• Second quarter diluted earnings per share was $2.81, up 14.1%
• Financial Services GAAR up 6.7%
• Consolidated same store sales up 1.8%:
• 1.4% at Canadian Tire Retail
• 2.6% at FGL Sports
• 4.0% at Mark's

TORONTO, Aug. 10, 2017 /CNW/ - Canadian Tire Corporation, Limited (TSX:CTC, TSX:CTC.A) today released second quarter results for the period ended July 1, 2017.

"We delivered exceptional EPS growth exceeding 14% in Q2 for the second consecutive year," said Stephen Wetmore, President and CEO of Canadian Tire Corporation. "I am very pleased with our topline results, given the challenges posed by the slow start to the spring and summer season."

"We experienced strong sales growth in June, controlled our expenses during the quarter and had strong margin performance, which is the momentum we like to see as we go into the second half of the year," continued Mr. Wetmore. 

CONSOLIDATED OVERVIEW

• Consolidated retail sales increased $119.8 million, or 3.0%, in the second quarter. Excluding Petroleum, consolidated retail sales were up 2.5% over the same period last year.
• Consolidated revenue increased $61.3 million, or 1.8%, which includes a $27.3 million increase in Petroleum revenue resulting from higher per litre gas prices. Excluding Petroleum, consolidated revenue increased $34.0 million, or 1.2%, in the quarter.
• Diluted EPS was $2.81 in the quarter, an increase of $0.35 per share, or 14.1%, over the second quarter of 2016.

RETAIL OVERVIEW

• Retail segment revenue increased $48.0 million or 1.6% in the second quarter compared to last year. Excluding Petroleum, retail segment revenue increased 0.8% in the quarter.
• Retail margin rate excluding Petroleum increased 83 bps.
• Income before income taxes increased $10.5 million, or 6.1% over the second quarter of 2016.
• Canadian Tire Retail saw retail sales increase 2.2% and same store sales were up 1.4% compared to the prior year.
• FGL Sports' retail sales were up 3.7% and same store sales were up 2.6% in the second quarter of 2017. Same store sales at Sport Chek were up 1.1%.
• Mark's retail sales grew 4.7% and same store sales increased 4.0% compared to the same period last year.

CT REIT OVERVIEW

• As disclosed in the Q2 2017 CT REIT earnings release on August 2, 2017, CT REIT announced four investments in its quarterly results at an estimated cost of $53 million.

FINANCIAL SERVICES OVERVIEW

• Income before income taxes increased 12.3% in the second quarter to $101.2 million.
• In Q2 2017, gross average credit card receivables (GAAR) was up 6.7% over the prior year.

CAPITAL EXPENDITURES

• Operating capital expenditures were $70.7 million in the quarter, down from $126.7 million in the second quarter of 2016.
• As previously announced, for fiscal 2017, the Company expects annual operating capital expenditures to be within the range of $400 million to $425 million.

QUARTERLY DIVIDEND

• The Company has declared dividends payable to holders of Class A Non-Voting Shares and Common Shares at a rate of $0.65 per share payable on December 1, 2017 to shareholders of record as of October 31, 2017. The dividend is considered an "eligible dividend" for tax purposes.

SHARE REPURCHASE

• On November 10, 2016, the Company announced its intention to repurchase $550.0 million of its Class A Non-Voting Shares, in excess of the amount required for anti-dilutive purposes, by the end of 2017. As at July 1, 2017 the Company had repurchased $337.3 million, leaving $212.7 million that is expected to be repurchased during the remainder of fiscal 2017.

To view a PDF version of Canadian Tire Corporation's full quarterly earnings report please see: http://files.newswire.ca/116/CTC_Q2_2017_MDA_FS.pdf

FORWARD-LOOKING STATEMENTS

This press release 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 anticipated financial position, results of operations and operating environment. Readers are cautioned that such information may not be appropriate for other purposes.

Certain statements other than statements of historical facts included in this press release may constitute forward-looking information, including but not limited to, statements concerning the Company's expectations with respect to its operating capital expenditures under the heading "Capital Expenditures" and 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 2017 under the heading "Share Repurchase".

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 press release 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 2016 and to sections 7.2.4 (Retail segment business risks), 7.3.2 (CT REIT segment business risks), 7.4.3 (Financial Services segment business risks) and 12.0 (Enterprise Risk Management) and all subsections thereunder of our Management's Discussion and Analysis for fiscal 2016, as well as the Company's other public filings, available at www.sedar.com and at www.corp.canadiantire.ca.

The forward-looking statements and information contained herein are based on certain factors and assumptions as of the date hereof and 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. 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 10, 2017. 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 approximately 1,700 retail and gasoline outlets are supported and strengthened by our Financial Services division and the tens of thousands of people employed across the country by the Company and its local dealers, franchisees and petroleum retailers. For more information, visit Corp.CanadianTire.ca.

SOURCE CANADIAN TIRE CORPORATION, LIMITED