consecutive quarter of comparable
sales1 growth, up 4.3%, driven by strength in footwear
categories
- Licensed apparel sales partly offset declines in categories
such as outerwear at SportChek, which ended the quarter down
1.7%
- Helly Hansen was a strong contributor to retail revenue growth
in the quarter, up 20.6%, led by increased sales of sportswear
through its North American channels
- Q4 Diluted Earnings Per Share was a record $9.09, up 9% compared to Q4 2021; normalized
diluted EPS1 was up 11% to $9.34, driven mainly by higher revenue in both
Retail and Financial Services, and a higher Retail gross margin
rate1
-
- Retail segment income before income taxes (IBT) was
$642.4 million, up from $638.1 million in Q4 2021, driven by an increase
in retail revenue of 3.3%, or 2.3% excluding Petroleum1,
and retail gross margin dollars up 3.5%; retail gross margin rate
(excluding Petroleum)1 was up 40 basis points
- Financial Services delivered strong quarterly IBT, up 37.5% to
$86.8 million, with higher revenue,
up 14.3%, and lower operating expense
FULL YEAR HIGHLIGHTS
- Driven by strong revenue growth across both Retail and
Financial Services segments, normalized diluted EPS was
$18.75, compared to a record level of
$18.91 in 2021, representing a 44.4%
increase on a three-year stacked basis1; Diluted EPS was
$17.60, compared to $18.38 in 2021
-
- Retail revenue was up 9.0% compared to 2021 and retail revenue
excluding Petroleum was up 5.6%, outpacing retail sales which were
up 5.4%, or 2.4% excluding Petroleum1, with growth
across all banners; strong retail revenue growth was offset by the
impacts of higher freight and product cost inflation on gross
margin, higher operating expense, and lower other income, mainly as
a result of the unfavourable impact of foreign exchange, which led
to a decrease in retail earnings for the year
- Financial Services revenue was up 14.5% compared to 2021, as a
result of higher income and fees as well as strong receivables
growth and credit card spend, which drove an increase in full-year
earnings
- The Company delivered an improved omni-channel customer
experience as it continued to invest in its Better Connected
strategy and its key strategic differentiators
-
- Triangle Loyalty member sales1 were up 8%,
continuing to outpace total retail sales, with 11.3 million active
members in the program and loyalty penetration1 of close
to 60% in 2022
- Owned Brands sales1 remained strong, at 37.6% of
total retail sales, and the Company continued to grow its Owned
Brands portfolio, with significant growth in the ProSeries and
Forward With Design brands to $160
million and $24 million,
respectively, and Mark's achieving $1
billion in Owned Brands sales
- The investments being made to enhance the customer experience
at Canadian Tire delivered strong growth at the 36 stores that were
refreshed, expanded or replaced during 2022 and Canadian Tire
remains on track with its plans to grow pet categories; the rollout
of dedicated PetCo shop-in-shop experiences to 90% of Canadian Tire
stores expected to be completed in the summer of 2023
- The Company achieved its additional $100
million target in annualized Operational Efficiency program
run-rate savings, taking the annualized run-rate savings to more
than $300 million since launching the
program in 2019
- The Company returned over $750
million to shareholders, through $425
million of share repurchases and $325
million in dividends, in fiscal 2022
CONSOLIDATED OVERVIEW
FOURTH QUARTER
- Revenue increased 3.9% over the same period last year to
$5,340.4 million; Revenue (excluding
Petroleum)1 increased 3.1%, with the Retail and
Financial Services segments both contributing to growth
- Consolidated IBT was $752.2
million, up 4.5% compared to the fourth quarter of 2021, and
$771.8 million, up 6.2%, on a
normalized1 basis
- Diluted EPS was $9.09, compared
to $8.34 in the prior year;
normalized diluted EPS was $9.34,
compared to $8.42 in the prior
year
- Refer to the Company's Q4 and Full-Year 2022 Management
Discussion and Analysis (MD&A) section 5.1.1 for information on
normalizing items and for additional details on events that have
impacted the Company in the quarter
FULL YEAR
- Consolidated retail sales were $19,248.8
million, up $984.2 million, or
5.4% over the prior year. Consolidated retail sales, excluding
Petroleum, increased 2.4%
- Revenue increased 9.3% to $17,810.6
million; Revenue (excluding Petroleum)1 increased
6.3% over the same period last year, with the Retail and Financial
Services segments both contributing to growth
- Consolidated IBT was $1,583.8
million, down 6.9% compared to 2021, and $1,667.5 million, down 4.3%, on a normalized
basis
- Diluted EPS was $17.60, compared
to $18.38 in the prior year;
normalized diluted EPS was $18.75,
compared to $18.91 in the prior
year
- Retail Return on Invested Capital (ROIC)1 calculated
on a trailing twelve-month basis, was 12.5% at the end of the
fourth quarter of 2022, compared to 13.6% at the end of the fourth
quarter of 2021, mainly due to the increase in Average Retail
Invested Capital over the prior period
- Refer to the Company's Q4 and Full-Year 2022 MD&A section
5.1.1 for information on normalizing items and for additional
details on events that have impacted the Company in the
quarter
RETAIL SEGMENT OVERVIEW
FOURTH QUARTER
- Retail revenue was $4,990.9
million, an increase of $160.9
million, or 3.3%, compared to the prior year; excluding
Petroleum, Retail revenue increased 2.3%
- Retail sales were $5,729.4
million, up 1.2%, compared to the fourth quarter of 2021 and
Retail sales (excluding Petroleum) were up 0.2%; consolidated
comparable sales increased 0.3%
- CTR retail sales1 and comparable sales were flat
over the same period last year
- SportChek retail sales1 were down 1.6% over the same
period last year, and comparable sales1 were down
1.7%
- Mark's retail sales1 increased 4.4% over the same
period last year, and comparable sales were up 4.3%
- Helly Hansen revenue was up 20.6% compared to the same period
in 2021
- Retail gross margin was up 3.5% compared to the fourth quarter
of 2021, or 3.4% excluding Petroleum; retail gross margin rate
(excluding Petroleum) was up 40 basis points to 39.9%
- Retail IBT was $642.4 million,
compared to $638.1 million in the
prior year; normalized IBT1 was $662.0 million, up 2.7%
- Refer to the Company's Q4 and Full-Year 2022 MD&A section
5.1.1 for information on normalizing items and for additional
details on events that have impacted the Company in the
quarter
FINANCIAL SERVICES OVERVIEW
FOURTH QUARTER
- Gross average accounts receivable ("GAAR")1 was up
12.4% relative to the prior year, with average active accounts up
6.1%, and average account balances also up in the quarter
- Credit card sales growth1 slowed to 4.0% in the
quarter, compared to 24.8% in the same quarter in the prior
year
- Financial Services gross margin was $180.4 million, an increase of $9.7 million, or 5.7% compared to the prior year,
mainly due to strong revenue growth, partially offset by higher net
impairment losses
- Financial Services IBT was $86.8
million, up $23.8 million, or
37.5% compared to the prior year
- Refer to the Company's Q4 and Full-Year 2022 MD&A section
5.3.1 and 5.3.2 for additional details on events that have impacted
the Company
CT REIT OVERVIEW
FOURTH QUARTER AND FULL-YEAR
- CT REIT announced four new investments totalling $31 million in the fourth quarter
- CT REIT added nearly 1 million square feet of gross leasable
area to its portfolio in 2022
- For further information, refer to the Q4 2022 CT REIT earnings release issued on
February 14, 2023
CAPITAL ALLOCATION
CAPITAL EXPENDITURES
- Operating capital expenditures1 were $747.6 million in 2022, compared to $669.8 million in 2021
- Total capital expenditures were $848.7
million, compared to $803.9
million in 2021
QUARTERLY DIVIDEND
- The Company declared dividends payable to holders of Class A
Non-Voting Shares and Common Shares at a rate of $1.725 per share, payable on June 1, 2023, to shareholders of record as of
April 30, 2023. The dividend is
considered an "eligible dividend" for tax purposes.
SHARE REPURCHASES
- On November 10, 2022, the Company
announced its intention to repurchase an additional $500 million to $700
million of its Class A Non-Voting Shares (the "Shares"), in
excess of the amount required for anti-dilutive purposes, by the
end of 2023 as part of its capital management plan (the "2022-23
Share Repurchase Intention"). To date, the Company has repurchased
$208 million of its Shares in partial
fulfilment of its 2022-23 Share Repurchase Intention.
NORMAL COURSE ISSUER BID
- The Company announced its intention to make a normal course
issuer bid (the "2023-24 NCIB") to repurchase from March 2, 2023 to March 1,
2024 up to 5,100,000 Shares, which represents approximately
10% of the 51,274,131 public float of Shares issued and outstanding
as at February 15, 2023. There were
53,726,997 total issued and outstanding Shares as at February 15, 2023.
- The Company intends to repurchase Shares under the 2023-24 NCIB
for two purposes: (i) to fulfill the remainder of the 2022-23 Share
Repurchase Intention; and (ii) to offset the dilutive effect of the
issuance of Shares pursuant to its dividend reinvestment and stock
option plans, consistent with the Company's policy.
- Repurchases of Shares pursuant to the 2023-24 NCIB will be made
by means of open market transactions through the facilities of the
TSX and/or alternative Canadian trading systems, if eligible, at
the market price of the Shares at the time of repurchase or as
otherwise permitted under the rules of the TSX and applicable
securities laws. Repurchases may also be made by way of private
agreements or share repurchase programs under issuer bid exemption
orders issued by securities regulatory authorities. Any private
repurchase made under an exemption order issued by a securities
regulatory authority will generally be at a discount to the
prevailing market price.
- For open market transactions, the Company will be subject to a
daily repurchase limit of 62,616 Shares, which represents 25% of
250,466, the average daily trading volume of the Shares on the TSX,
net of repurchases made by the Company through the TSX, for the six
months ended January 31, 2023. The
Shares repurchased by the Company pursuant to the 2023-24 NCIB will
be restored to the status of authorized but unissued shares.
- The Company's proposed 2023-24 NCIB is subject to regulatory
approval.
- Under the Company's normal course issuer bid which began on
March 2, 2022, and expires on
March 1, 2023 (the "2022-23 NCIB"),
the Company received approval to repurchase up to 5,300,000 Shares.
To date, the Company has repurchased a total of 2,597,769 Shares by
means of open market transactions through the facilities of the TSX
and alternative Canadian trading systems under the Company's
2022-23 NCIB, at the volume weighted average price of $160.60.
AUTOMATIC SECURITIES PURCHASE PLAN
- The Company announced that it will enter into an automatic
securities purchase plan (the "ASPP") with a designated broker to
facilitate repurchases of Shares under its 2023-24 NCIB at times
when the Company would ordinarily not be permitted to repurchase
its securities due to regulatory restrictions and customary
self-imposed black-out periods. Repurchases made pursuant to the
ASPP will be made by the Company's designated broker based upon the
parameters prescribed by the TSX, applicable Canadian securities
laws and the terms of the written agreement between the Company and
its designated broker. The ASPP will commence on March 2, 2023 and terminate on the earliest of
the date on which: (i) the repurchase limit under the 2023-24 NCIB
has been reached; (ii) the 2023-24 NCIB expires; and (iii) the
Company terminates the ASPP in accordance with its terms. The ASPP
constitutes an "automatic securities purchase plan" under
applicable Canadian securities laws. The Company's proposed ASPP is
subject to regulatory approval.
(1) NON-GAAP FINANCIAL MEASURES AND RATIOS AND
SUPPLEMENTARY FINANCIAL MEASURES
This press release contains non-GAAP financial measures and
ratios and supplementary financial measures. References below to
the Q4 2022 MD&A mean the Company's Management's Discussion and
Analysis for the Fourth Quarter and Full-Year ended December 31, 2022, which is available on SEDAR
at www.sedar.com and is incorporated by reference herein.
Non-GAAP measures and non-GAAP ratios have no standardized meanings
under GAAP and may not be comparable to similar measures of other
companies.
(A) Non-GAAP Financial Measures and
Ratios
Normalized Diluted Earnings per Share (EPS)
Normalized diluted EPS, a non-GAAP ratio, is calculated by
dividing Normalized Net Income Attributable to Shareholders, a
non-GAAP financial measure, by total diluted shares of the Company.
For information about these measures, see section 10.1 of the
Company's Q4 and Full-Year 2022 MD&A.
Normalized diluted EPS growth on a three-year stacked basis is
calculated by adding the year-over-year growth calculated for each
of the past three years.
The following table is a reconciliation of normalized net income
attributable to shareholders of the Company to the respective GAAP
measures:
(C$ in millions, except
per share amounts)
|
Q4 2022
|
Q4 2021
|
2022
|
2021
|
2020
|
2019
|
Net income
|
$ 562.6
|
$ 535.7
|
$
1,182.8
|
$
1,260.7
|
$ 862.6
|
$ 894.8
|
Net income attributable
to shareholders
|
531.9
|
508.5
|
1,044.1
|
1,127.6
|
751.8
|
778.4
|
Add normalizing
items:
|
|
|
|
|
|
|
Operational Efficiency
program
|
$
14.4
|
$
4.8
|
$
34.7
|
$ 30.1
|
$ 42.3
|
$ 25.1
|
Helly Hansen Russia
exit
|
—
|
—
|
33.4
|
—
|
—
|
—
|
Party City:
|
|
|
|
|
|
|
Acquisition-related costs
|
—
|
—
|
—
|
—
|
—
|
1.6
|
Fair value
adjustment for inventories acquired
|
—
|
—
|
—
|
—
|
—
|
1.8
|
Normalized net income
|
$ 577.0
|
$ 540.5
|
$
1,250.9
|
$
1,290.8
|
$ 904.9
|
$ 923.3
|
Normalized net income attributable to
shareholders
|
$ 546.3
|
$ 513.3
|
$
1,112.2
|
$
1,157.7
|
$ 794.1
|
$ 806.9
|
Normalized diluted EPS
|
$
9.34
|
$ 8.42
|
$ 18.75
|
$ 18.91
|
$ 13.00
|
$ 13.04
|
Consolidated Normalized Income Before Income Taxes and Retail
Normalized Income Before Income Taxes
Consolidated Normalized Income Before Income Taxes and Retail
Normalized Income before Income Taxes are non-GAAP financial
measures. For information about these measures, see section
10.1 of the Company's Q4 and Full-Year 2022 MD&A.
The following table reconciles Consolidated Normalized Income
Before Income Taxes to Income Before Income Taxes:
(C$ in
millions)
|
Q4
2022
|
Q4 2021
|
2022
|
2021
|
Income before income
taxes
|
$
752.2
|
$
720.0
|
$
1,583.8
|
$
1,701.9
|
Add normalizing
items:
|
|
|
|
|
Operational Efficiency
program
|
19.6
|
6.5
|
47.2
|
40.9
|
Helly Hansen Russia
exit
|
—
|
—
|
36.5
|
—
|
Normalized income
before income taxes
|
$
771.8
|
$
726.5
|
$
1,667.5
|
$ 1,742.8
|
The following table reconciles Retail Normalized Income Before
Income Taxes to Retail Income Before Income Taxes:
(C$ in
millions)
|
Q4
2022
|
Q4 2021
|
2022
|
2021
|
Income before income
taxes
|
$
752.2
|
$
720.0
|
$
1,583.8
|
$
1,701.9
|
Less: Other operating
segments
|
109.8
|
81.9
|
535.8
|
526.2
|
Retail income before
income taxes
|
$
642.4
|
$
638.1
|
$
1,048.0
|
$
1,175.7
|
Add normalizing
items:
|
|
|
|
|
Operational Efficiency
program
|
19.6
|
6.5
|
47.2
|
40.9
|
Helly Hansen Russia
exit
|
—
|
—
|
36.5
|
—
|
Retail normalized
income before income taxes
|
$
662.0
|
$
644.6
|
$
1,131.7
|
$
1,216.6
|
Retail Return on Invested Capital
Retail Return on Invested Capital (ROIC) is calculated as Retail
return divided by the Retail invested capital. Retail return is
defined as trailing annual Retail after-tax earnings excluding
interest expense, lease related depreciation expense, inter-segment
earnings, and any normalizing items. Retail invested capital is
defined as Retail segment total assets, less Retail segment trade
payables and accrued liabilities and inter-segment balances based
on an average of the trailing four quarters. Retail return and
Retail invested capital are non-GAAP financial measures. For more
information about these measures, see section 10.1 of the Company's
Q4 and Full-Year 2022 MD&A.
|
Rolling 12 months
ended
|
(C$ in
millions)
|
2022
|
2021
|
Income before income
taxes
|
$
1,583.8
|
$
1,701.9
|
Less: Other operating
segments
|
535.8
|
526.2
|
Retail income before
income taxes
|
$
1,048.0
|
$
1,175.7
|
Add normalizing
items:
|
|
|
Operational Efficiency
program
|
47.2
|
40.9
|
Helly Hansen Russia
exit
|
36.5
|
—
|
Retail normalized
income before income taxes
|
$
1,131.7
|
$
1,216.6
|
Less:
|
|
|
Retail intercompany
adjustments1
|
207.1
|
196.5
|
Add:
|
|
|
Retail interest
expense2
|
246.7
|
251.8
|
Retail depreciation of
right-of-use assets
|
589.4
|
541.5
|
Retail effective tax
rate
|
25.9 %
|
27.1 %
|
Add: Retail
taxes
|
(456.4)
|
(491.4)
|
Retail
return
|
$
1,304.3
|
$
1,322.0
|
|
|
|
Average total
assets
|
$
21,734.5
|
$ 21,364.1
|
Less: Average assets in
other operating segments
|
4,413.5
|
5,026.0
|
Average Retail
assets
|
$
17,321.0
|
$ 16,338.1
|
Less:
|
|
|
Average Retail
intercompany adjustments1
|
3,534.8
|
3,421.2
|
Average Retail trade
payables and accrued liabilities3
|
2,924.5
|
2,519.8
|
Average Franchise Trust
assets
|
458.0
|
507.6
|
Average
Retail excess cash
|
—
|
167.4
|
Average Retail
invested capital
|
$
10,403.7
|
$
9,722.1
|
Retail
ROIC
|
12.5 %
|
13.6 %
|
1
|
Intercompany
adjustments include intercompany income received from CT
REIT which is included in the Retail segment, and intercompany
investments made by the Retail segment in CT REIT and
CTFS.
|
2
|
Excludes Franchise
Trust.
|
3
|
Trade payables and
accrued liabilities include trade and other payables, short-term
derivative liabilities, short-term provisions and income tax
payables.
|
Operating Capital Expenditures
Operating capital expenditures is a non-GAAP financial measure.
For more information about this measure, see section 10.1 of the
Company's Q4 and Full-Year 2022 MD&A.
The following table reconciles total additions from the
Investing activities reported in the Consolidated Statement of Cash
Flows to Operating capital expenditures:
(C$ in
millions)
|
2022
|
2021
|
Total
additions1
|
$
834.6
|
$
778.8
|
Add: Accrued
additions
|
14.1
|
10.8
|
Less:
|
|
|
Business combinations,
intellectual properties and tenant allowances
|
—
|
(14.3)
|
CT REIT acquisitions
and developments excluding vend-ins from CTC
|
101.1
|
134.1
|
Operating capital
expenditures
|
$
747.6
|
$
669.8
|
1
|
This line appears on
the Consolidated Statement of Cash Flows under Investing
activities.
|
(B) Supplementary Financial Measures and
Ratios
The measures below are supplementary financial measures.
See Section 10.2 (Supplementary
Financial Measures) of the Company's Q4 and Full-Year 2022 MD&A
for information on the composition of these measures.
- Consolidated retail sales
- Consolidated comparable sales
- Consolidated comparable sales (excluding Petroleum)
- Revenue (excluding Petroleum)
- Retail revenue (excluding Petroleum)
- Retail sales and retail sales (excluding Petroleum)
- Canadian Tire Retail comparable and retail sales
- SportChek comparable and retail sales
- Mark's comparable and retail sales
- Retail gross margin (excluding Petroleum)
- Gross Average Accounts Receivables (GAAR)
- Credit card sales growth
- Triangle member loyalty sales
- Loyalty penetration
- Owned Brands sales
Consolidated retail sales growth on a three-year stacked basis
is calculated by adding the year-over-year growth calculated for
each of the past three years.
To view a PDF version of Canadian Tire Corporation's full
quarterly earnings report please see:
https://mma.prnewswire.com/media/2003800/CANADIAN_TIRE_CORPORATION__LIMITED_Canadian_Tire_Corporation_Rep.pdf
FORWARD-LOOKING STATEMENTS
This press release contains information that may constitute
forward-looking information within the meaning of applicable
securities laws. Forward-looking information provides insights
regarding management's current expectations and plans and allows
investors and others to better understand the Company's anticipated
financial position, results of operations and operating
environment. Readers are cautioned that such information may not be
appropriate for other purposes. Although the Company believes that
the forward-looking information in this press release is based on
information, assumptions and beliefs that are current, reasonable,
and complete, such information is necessarily subject to a number
of business, economic, competitive and other risk factors that
could cause actual results to differ materially from management's
expectations and plans as set forth in such forward-looking
information. The Company cannot provide assurance that any
financial or operational performance, plans, or aspirations
forecast will actually be achieved or, if achieved, will result in
an increase in the Company's share price. For information on the
material risk factors and uncertainties and the material factors
and assumptions applied in preparing the forward-looking
information that could cause the Company's actual results to differ
materially from predictions, forecasts, projections, expectations
or conclusions, refer to section 11.0 (Key Risks and Risk
Management) of our Management's Discussion and Analysis for the
Fourth Quarter and Full-Year ended December
31, 2022 as well as CTC's other public filings, available at
http://www.sedar.com and at https://investors.canadiantire.ca.
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, except as is 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
8:00 a.m. ET on February 16, 2023. The conference call will be
available simultaneously and in its entirety to all interested
investors and the news media through a webcast at
https://investors.canadiantire.ca and will be available
through replay at this website for 12 months.
ABOUT CANADIAN TIRE CORPORATION
Canadian Tire Corporation, Limited, (TSX: CTC.A) (TSX: CTC) or
"CTC", is a group of companies that includes a Retail segment, a
Financial Services division and CT REIT. Our retail business is led
by Canadian Tire, which was founded in 1922 and provides Canadians
with products for life in Canada
across its Living, Playing, Fixing, Automotive and Seasonal &
Gardening divisions. Party City, PartSource and Gas+ are key parts
of the Canadian Tire network. The Retail segment also includes
Mark's, a leading source for casual and industrial wear; Pro Hockey
Life, a hockey specialty store catering to elite players; and
SportChek, Hockey Experts, Sports Experts and Atmosphere, which
offer the best active wear brands. The more than 1,700 retail and
gasoline outlets are supported and strengthened by
CTC's Financial Services division and the tens of thousands of
people employed across Canada and
around the world by CTC and its local dealers, franchisees and
petroleum retailers. In addition, CTC owns and operates Helly
Hansen, a leading technical outdoor brand based in Oslo, Norway. For more information, visit
Corp.CanadianTire.ca.
FOR MORE INFORMATION
Media: Stephanie Nadalin, (647) 271-7343,
stephanie.nadalin@cantire.com
Investors: Karen Keyes, (647)
518-4461, karen.keyes@cantire.com
Consolidated Balance Sheets (unaudited)
|
|
|
As at
(C$ in
millions)
|
December 31, 2022
|
January 1,
2022
|
ASSETS
|
|
|
Cash and cash
equivalents
|
$
331.3
|
$
1,751.7
|
Short-term
investments
|
176.3
|
606.2
|
Trade and other
receivables
|
1,309.9
|
970.4
|
Loans
receivable
|
6,271.1
|
5,613.2
|
Merchandise
inventories
|
3,216.1
|
2,480.6
|
Income taxes
recoverable
|
27.4
|
1.7
|
Prepaid expenses and
deposits
|
195.7
|
216.1
|
Assets classified as
held for sale
|
2.6
|
6.7
|
Total current assets
|
11,530.4
|
11,646.6
|
Long-term receivables
and other assets
|
676.7
|
593.5
|
Long-term
investments
|
62.6
|
175.1
|
Goodwill and
intangible assets
|
2,341.6
|
2,372.2
|
Investment
property
|
421.5
|
460.7
|
Property and
equipment
|
4,994.1
|
4,549.3
|
Right-of-use
assets
|
1,932.0
|
1,786.1
|
Deferred income
taxes
|
143.4
|
218.7
|
Total assets
|
$
22,102.3
|
$
21,802.2
|
LIABILITIES
|
|
|
Bank
indebtedness
|
$
5.0
|
$
—
|
Deposits
|
1,226.3
|
1,908.4
|
Trade and other
payables
|
3,200.9
|
2,914.3
|
Provisions
|
197.2
|
195.2
|
Short-term
borrowings
|
576.2
|
108.2
|
Loans
|
472.9
|
427.5
|
Current portion of
lease liabilities
|
381.2
|
359.0
|
Income taxes
payable
|
47.1
|
157.6
|
Current portion of
long-term debt
|
1,040.2
|
719.8
|
Total current liabilities
|
7,147.0
|
6,790.0
|
Long-term
provisions
|
66.1
|
64.1
|
Long-term
debt
|
3,217.5
|
3,558.7
|
Long-term
deposits
|
1,739.4
|
1,985.3
|
Long-term lease
liabilities
|
2,026.4
|
1,916.8
|
Deferred income
taxes
|
132.1
|
125.9
|
Other long-term
liabilities
|
734.6
|
850.6
|
Total liabilities
|
15,063.1
|
15,291.4
|
EQUITY
|
|
|
Share
capital
|
587.8
|
593.6
|
Contributed
surplus
|
2.9
|
2.9
|
Accumulated other
comprehensive (loss)
|
(42.4)
|
(169.2)
|
Retained
earnings
|
5,070.2
|
4,696.5
|
Equity attributable to shareholders of Canadian Tire
Corporation
|
5,618.5
|
5,123.8
|
Non-controlling
interests
|
1,420.7
|
1,387.0
|
Total equity
|
7,039.2
|
6,510.8
|
Total liabilities and equity
|
$
22,102.3
|
$
21,802.2
|
Consolidated Statements of Income
(unaudited)
|
|
|
|
|
|
|
For the
|
|
13 weeks ended
|
|
52 weeks ended
|
(C$ in millions,
except per share amounts)
|
|
December 31,
2022
|
|
January 1,
2022
|
|
December 31,
2022
|
|
January 1,
2022
|
Revenue
Cost of producing
revenue
|
$
|
5,340.4
3,322.0
|
$
|
5,137.6
3,190.9
|
$
|
17,810.6
11,712.7
|
$
|
16,292.1
10,456.9
|
Gross margin
Other expense
(income)
Selling, general and
administrative expenses
Net finance costs
|
|
2,018.4
0.2
1,200.1
65.9
|
|
1,946.7
5.2
1,167.4
54.1
|
|
6,097.9
61.6
4,221.5
231.0
|
|
5,835.2
(23.5)
3,934.3
222.5
|
Income before income taxes
Income taxes
|
|
752.2
189.6
|
|
720.0
184.3
|
|
1,583.8
401.0
|
|
1,701.9
441.2
|
Net income
|
$
|
562.6
|
$
|
535.7
|
$
|
1,182.8
|
$
|
1,260.7
|
Net income
attributable to:
Shareholders of
Canadian Tire Corporation
Non-controlling interests
|
$
|
531.9
30.7
|
$
|
508.5
27.2
|
$
|
1,044.1
138.7
|
$
|
1,127.6
133.1
|
|
$
|
562.6
|
$
|
535.7
|
$
|
1,182.8
|
$
|
1,260.7
|
Basic earnings per share
|
$
|
9.13
|
$
|
8.40
|
$
|
17.70
|
$
|
18.56
|
Diluted earnings per share
|
$
|
9.09
|
$
|
8.34
|
$
|
17.60
|
$
|
18.38
|
Weighted average number of Common and Class A
Non-Voting Shares
outstanding:
Basic Diluted
|
|
58,237,893
58,499,745
|
|
60,553,762
61,008,556
|
|
58,983,364
59,336,919
|
|
60,744,440
61,345,072
|
Consolidated Statements of Comprehensive Income
(unaudited)
|
|
|
|
|
|
|
|
|
|
For the
|
|
13 weeks ended
|
|
52 weeks ended
|
(C$ in
millions)
|
|
December 31,
2022
|
|
January 1,
2022
|
|
December 31,
2022
|
|
January 1,
2022
|
Net income
|
$
|
562.6
|
$
|
535.7
|
$
|
1,182.8
|
$
|
1,260.7
|
Other comprehensive income (loss), net of
taxes
|
|
|
|
|
|
|
|
|
Items that may be reclassified subsequently to
net
income:
|
|
|
|
|
|
|
|
|
Net fair value (losses) gains on hedging instruments
entered into for cash flow hedges
not subject to basis
adjustment
|
|
(8.2)
|
|
(4.1)
|
|
77.1
|
|
5.4
|
Deferred cost of hedging not subject to basis adjustment
– Changes in fair value of the
time value of an option in
relation to time-period related
hedged items
|
|
(8.6)
|
|
1.4
|
|
4.1
|
|
1.4
|
Reclassification of losses to income
|
|
—
|
|
2.4
|
|
5.7
|
|
14.1
|
Currency translation adjustment
|
|
71.4
|
|
(22.0)
|
|
(26.0)
|
|
(34.7)
|
Item that will not
be reclassified subsequently to net
income:
|
|
|
|
|
|
|
|
|
Actuarial gains (losses)
|
|
41.3
|
|
(0.7)
|
|
41.3
|
|
(0.7)
|
Net fair vale gains (losses) on hedging instruments
entered into for cash flow hedges
subject to basis
adjustment
|
|
(39.6)
|
|
4.4
|
|
165.8
|
|
5.7
|
Other comprehensive
income (loss)
|
|
56.3
|
|
(18.6)
|
|
268.0
|
|
(8.8)
|
Other comprehensive
income (loss) attributable to:
|
|
|
|
|
|
|
|
|
Shareholders of
Canadian Tire Corporation
|
$
|
58.3
|
$
|
(18.4)
|
$
|
249.2
|
$
|
(12.9)
|
Non-controlling
interests
|
|
(2.0)
|
|
(0.2)
|
|
18.8
|
|
4.1
|
|
$
|
56.3
|
$
|
(18.6)
|
$
|
268.0
|
$
|
(8.8)
|
Comprehensive income
|
$
|
618.9
|
$
|
517.1
|
$
|
1,450.8
|
$
|
1,251.9
|
Comprehensive income
attributable to:
|
|
|
|
|
|
|
|
|
Shareholders of Canadian Tire Corporation
|
$
|
590.2
|
$
|
490.1
|
$
|
1,293.3
|
$
|
1,114.7
|
|
|
|
|
|
|
|
|
|
Non-controlling interests
|
|
28.7
|
|
27.0
|
|
157.5
|
|
137.2
|
|
$
|
618.9
|
$
|
517.1
|
$
|
1,450.8
|
$
|
1,251.9
|
Consolidated Statements of Cash Flows
(unaudited)
|
|
|
|
|
|
For
the
|
13 weeks ended
|
52 weeks ended
|
(C$ in
millions)
|
December 31,
2022
|
January 1,
2022
|
December 31,
2022
|
January 1,
2022
|
Cash (used for) generated from:
Operating activities Net income
Adjustments for:
Depreciation of
property and equipment, investment property and
right-of-use assets
Impairment on
property and equipment, investment property and
right-of-use assets
Income taxes
Net finance costs
Amortization of
intangible assets
(Gain) loss on
disposal of property and equipment, investment
property, assets held for sale and right-of-use
assets
Non-cash loss on exit
of Helly Hansen operations in Russia
Total except as noted below
Interest paid
Interest received
Income taxes paid
Change in loans
receivable1
Change in operating
working capital and other
|
$
562.6
|
$
535.7
|
$
1,182.8
|
$
1,260.7
|
162.2
|
148.3
|
621.0
|
581.9
|
3.1
|
6.2
|
3.1
|
5.3
|
189.6
|
184.3
|
401.0
|
441.2
|
65.9
|
54.1
|
231.0
|
222.5
|
32.1
|
30.0
|
122.5
|
119.6
|
(13.7)
|
0.1
|
(22.1)
|
(18.6)
|
—
|
—
|
20.8
|
—
|
1,001.8
|
958.7
|
2,560.1
|
2,612.6
|
(67.2)
|
(43.6)
|
(254.6)
|
(233.0)
|
6.1
|
4.3
|
21.3
|
13.9
|
(80.2)
|
(53.0)
|
(529.3)
|
(333.9)
|
(196.0)
|
(291.3)
|
(657.1)
|
(565.3)
|
346.2
|
501.6
|
(574.4)
|
241.6
|
Cash generated from operating
activities
|
1,010.7
|
1,076.7
|
566.0
|
1,735.9
|
Investing activities
Additions to property
and equipment and investment property
Additions to intangible assets
Total
additions
Acquisition of
short-term investments
Proceeds from the
maturity and disposition of short-term
investments
Proceeds on
disposition of property and equipment, investment
property and assets held for sale
Lease payments
received for finance subleases (principal portion)
Acquisition of long-term investments and other
Change in Franchise
Trust Loans Receivable1
|
(261.2)
|
(298.7)
|
(712.0)
|
(630.6)
|
(34.1)
|
(44.8)
|
(122.6)
|
(148.2)
|
(295.3)
|
(343.5)
|
(834.6)
|
(778.8)
|
(32.2)
|
(427.7)
|
(166.9)
|
(1,185.4)
|
63.5
|
434.3
|
713.1
|
1,290.2
|
(0.5)
|
(0.4)
|
5.2
|
61.7
|
3.7
|
13.2
|
16.3
|
23.8
|
—
|
(33.5)
|
(17.4)
|
(148.0)
|
(21.0)
|
64.4
|
(45.6)
|
78.5
|
Cash used for investing
activities
|
(281.8)
|
(293.2)
|
(329.9)
|
(658.0)
|
Financing activities
|
|
|
|
|
Dividends
paid
|
(89.4)
|
(67.7)
|
(325.8)
|
(271.1)
|
Distributions paid to
non-controlling interests
|
(41.8)
|
(16.4)
|
(143.0)
|
(103.5)
|
Net (repayment)
issuance of short-term borrowings
|
(263.9)
|
(6.6)
|
468.0
|
(57.2)
|
Issuance of
loans
|
55.4
|
24.5
|
267.8
|
292.3
|
Repayment of
loans
|
(34.4)
|
(89.6)
|
(222.2)
|
(371.4)
|
Issuance of long-term
debt
|
—
|
9.6
|
700.0
|
159.6
|
Repayment of
long-term debt
|
(0.1)
|
(0.1)
|
(720.1)
|
(150.4)
|
Payment of lease
liabilities (principal portion)
|
(86.9)
|
(97.4)
|
(357.2)
|
(365.3)
|
Payment of
transaction costs related to long-term debt
|
(0.6)
|
—
|
(3.7)
|
(1.0)
|
Purchase of Class A
Non-Voting Shares
|
(127.6)
|
(120.1)
|
(425.4)
|
(131.1)
|
Net receipts
(payments) on financial instruments
|
2.4
|
(4.5)
|
32.6
|
(33.7)
|
Change in
deposits
|
(118.6)
|
(198.9)
|
(932.5)
|
379.4
|
Cash used for financing
activities
|
(705.5)
|
(567.2)
|
(1,661.5)
|
(653.4)
|
Cash generated (used) in the
period
|
23.4
|
216.3
|
(1,425.4)
|
424.5
|
Cash and cash equivalents, net of bank indebtedness,
beginning
|
|
|
|
|
of period
|
302.9
|
1,535.4
|
1,751.7
|
1,327.2
|
Cash and cash equivalents, net of bank indebtedness,
end of
period
|
$
326.3
|
$
1,751.7
|
$
326.3
|
$
1,751.7
|
1
|
Certain prior year
figures have been restated to conform to the current year
presentation.
|
SOURCE CANADIAN TIRE CORPORATION, LIMITED