Canadian Tire Corporation, Limited · TSX:CTC
Canadian Tire — Q3 2011 Earnings Presentation
24 slides from Canadian Tire's earnings presentation, Nov 10, 2011
Slide 1: Canadian Tire Corporation Investor Presentation November 2011
Canadian Tire Corporation Investor presentation November 2011
Slide 2: Forward looking information
Forward looking information In this document, the terms “we”, “us”, “our”, “Company” and “CTC” refer to Canadian Tire Corporation, Limited and its business units and subsidiaries. This document contains forward-looking information that reflects management’s current expectations related to matters su
Slide 3: Canadian Tire in brief
Canadian Tire in brief Uniquebusinessmix Unique business mix Reachandscale Reach and scale Continuousinnovation Continuous innovation Strongfinancialposition Strong financial position • Diverse product mix • More than 1,700 retail • Focus on new products, • Solid free cash flow • Strong in-house bra
Slide 4: Our core business is retail
Our core business is retail We have six key Customer business categories Preparing Canadians for the Jobs & Joys of Everyday Living in Canada Sales in 20101 $9.3B2 $1.6B3 $1.0B $1.0B4 Business Financial categories Auto Living Fixing Playing Apparel Services Gas Home cleaning Home repair Hock
Slide 5: Our business model
Our business model Customer Preparing Canadians for the Jobs & Joys of Everyday Living in Canada Businesses Leadership Michael Paul Dean CEO: Stephen Wetmore Glenn Butt Mike Arnett CFO: Marco Marrone Medline Wilson McCann Customer Marketing Merchandising Marketing experience Store operations Shared
Slide 6: Our retail network across Canada
Our retail network across Canada 4 CTR distribution centres 2 Mark’s distribution centres At least one 2 transload facilities 3 auto parts distribution centres 1FGLS 1 FGL Sports t di distribution t ib ti centre t Canadian C di Ti Tire store is within 15 minutes of 90% of Canadians West Ontario Queb
Slide 7: Strategic objectives
Strategic objectives 1. Grow our business 2. Improve the customer experience 3. Improve p our pperformance 4. Retain our strong financial position 5 Meet or exceed our five year financial aspirations 5. Att Canadian Ca ad a Tire e we’re e e focused on g ocused o growth o t , productivity and the cus
Slide 8: Grow our business
Grow our business Multiple engines of growth drive the business > > > > > Strengthen our core retail business – Living, Living Fixing and Playing • Retain and grow market Reclaim our status as Canada’s Automotive authority • Update IT infrastructure Become Canada’s authority in Sports • Acquisitio
Slide 9: Enhance the customer experience
Enhance the customer experience Deliver high quality, consistent customer service across our network > > > > Store renewal program • Smart stores • Mark’s name refresh Improved store operations support • Expanded field operations support Online – expanded convenience • Tires online fall of 2011 CC
Slide 10: Improve our performance
Improve our performance Building a more efficient business > One integrated retail network supported pp shared services • A shared-services business model byy > > > Less capital intensive store renewal investment • Focus on productivity and the customer Productivity improvements p • Merchandise Ma
Slide 11: Retain our strong financial position
Retain our strong financial position Deliver sustainable growth A prudent approach > > > > Grow sales and earnings Manage margins and expense levels Manage debt levels Drive attractive shareholder returns 10 10
Slide 12: Meet or exceed our financial aspirations
Meet or exceed our financial aspirations 10 to 12 p per cent total return to our shareholders Five year financial aspirations 2010 CTR retail sales growth 3 to 5% 1.4% Total return to our Consolidated EPS 8 to 10% 18.5% shareholders in Retail ROIC 10% + 8.0% 2010 FS return on receivables 4.5 to 5%
Slide 13: In summary: next phase of our journey
Proud to be the store for Canadians And it’s jjust the beginning of the next phase of our journey In summary > Strengths • Unique business mix • Reach and scale • Continuous innovation > Targeted strategy • Growth • Customer service • Performance > Financial aspirations • CTR Retail sales growth: 3
Slide 14: Consolidated highlights Q3 2011 – Year to date
Consolidated highlights Q3 2011 – Year to date Change vs. ($ in millions except per share amounts) Q3 2011 YTD Q3 2010 YTD 2010 Revenue $ 7,252.0 9.5% $ 9,213.1 Net income after tax $ 300 7 300.7 9 4% 9.4% $ 444 2 444.2 Basic earnings per share $ 3.69 9.6% $ 5.45 Diluted earnings per share $ 3.68 9.
Slide 15: Retail segment highlights
Retail segment highlights Q3 2011 – Year to date ($ in millions) Q3 2011 YTD Q3 2010 YTD Change Retail Sales CTR retail sales growth 1.7% 1.8% Mark's retail sales growth 3.0% 4.9% Gas (Petroleum) retail sales growth 22.2% 9.4% 1 FGL Sports retail sales growth 6.6% n/a Revenue $ 6,488.6 $ 5,853.0 10.
Slide 16: Financial services segment highlights
Financial services segment highlights Q3 2011 – Year to date ($ in millions) Q3 2011 YTD Q3 2010 YTD Change Revenue $ 711 7 711.7 $ 715 9 715.9 (0 6%) (0.6%) Operating expenses (excluding D&A) 189.6 195.8 (3.3%) Net finance costs 46.1 49.0 (5.9%) Income before income taxes $ 163.4 $ 159.3 2.6% EBITD
Slide 17: Additional information
Canadian Tire Corporation Additional information
Slide 18: Grow our business – CTR
Grow our business – CTR Strengthen our core Retail business – g Fixing Living, g and Playing > Retain and grow market leading positions • Expanded assortment in high growth categories > Introduce new categories and services • Major appliances – launched in Q3 2011 > Build credibility and relevance i
Slide 19: Grow our business – Automotive
Grow our business – Automotive Canada’s authority in Automotive > Update IT infrastructure • Automotive Management System rollout under the Automotive Infrastructure > Optimize product assortment • Regionalized assortment to meet customers’ immediate needs > Increase staff knowledge • Instructor led
Slide 20: Grow our business – Sports
Grow our business – Sports Become Canada’s ultimate authority in Sports p > The Forzani Group acquisition in August 2011 • Strengthen St th a core b business i • Platform for growth and diversification category t > Near-term priorities • Maintain revenue momentum • Deliver acquisition synergies • Re
Slide 21: Grow our business – Apparel
Grow our business – Apparel Retain and grow market leading positions in Apparel (Mark’s) > Expand customer base • Grow men’s and women’s casual wear • Focus on basics while striving to be fashion correct > Expand channels • Grow wholesale-direct Imagewear division • Online sales > Continuous innovat
Slide 22: Grow our business – Services
Grow our business – Services Grow the Financial Services business pp the core to support > Return to pre-recession return on receivables • Account pricing and terms management • Targeting key customers for > Cross promotions with CTR • Broaden in-store financing offers > Pursue new product and servi
Slide 23: Financial flexibility
Financial flexibility Financing source Amount Description Committed bank lines of credit $1.37 billion • Provided by seven domestic ($1,120 million) and three international ($250 million) financial institutions • For general corporate purposes and support for both the corporate and Glacier Credit Ca
Slide 24: For more information
For more information www.corp.canadiantire.ca/EN/investors p / / angela.mcmonagle@cantire.com (416) 480-8225