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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Canadian Tire Corp | TSX:CTC.A | Toronto | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.04 | 0.03% | 132.49 | 132.19 | 132.66 | 133.28 | 131.52 | 133.24 | 319,107 | 21:14:57 |
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.
"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
FULL YEAR HIGHLIGHTS
CONSOLIDATED OVERVIEW
FOURTH QUARTER
FULL YEAR
RETAIL SEGMENT OVERVIEW
FOURTH QUARTER
FINANCIAL SERVICES OVERVIEW
FOURTH QUARTER
CT REIT OVERVIEW
FOURTH QUARTER AND FULL-YEAR
CAPITAL ALLOCATION
CAPITAL EXPENDITURES
QUARTERLY DIVIDEND
SHARE REPURCHASES
NORMAL COURSE ISSUER BID
AUTOMATIC SECURITIES PURCHASE PLAN
(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 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 | 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 | $ |
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 Basic |
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 | (8.2) | (4.1) | 77.1 | 5.4 | ||||
Deferred cost of hedging not subject to basis adjustment | (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 | ||||||||
Actuarial gains (losses) | 41.3 | (0.7) | 41.3 | (0.7) | ||||
Net fair vale gains (losses) on hedging instruments | (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 Depreciation of property and equipment, investment property and Impairment on property and equipment, investment property and Income taxes Amortization of intangible assets (Gain) loss on disposal of property and equipment, investment Non-cash loss on exit of Helly Hansen operations in Russia Interest 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 Total additions Acquisition of short-term investments Proceeds from the maturity and disposition of short-term Proceeds on disposition of property and equipment, investment Lease payments received for finance subleases (principal portion) 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 | $ 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
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