*DJ Couche-Tard 1Q Net $764.4M >ATD.B.T

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August 31, 2021 16:55 ET (20:55 GMT)

Press Release: Alimentation Couche-Tard Announces its Results for its First Quarter of Fiscal Year 2022

Alimentation Couche-Tard Announces its Results for its First Quarter of Fiscal Year 2022

Canada NewsWire

LAVAL, QC, Aug. 31, 2021

-- Net earnings were $764.4 million, or $0.71 per diluted share for the first quarter of fiscal 2022 compared with $777.1 million, or $0.70 per diluted share for the first quarter of fiscal 2021. Adjusted net earnings1 were approximately $758.0 million compared with $795.0 million for the first quarter of fiscal 2021. Adjusted diluted net earnings per share1 were $0.71, unchanged compared with the corresponding quarter of last year. -- As we compare against a quarter fully impacted by the COVID-19 pandemic, results varied by region as the pandemic and social restrictive measures were at different levels year-over-year. Merchandise categories most impacted by COVID-19, such as food, continue to show a positive trend and, on a 2-year basis, convenience activities performed well in our global network. Fuel margins continue to be higher than pre-pandemic levels, while fuel volumes continue to be challenged by work from home trends and changes in local restrictions. -- Total merchandise and service revenues of $4.1 billion, an increase of 5.4%. Same-store merchandise revenues decreased 0.2% in the United States and 9.6% in Canada, and increased 5.9% in Europe and other regions. On a 2-year basis, same-store merchandise revenues increased at a compound annual growth rate of 3.7% in the United States, 4.9% in Europe, and 4.2% in Canada. -- Merchandise and service gross margin decreased 0.1% in the United States to 34.2%, and 2.2% in Europe and other regions to 38.4%, which was impacted by the integration of Circle K Hong Kong. Gross margin in Canada increased 1.2% to 32.3%, due to favorable changes in product mix. -- Same-store road transportation fuel volume increased 11.8% in the United States, 6.3% in Europe and other regions, and 10.4% in Canada, due to higher fuel demand compared to the corresponding quarter. On a 2-year basis, same-store road transportation fuel volume decreased at a compound annual growth rate of 6.1% in the United States, 3.3% in Europe, and 9.4% in Canada, still impacted by work from home trends. -- Road transportation fuel gross margin of 36.75c per gallon in the United States, a decrease of 4.55c per gallon, and US 10.32c per liter in Europe and other regions, a decrease of US 0.19c per liter, due to the unusually high fuel margins of the comparable quarter. In Canada, it increased by CA 0.67c per liter to CA 10.92c per liter. Fuel margins remained healthy, driven by favorable market conditions, procurement initiatives and fuel rebranding. -- Looking at gross profit1 on a 2-year basis provides additional insight given the volatility in the various key measures of our business. Excluding the impact of CAPL and Circle K Hong Kong, merchandise and service, as well as road transportation fuel gross profit, are higher by 10.9% and 19.4%, respectively, compared with the pre-pandemic first quarter of fiscal 2020. -- Successful issuance of $1.0 billion of US-dollar-denominated senior unsecured notes, including an inaugural tranche of Green Bonds totaling $350.0 million. -- The Corporation implemented a share repurchase program which allows it to repurchase up to 4.0% of the public float of its Class B subordinate voting shares. Under this program, shares for an amount of $299.2 million were repurchased.

LAVAL, QC, Aug. 31, 2021 /CNW Telbec/ - For its first quarter ended July 18, 2021, Alimentation Couche-Tard Inc. ("Couche-Tard" or the "Corporation") (TSX: ATD.A) (TSX: ATD.B) announces net earnings of $764.4 million, representing $0.71 per share on a diluted basis. The results for the first quarter of fiscal 2022 were affected by a pre-tax net foreign exchange gain of $8.6 million, as well as pre-tax acquisition costs of $0.8 million. The results for the comparable quarter of fiscal 2021 were affected by a pre-tax net foreign exchange loss of $18.4 million, as well as pre-tax acquisition costs of $3.9 million. Excluding these items, the adjusted net earnings(1) were approximately $758.0 million for the first quarter of fiscal 2022, compared with $795.0 million for the first quarter of fiscal 2021, a decrease of $37.0 million, or 4.7%, driven by lower road transportation fuel margins in the United States and higher operating expenses, partly offset by higher fuel demand and the net positive impact from the translation of its Canadian and European operations into US dollars. The adjusted diluted net earnings per share(1) stood at $0.71, stable compared with the corresponding quarter of fiscal 2021. All financial information presented is in US dollars unless stated otherwise.

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(1) Please refer to the section "Non-IFRS Measures" for additional information on performance measures not defined by IFRS

"I am pleased to report that across our global network, we had solid first quarter results, both in convenience and fuel, even when compared to a very strong quarter last year. Same-store sales were especially good in Europe, and across all our regions, we have seen positive growth in food as the ease and the quality of our offer are clearly resonating with our customers. While remaining impacted by COVID-19 traffic patterns, fuel volumes improved and we continued to achieve healthy margins as well as expanded our global fuel business in terms of procurement capabilities, pricing analytics, and the Circle K fuel rebranding efforts, where results continued to be encouraging. No doubt, as the pandemic continues to present operational and supply chain challenges to the business, I remain incredibly proud and grateful for the care and commitment to the business shown by our team members, customers, and partners", said Brian Hannasch, President and Chief Executive Officer of Alimentation Couche--Tard.

"This quarter, we made notable developments in our ambition to grow the network. On the acquisition front, we entered into a definitive agreement to purchase Wilsons Gas Stops and Go! Stores that has a network of 226 company-operated and dealer locations and a fuel terminal in Atlantic Canada. We also are moving forward with a binding agreement to acquire 35 sites in the United States, predominately in Oregon and Washington, currently operated under the Porter's brand. In both cases, we look forward to welcoming strong sites with experienced team members into the Couche-Tard family. On the organic front, we added 30 new store builds or razed and rebuilds to our portfolio, which support our growth platforms and brand promise. Additionally, we expanded our Fresh Food, Fast program globally, adding nearly 500 stores, which brings the total count to over 2,000 stores. Growing the size and scale of the network is essential to our strategic goals and we remain disciplined in creating value for our shareholders", concluded Brian Hannasch.

Claude Tessier, Chief Financial Officer, added: "In light of a strong quarter last year, we delivered solid quarterly results for the first quarter of fiscal 2022. We saw good performance across most areas of the organization, especially when looking at the results across the past two years. On the operating cost side, we implemented important measures in the prior year to control our expenses with the uncertainties around the COVID-19 pandemic. We therefore saw an increase in our expenses this quarter also due to normal inflation, a somewhat volatile labor market and investment in strategic initiatives. For the 2-year period, our normalized expenses grew at a compound annual growth rate of only 1.2%, continuing to reflect our cost discipline. We exited the quarter in a strong financial position with a cash balance of approximately $3.4 billion and a leverage ratio of 1.23. In addition, we repurchased close to $300.0 million of our shares during the quarter, continuing to provide value to our shareholders."

Significant Items of the First Quarter of Fiscal 2022

-- As we compare against a quarter fully impacted by the COVID-19 pandemic, results varied by region as the pandemic and social restrictive measures were at different levels year-over-year. Merchandise categories most impacted by COVID-19, such as food, continue to show a positive trend and, on a 2-year basis, convenience activities performed well in our global network. Fuel margins continue to be higher than pre-pandemic levels, while fuel volumes continue to be challenged by work from home trends and changes in local restrictions. Looking at gross profit1 on a 2-year basis provides additional insight given the volatility in the various key measures of our business. Excluding the impact of CAPL and Circle K Hong Kong, merchandise and service, as well as road transportation fuel gross profit, are higher by 10.9% and 19.4%, respectively, compared with the pre-pandemic first quarter of fiscal 2020. -- We exercised common share warrants in Fire & Flower Holdings Corp. ("Fire & Flower") for cash consideration of CA $9.8 million ($7.9 million), which increased our ownership interests to approximately 22.4%. -- On April 21, 2021, the Toronto Stock Exchange approved the implementation of a share repurchase program, which took effect on April 26, 2021. The program allows us to repurchase up to 4.0% of the public float of our Class B subordinate voting shares. During the first quarter of fiscal 2022, we repurchased 8,471,000 Class B subordinate voting shares, for an amount of $299.2 million. -- On May 13, 2021, we issued US-dollar-denominated senior unsecured notes

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August 31, 2021 16:55 ET (20:55 GMT)