Download Canadian Tire Corporation Delivers Strong Q2 Results

Canadian Tire Corporation Delivers Strong Q2 Results

Same store sales up in all core retail banners:
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2.9% at Canadian Tire Retail
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7.2% at Sport Chek
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4.6% at Mark’s
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Second quarter diluted earnings per share was $2.46, up 14.5%
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Retail EBITDA increased by 11.2%
TORONTO, August 4, 2016 – Canadian Tire Corporation, Limited (TSX:CTC, TSX:CTC.A) today
released second quarter results for the period ended July 2, 2016.
"I am pleased to see strong second quarter results across all retail banners and our teams continue
to execute well as we head into the second half of the year," said Stephen Wetmore, President and
CEO, Canadian Tire Corporation. "Building on the Company's current initiatives , the collective
strength of our brands, coupled with our leadership in and commitment to product innovation today,
and for tomorrow, represent an incredible opportunity for growth," continued Wetmore.
CONSOLIDATED OVERVIEW

Consolidated retail sales increased $121.1 million, or 3.1% in the second quarter including a
5.3% decline in Petroleum retail sales due to lower gas prices. Excluding Petroleum,
consolidated retail sales were up 4.5% over the same period last year.
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Excluding Petroleum, consolidated revenue increased $126.0 million, or 4.5% in the quarter,
primarily due to higher shipments at Canadian Tire and increased sales at FGL Sports and
Mark’s. Consolidated revenue increased 2.9% over the same period last year.

Diluted EPS was $2.46 in the quarter, an increase of $0.31 per share, or 14.5%, over the
second quarter of 2015.
RETAIL OVERVIEW

Retail segment revenue increased 4.8% excluding Petroleum in the quarter. Retail segment
revenue increased 3.0% in Q2 compared to last year.

Retail gross margin rate, excluding Petroleum, increased 55 basis points.
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Income before income taxes in the Retail segment was $173.1 million, up $20.3 million, or
13.3% in the second quarter of 2016, over 2015.

Canadian Tire Retail saw retail sales increase 4.2% and same store sales up 2.9% in the
quarter over Q2 2015.

FGL Sports’ retail sales were up 5.7% and same store sales were up 5.8% in the second
quarter of 2016. Same store sales at Sport Chek increased 7.2%.

Mark’s retail sales grew 4.4% and same store sales increased 4.6% compared to Q2 2015.
CT REIT OVERVIEW

As disclosed in the Q2 2016 CT REIT release issued August 2, 2016, CT REIT announced
five additional investments, including two developments and three property intensifications
for a total investment of $24.0 million.

Additionally, during the second quarter, CT REIT completed the acquisition from Canadian
Tire Corporation of the previously announced sale and leaseback transaction involving the
new 1,400,000 square foot Canadian Tire distribution centre in Bolt on, ON. Construction is
expected to be completed in Q4 2016 with rent to commence in Q1 2017.
FINANCIAL SERVICES OVERVIEW

Income before income taxes decreased 7.9% in the second quarter to $90.1 million.

In Q2 2016, GAAR increased 0.5% over the prior year.

Financial Services continues to invest in the acquisition of new accounts through traditional
marketing and in-store financing programs to drive GAAR growth and sales at Canadian Tire
Retail.
CAPITAL EXPENDITURES

Operating capital expenditures were $126.7 million in the second quarter, up from $112.4 in
the prior year.

Capital expenditures for CT REIT were $116.9 million, up $102.8 million in the second
quarter, largely due to the acquisition of the Sears distribution centre in Calgary, AB.

As previously disclosed in Q3 2015, operating capital expenditures for 2016 are expected to
be in the range of $625.0 million and $650.0 million reflecting increased investments in the
retail network expansion and continued investments in digital and technology initiatives.

Distribution capacity capital expenditures for 2016 are expected to be in the range of $150.0
million to $175.0 million.
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QUARTERLY DIVIDEND

The Company has declared dividends payable to holders of Class A Non-Voting Shares and
Common Shares at a rate of $0.575 per share payable on December 1, 2016 to
shareholders of record as of October 31, 2016. The dividend is considered an “eligible
dividend” for tax purposes.
SHARE REPURCHASE

On November 12, 2015, the Company announced its intention to repurchase a further
$550.0 million of its Class A Non-Voting Shares, in excess of the amount required for antidilutive purposes, by the end of 2016. As at July 2, 2016, the Company had repurchased
$330.0 million, leaving $220.0 million to be repurchased in fiscal 2016.
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. Forwardlooking 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 anticipated
financial position, results of operations and operating environment. Readers are cautioned that such
information may not be appropriate for other purposes.
All statements other than statements of historical facts included in this document may constitute forwardlooking information, including but not limited to, statements concerning the Company’s expectations with
respect to its investments in its Financial Services business under the heading “Financial Services
Overview”, the Company’s expectations with respect to its operating capital expenditures and distribution
capacity capital expenditures for 2016 under the heading “Capital Expenditures”, the Company’s intention
to repurchase Class A Non-Voting Shares in excess of the amount required for anti-dilutive purposes by
the end of 2016 under the heading “Share Repurchase”, and other 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.
Forward-looking information is based on the reasonable assumptions, estimates, analyses, beliefs 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 information is provided.
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 , estimates,
analyses, beliefs and opinions 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, assumptions and beliefs which are current, reasonable and complete, this
information is necessarily subject to a number of factors, risks and uncertainties that could cause actual
results to differ materially from management's expectations and plans as set forth in 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, refer to section 2.10 (Risk Factors) of our Annual Information
Form for fiscal 2015 and to sections 7.2.4 (Retail segment business risks), 7.3.3 (CT REIT segment
business risks), 7.4.3 (Financial Services segment business risks) and 12.0 (Enterprise Risk
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Management) and all subsections thereunder of our 2015 Management's Discussion and Analysis, as
well as the Company’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, acquisit ions,
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, 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 1:00 p.m. ET on August 4, 2016. The conference call will be available
simultaneously and in its entirety to all interested investors and the news media through a webcast
at http://corp.canadiantire.ca/EN/investors, 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 family of businesses
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 categories. 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, and FGL Sports (Sport Chek, Hockey Experts, Sports Experts,
National Sports, Intersport, Pro Hockey Life and Atmosphere), which offers the best active wear
brands. The 1,700 retail and gasoline outlets are supported and strengthened by our Financial
Services division and the tens of thousands of people employed acros s the Company. For more
information, visit Corp.CanadianTire.ca.
FOR MORE INFORMATION
Media: Jane Shaw, 416-480-8581, [email protected]
Investors: Lisa Greatrix, 416-480-8725, [email protected]
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