(Toronto) The Canadian tire posted better-than-fourth-quarter profit and revenue on Thursday compared to last year.
Retailer Big Boss Greg Hicks told investors that the results were “not unusual” and that full-year performance remained strong despite the operating challenges brought by the epidemic.
For all brands, consolidated sales of stores that have been open for at least a year grew 9.5% in the fourth quarter, while online sales grew 142%, the president and CEO said.
Canadian Tire is the owner of Canadian Tire, L’Quipur, Sports Experts, Atmosphere and SportCheck brands in particular.
For at least a year at Canadian tire stores, sales grew 12.8%, and holiday-related seasonal sales rose 41% this quarter, while online sales rose 179%.
“Although the first two quarters of the year were significantly affected by the epidemic, the team had exceptional results,” Mr Hicks said, adding that the year ended with “financial and operational results. Extraordinary.”
Canadian Tire has announced the closure of 18 of its stores under the National Sports banner in southern Ontario, to reduce repetition and achieve capabilities in the company’s sporting goods offering.
The company has indicated it will try to shift affected employees to other stores in its brands family.
According to Hicks, the decision to close National Sports is part of its strategy to increase its capacity and focus on assets it deems necessary.
“It was a small store for us, for sure, but the decision to close was a concentrated one,” Hicks told investors. “There has always been a very high redundancy between this brand, the Sport Check (and the Canadian tire),” he explained.
Sport Check does not exist in Quebec, where the company’s main sports channel is replaced by sports experts.
In addition to the density of physical stores, counterfeits have also joined the e-commerce capabilities of various brands, Hicks said.
“It’s a business that has had enough capital to meet its management needs for many years, and it’s not a critical asset for us,” he said.
National Sports was launched in 1968 as the National Gym Clothing, according to its website. Stores are expected to close their doors by the end of June.
Growing profits and revenues
The Canadian tire traded at $ 488.8 million, or $ 7.97 per share, for the quarter ended Jan. 2. In comparison, the Canadian tire gained $ 334.1 million, or 42 5.42 per share, in the fourth quarter of last year.
Revenue rose to $ 4.87 billion from $ 4.32 billion a year earlier.
On an adjusted basis, the Canadian tire share gained 8.40 per cent from $ 5.53 in the same quarter a year earlier.
According to estimates collected by financial data firm Refinitive, analysts expect an average return of 69.669 per share from revenue of 4.83 billion shares.
Irene Nottel, analyst at RBC Dominion Securities, said in a note to clients that Canadian Tire’s strong fourth-quarter results “highlight the unique positions for (the company) Canadian customers”.
For the full year, Canadian Tire reported $ 14.87 billion in sales to shareholders at $ 751.8 million, or 31 12.31 per cent net income per share. By comparison, in fiscal year 2019, retailers could earn $ 778.4 million or $ 12.58 per share from revenues of $ 14.53 billion.
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