FGL Sports Q3 Comps Jump 7 percent

Canadian Tire Corp. reported same-store sales at FGL Sports, which operates more than 30 Atmosphere specialty outdoor stores, grew 7
percent in the third quarter. Comparable store sales at its Sport Chek chain grew 8.5 percent.

“Our
first priority is to put the numbers on the board and we certainly
achieved that this quarter. Our solid top and bottom line performance
demonstrates the strength of the company's operations and retail
fundamentals, especially at our core Canadian Tire stores,” said Michael
Medline, President and CEO, Canadian Tire Corporation.

CONSOLIDATED OVERVIEW

•    
  Consolidated revenue increased $133.2 million, or 5.3 percent,
  excluding Petroleum. Consolidated revenue increased 1.9 percent or $56.9
  million versus the prior year, and reflects the impact of lower
  year-over-year gas prices at Petroleum.
•     Gross average credit card receivables grew 1.7 percent over the same period last year.
•    
  Diluted EPS was $2.62, up 20.5 percent, buoyed by a real estate gain
  that contributed $0.33 per share and despite an $0.18 reduction due to
  the Financial Services transaction in 2014.

RETAIL OVERVIEW

•    
  Retail segment revenue increased 5.9 percent over the same period last
  year, excluding Petroleum, primarily due to higher shipments to Dealers
  at Canadian Tire and retail sales at Canadian Tire, FGL Sports and
  Mark's. Retail segment revenue, including Petroleum, was up 2 percent in
  the quarter, reflecting lower year-over-year gas prices.
•    
  Income before income taxes in the Retail segment was $182.2 million, up
  39.3 percent over the third quarter last year. Excluding the gain on a
  real estate transaction, income before income taxes was $153 million, up
  17 percent over the prior year.
•     Canadian Tire's sales increased 1.5 percent, while same store sales were up 3.4 percent over the same period last year.
•    
  FGL Sports' sales and same store sales grew 6.5 percent and 7 percent
  respectively, over the same period last year. Same store sales at Sport
  Chek were up 8.5 percent in the third quarter reflecting recent
  investment and network expansion.
•     Mark's sales grew 2.7 percent and same store sales were down 0.2 percent over the prior year.

CT REIT OVERVIEW

•    
  As disclosed in the Q3 2015 CT REIT release, issued November 9, 2015,
  the trustees of CT REIT approved an increase in the rate of monthly
  distributions beginning January 2016, representing a 2.56 percent
  increase and a new annualized rate of $0.68.

FINANCIAL SERVICES OVERVIEW

•     Financial Services posted third quarter gross average credit card receivables growth of 1.7 percent.
•     Income before income taxes was down 2.8 percent to $95.6 million.

CAPITAL EXPENDITURES

•    
  Capital expenditures were $226.4 million in the third quarter, down
  $63.9 million over the prior year. The decline in capital expenditures
  is primarily due to lower year-over-year CT REIT third party
  acquisitions; partially offset by increased spending on distribution
  capacity relating to the Bolton DC, as well as increased capital
  spending on IT initiatives including the company's digital strategy.

CAPITAL EXPENDITURE GUIDANCE UPDATE

•    
  As previously disclosed, the company expects its three-year average
  annual operating capital expenditures between fiscal 2015 and 2017 to be
  between $600 million and $625 million.
•     Operating capital
  expenditures in 2015 are expected to be within a range of $600 million
  to $625 million, primarily due to increased spending on the retail
  network expansion, including the FGL Sports growth strategy, and
  significant investments in digital and technology initiatives.
•    
  The company previously announced that it expected capital for
  additional distribution capacity to be in the range of $175 million to
  $200 million in 2015. The company now expects these capital expenditures
  to fall below the lower end of the range due to a shift in the timing
  of spend to 2016.

SHARE REPURCHASE

•     On
  October 9, 2014, the company announced that it intended to repurchase
  $400 million of its Class A Non-Voting Shares in excess of the amount
  required for anti-dilutive purposes by the end of 2015. As at October 3,
  2015, the company had completed its full repurchase commitment.
•    
  The company has announced its intention to repurchase a further $550
  million of its Class A Non-Voting Shares in excess of the amount
  required for anti-dilutive purposes by the end of 2016, subject to
  regulatory approval.