Canadian Tire Announces Third Quarter 2012 Results


    --  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                                        YTD Q3        YTD Q3
except per      Q3 2012     Q3 2011             2012           2011    
share
amounts)                               Change                           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                                           YTD Q3
except per      Q3 2012     Q3 2011                 2012    
share                                                           YTD Q3
amounts)                                Change                    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           Q3 2012     Q3 2011             YTD Q3         YTD Q3  
millions)                              Change    2012             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                           Change
stores
and gas                                         YTD Q3      YTD Q3
bars)         Q3 2012     Q3 2011                 2012        2011   Change

CTR
retail                               
sales
growth(1)        0.3%        3.2%                 1.4%        1.8%         

CTR same
store                                
sales
growth(1)      (0.2)%        2.3%                 0.9%        0.8%         

CTR
revenue                             (6.7)%
(3)         $ 1,395.4   $ 1,496.1            $ 4,231.5   $ 4,197.9     0.8%

Number of
CTR                                  
stores(2)         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                                  1.7%
Petroleum
revenue     $   543.4   $   534.5            $ 1,539.8   $ 1,490.3     3.3%

Canadian
Tire
Petroleum                             3.3%
gross
margin      $    39.8   $    38.6            $   109.8   $   110.8   (0.8)%

Number of                            
gas bars          293         291                  293         291         
                                                                           

FGL
Sports
retail                               
sales
growth(4)        4.2%        6.6%                 4.7%         n/a         

FGL
Sports
same                                 
store
sales
growth(4)        4.4%        7.3%                 5.8%         n/a         

FGL
Sports                               95.5%
revenue     $   429.1   $   219.5            $ 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                                1.5%
revenue     $   200.2   $   197.3            $   614.1   $   591.5     3.8%

Number of
Mark's                               
stores(2)         387         385                  387         385         
                                                                    


                                                                             

Financial                                                           
Services
segment                                                               
financial
results                                                                      

(C$ in         Q3 2012     Q3 2011                YTD Q3      YTD Q3
millions)                             Change        2012        2011   Change

Total gross                                                  4,026.7
average       $           $                                           
receivables     4,116.1     4,061.1     1.4%   $ 4,058.2   $             0.8%

Revenue           249.7       245.0     2.0%       733.9       716.9     2.4%

Gross                                                          359.8  
margin            137.9       129.2     6.9%       404.2                12.4%

Operating                                                      197.6  
expenses           64.7        65.4   (0.8)%       192.2               (2.7)%

Income                                                         163.4
before                                                                
income
taxes              73.7        64.2    14.8%       215.2                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.







Media: Amy Cole, 416-544-7655,amy.cole@cantire.com Investors: Angela 
McMonagle, 416-480-8225,angela.mcmonagle@cantire.com

PDF available at:  
http://stream1.newswire.ca/media/2012/11/08/20121108_C6120_DOC_EN_20331.pdf

SOURCE: CANADIAN TIRE CORPORATION, LIMITED

To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/November2012/08/c6120.html

CO: CANADIAN TIRE CORPORATION, LIMITED - INVESTOR RELATIONS
ST: Ontario
NI: RET ERN CONF 

-0- Nov/08/2012 13:30 GMT


 
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