Lifestyles Breaking News

The Canadian Press - ONLINE EDITION

Canadian Tire posts 1.9% drop in Q4 net profit; revenue rises $1.4% to $3.78B

By: The Canadian Press

Thursday, Feb. 21, 2013 at 6:40 PM | Comments: 0

A Canadian Tire store is seen in North Vancouver on May 10, 2012. THE CANADIAN PRESS/Jonathan Hayward

TORONTO - A combination of late winter weather and an underestimation on the flurry of Christmas shopping activity left Canadian Tire posting a small increase in fourth-quarter revenue and a nearly two-per cent drop in profits.

The Toronto-based retailer said Thursday that net income in the three months ended Dec. 29 was $163.1 million or $2 per diluted share.

That was down 1.9 per cent from $166.3 million or $2.03 per diluted share in the same 2011 period.

Revenue increased one per cent to $3.16 billion from $3.12 billion.

Chief executive Stephen Wetmore blamed the weak growth on a number of factors, which also included some of its competitors moving towards Boxing Day prices earlier than usual.

"The aggressiveness of discounting happened early (in the quarter), which obviously changed the annual pattern from what we've been used to a bit," he said in a conference call.

Overall retail sales at corporate and franchise locations were up 1.4 per cent to $3.78 billion from just under $3.73 billion in the year-earlier period.

Canadian Tire, which like many Canadian retailers has been preparing for the entry of U.S. company Target this year, took restructuring charges of $19.6 million in the quarter as several executives left their roles as part of cost cuts.

The company is also looking at new ways to broaden its store concepts. It is preparing to extend its "store-within-a-store" concept, which already includes housing its Mark's clothing stores, as well as open smaller "express" locations that span a much smaller 10,000 square footage in urban areas.

Canadian Tire sells general merchandise, clothing and sporting goods as well as financial services and automotive products and services.

For the full year the company, whose retail banners include Mark's and a number of names operated through FGL Sports such as Sport Chek and Atmosphere, said net earnings were $$499.2 million or $6.10 per diluted share.

That was up 6.9 per cent from net earnings of $467 million or $5.71 per diluted share in the year-earlier period.

Annual revenue rose 10 per cent to $11.42 billion from $10.38 billion as the company reported the full-year impact of FGL results, compared with just 19 weeks in 2011.

Canadian Tire shares rose 69 cents to close at $68.91 on the Toronto Stock Exchange.

Rate this
This article has not yet been rated.

We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high. If you thought it was well written, do the same. If it doesn’t meet your standards, mark it accordingly.

You can also register and/or login to the site and join the conversation by leaving a comment.

Rate it yourself by rolling over the stars and clicking when you reach your desired rating. We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high.

Sort by: Newest to Oldest | Oldest to Newest | Most Popular 0 Comments

You can comment on most stories on brandonsun.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

There are no comments at the moment. Be the first to post a comment below.

Post Your Comment

The Brandon Sun does not necessarily endorse any of the views posted. Comments are moderated before publication. By submitting your comment, you agree to our Terms and Conditions. New to commenting? Check out our Frequently Asked Questions.