ALIMENTATION COUCHE-TARD ANNOUNCES ITS RESULTS FOR ITS THIRD QUARTER OF FISCAL YEAR 2025
ALIMENTATION COUCHE-TARD ANNOUNCES ITS RESULTS FOR ITS THIRD QUARTER OF FISCAL YEAR 2025 |
| [18-March-2025] |
LAVAL, QC, March 18, 2025 /PRNewswire/ - Alimentation Couche-Tard Inc. ("Couche-Tard" or the "Corporation") (TSX: ATD) announces its results for its third quarter ended February 2, 2025.
Executive Comments on the Quarter Alex Miller, President and Chief Executive Officer, said: "We are pleased to report positive improvements in the business this quarter. While consumers continue to be cautious in their spending, we are seeing encouraging signs of resilience. Same-store sales were positive in both Canada and Europe compared to the same quarter last year, and we had sequential improvement in the United States, impacted by historic winter storms in our southern business units. Food continued to grow in the United States as our meal deal promotions performed well and have been extended to Canada. In our fuel business, we are maintaining market share in the United States and margins aligned with recent quarters. As inflationary pressure persists, our number one priority is winning our customers by being ready with the products and services they want at compelling value." Filipe Da Silva, Chief Financial Officer, added: "We delivered notable progress this quarter, delivering our most improved performance in over a year as we continue to navigate challenging consumer trends, particularly in the United States. Our results reflect a balanced mix of organic growth and acquisitions, demonstrating the strength of our globally diversified network, the success of our integration activities and our commitment to drive long-term sustainable growth. This quarter also marks the one-year anniversary of the acquisition of certain assets from TotalEnergies, which is on track for synergy realization and continues to deliver solid results thanks to the dedicated efforts of all of our team members." Quarterly Highlights
Summary of the Third Quarter of Fiscal 2025 For its third quarter ended February 2, 2025, Couche-Tard reported net earnings attributable to shareholders of the Corporation of $641.4 million, representing $0.68 per share on a diluted basis, compared with $623.4 million for the corresponding quarter of fiscal 2024, representing $0.65 per share on a diluted basis. The results for the third quarter of fiscal 2025 were affected by a pre-tax net foreign exchange gain of $12.3 million and by pre-tax acquisition costs of $8.7 million. The results for the comparable quarter of fiscal 2024 were affected by pre-tax acquisition costs of $5.6 million and by a pre-tax net foreign exchange gain of $5.4 million. Excluding these items, the adjusted net earnings attributable to shareholders of the Corporation1 were approximately $641.0 million, or $0.68 per share on a diluted basis for the third quarter of fiscal 2025, compared with $625.0 million, or $0.65 per share on a diluted basis for the corresponding quarter of fiscal 2024, an increase of 4.6% in the adjusted diluted net earnings per share1. This increase is primarily driven by higher road transportation fuel gross margin1, the contribution from acquisitions, the organic growth in our convenience operations, as well as the favorable impact of the share repurchase program, partly offset by the impact of strategic investments on operating expenses and depreciation. All financial information presented is in US dollars unless stated otherwise.
Significant Items of the Third Quarter of Fiscal 2025
Other Changes in our Network during the Third Quarter of Fiscal 2025
Summary of changes in our store network The following table presents certain information regarding changes in our store network over the 16‑week period ended February 2, 2025(1):
Exchange Rate Data We use the US dollar as our reporting currency, which provides more relevant information given the predominance of our operations in the United States. The following table sets forth information about exchange rates based upon closing rates expressed as US dollars per comparative currency unit:
For the analysis of consolidated results, the impact of the translation of our foreign currency operations into US dollars is defined as the impact from the translation of our Canadian, European, Asian, and corporate operations into US dollars. Variances of our foreign currency operations into US dollars are determined as being the difference between the corresponding period results in local currencies translated at the current period average exchange rate and the corresponding period results in local currencies translated at the corresponding period average exchange rate. Summary Analysis of Consolidated Results for the Third Quarter and First Three Quarters of Fiscal 2025 The following table highlights certain information regarding our operations for the 16 and 40-week periods ended February 2, 2025, and February 4, 2024, and the results analysis in this section should be read in conjunction with this table. The results from our operations in Europe and Asia are presented together as Europe and other regions.
Revenues Our revenues were $20.9 billion for the third quarter of fiscal 2025, up by $1.3 billion, an increase of 6.5% compared with the corresponding quarter of fiscal 2024, mainly attributable to the contribution from acquisitions and higher revenues in our wholesale fuel business, partly offset by a lower average road transportation fuel selling price, softness in fuel demand and traffic impacted by unusual winter conditions in the United States, as well as the net negative impact of approximately $212.0 million from the transaction of our foreign currency operations into US dollars. For the first three quarters of fiscal 2025, our revenues increased by $4.9 billion, or 9.5%, compared with the corresponding period of fiscal 2024, mainly attributable to similar factors as those of the third quarter. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $204.0 million on our revenues. Merchandise and service revenues Total merchandise and service revenues for the third quarter of fiscal 2025 were $5.3 billion, an increase of $253.0 million compared with the corresponding quarter of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $42.0 million. The remaining increase of approximately $295.0 million, or 5.9%, is primarily attributable to the contribution from acquisitions, which amounted to approximately $248.0 million, and organic growth. Same-store merchandise revenues decreased by 0.1% in the United States as many regions were impacted by unusual winter conditions, and customers remain prudent in their spending. Same-store merchandise revenues increased by 0.2% in Europe and other regions1, supported by cigarettes sales in Netherlands as new legislations were favorable to our industry, partly offset by the continued struggle of this category in Asia related to tax increases. In Canada, same-store merchandise revenues increased by 2.8%, driven by a strong growth of the alcohol category, partly offset by a decrease in other nicotine products revenues, both also impacted by new legislations. For the first three quarters of fiscal 2025, the growth in merchandise and service revenues was $743.4 million, or 5.5%, compared with the corresponding period of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $57.0 million. Same-store merchandise revenues decreased by 0.9% in the United States, by 1.0% in Europe and other regions1, and by 1.0% in Canada. Road transportation fuel revenues Total road transportation fuel revenues for the third quarter of fiscal 2025 were $15.4 billion, an increase of $1.1 billion compared with the corresponding quarter of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $164.0 million. The remaining increase of approximately $1.3 billion, or 8.7%, is mainly attributable to the contribution from acquisitions, which amounted to approximately $2.0 billion, and higher revenues in our European wholesale activities following a change in our business model, while being partly offset by a lower average road transportation fuel selling price, which had a negative impact of approximately $906.0 million, and softness in fuel demand. Same-store road transportation fuel volumes decreased by 3.0% in the United States, impacted by unusual winter conditions and lower traffic in regions where we have a strong presence. Same-store road transportation fuel volumes decreased by 0.9% in Europe and other regions, and increased by 3.6% in Canada. For the first three quarters of fiscal 2025, the road transportation fuel revenues increased by $4.2 billion, or 11.2% compared with the corresponding period of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $144.0 million. Same-store road transportation fuel volumes decreased by 2.1% in the United States, by 0.8% in Europe and other regions, and increased by 0.9% in Canada. The following table shows the average selling price of road transportation fuel of our company-operated stores in our various markets for the last eight quarters. The average selling price of road transportation fuel consists of the road transportation fuel revenues divided by the volume of road transportation fuel sold:
Other revenues Total other revenues for the third quarter of fiscal 2025 were $192.2 million, a decrease of $57.2 million compared with the corresponding quarter of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $5.0 million. The remaining decrease of approximately $52.0 million, or 20.9%, is primarily driven by lower revenues from our heating oil and marine fuel products following a decrease in demand, partly offset by the contribution from acquisitions, which amounted to approximately $14.0 million. For the first three quarters of fiscal 2025, total other revenues were $454.7 million, a decrease of $62.8 million, or 12.1%, compared with the corresponding period of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $3.0 million. Gross profit1 Our gross profit was $3.8 billion for the third quarter of fiscal 2025, up by $322.7 million, or 9.4%, compared with the corresponding quarter of fiscal 2024, mainly attributable to the contribution from acquisitions, higher road transportation fuel gross margin1, improved merchandise and service gross margins, partly offset by softness in fuel demand in the United States. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $32.0 million. For the first three quarters of fiscal 2025, our gross profit increased by $771.9 million, or 8.3%, compared with the first three quarters of fiscal 2024, mainly attributable to similar factors as those of the third quarter. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $37.0 million.
Merchandise and service gross profit In the third quarter of fiscal 2025, our merchandise and service gross profit was $1.8 billion, an increase of $118.0 million compared with the corresponding quarter of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $16.0 million. The remaining increase of approximately $134.0 million, or 7.8%, is primarily attributable to the contribution from acquisitions, which amounted to approximately $89.0 million, and improved merchandise and service gross margin in the United States. Our merchandise and service gross margin1 increased by 0.9% in the United States to 34.0%, impacted by improved supply conditions, while it decreased by 0.2% to 39.0% in Europe and other regions. Our merchandise and service gross margin1 decreased by 1.8% in Canada to 32.4%, due to a different product mix as new alcohol revenues have a lower margin rate than the other nicotine products that are no longer sold in our stores. During the first three quarters of fiscal 2025, our merchandise and service gross profit was $4.9 billion, an increase of $270.9 million compared with the first three quarters of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $21.0 million. Our merchandise and service gross margin1 decreased by 0.2% to 33.8% in the United States, by 0.3% in Europe and other regions to 39.0%, and by 0.2% in Canada to 33.6%. Road transportation fuel gross profit In the third quarter of fiscal 2025, our road transportation fuel gross profit was $1.9 billion, an increase of $188.5 million compared with the corresponding quarter of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $16.0 million. The remaining increase of $204.0 million, or 12.2%, is mainly driven by the contribution from acquisitions, which amounted to approximately $122.0 million, improved road transportation fuel gross margin1 in all regions, partly offset by softness in fuel demand and traffic in the United States, impacted by unusual winter conditions. In the United States, our road transportation fuel gross margin1 was 44.28¢ per gallon, an increase of 1.09¢ per gallon, in Europe and other regions, it was US 9.29¢ per liter, an increase of US 0.73¢ per liter, and in Canada, it was CA 13.54¢ per liter, an increase of CA 0.55¢ per liter. Fuel margins remained healthy throughout our network, due the continued work on the optimization of our supply chain and strong execution in our stores. In Europe and other regions, road transportation fuel gross margin was also unfavorably impacted by a change in our wholesale activities. During the first three quarters of fiscal 2025, our road transportation fuel gross profit was $5.0 billion, an increase of $458.7 million compared with the first three quarters of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $16.0 million. The road transportation fuel gross margin1 was 46.02¢ per gallon in the United States, US 9.48¢ per liter in Europe and other regions, and CA 13.35¢ per liter in Canada. The road transportation fuel gross margin1 of our company-operated stores in the United States and the impact of expenses related to electronic payment modes for the last eight quarters, were as follows:
The road transportation fuel gross margin1 of our network in Europe and other regions and in Canada for the last eight quarters, were as follows:
Generally, road transportation fuel gross margins1 can be volatile from one quarter to another but tend to be more stable over longer periods. In Europe and other regions, fuel margin volatility is impacted by a longer supply chain due to a more integrated model. In Europe and other regions and in Canada, expenses related to electronic payment modes are not as volatile as in the United States. Other revenues gross profit In the third quarter of fiscal 2025, other revenues gross profit was $69.8 million, an increase of $16.2 million, or 30.2%, compared with the corresponding quarter of fiscal 2024, mainly attributable to the contribution from acquisitions, which amounted to approximately $12.0 million. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $1.0 million on other revenues gross profit. During the first three quarters of fiscal 2025, other revenues gross profit was $166.3 million, an increase of $42.3 million, or 34.1%, compared with the corresponding period of fiscal 2024. The translation of our foreign currency operations into US dollars had a negative impact of approximately 1.0 million on other revenues gross profit.
Operating, selling, general and administrative expenses ("expenses") For the third quarter and first three quarters of fiscal 2025, expenses increased by 8.1% and 11.0%, respectively, compared with the corresponding periods of fiscal 2024. Normalized growth of expenses1 was 2.6% and 2.8%, respectively, as shown in the table below:
Normalized growth of expenses1 for the third quarter and first three quarters of fiscal 2025 was mainly driven by inflationary pressures and incremental investments to support our strategic initiatives, while being partly offset by the continued strategic efforts to control our expenses, including labor efficiency in our stores.
Earnings before interest, taxes, depreciation, amortization and impairment ("EBITDA1") and adjusted EBITDA1 During the third quarter of fiscal 2025, EBITDA stood at $1.6 billion, an increase of $164.0 million, or 11.2%, compared with the corresponding quarter of fiscal 2024. Adjusted EBITDA for the third quarter of fiscal 2025 increased by $167.1 million, or 11.3%, compared with the corresponding quarter of fiscal 2024, mainly due to higher road transportation fuel gross margin1, the contribution from acquisitions, which amounted to approximately $104.0 million, and organic growth in our convenience operations, partly offset by softness in fuel demand. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $12.0 million. During the first three quarters of fiscal 2025, EBITDA stood at $4.7 billion, an increase of $277.0 million, or 6.2%, compared with the first three quarters of fiscal 2024. Adjusted EBITDA for the first three quarters of fiscal 2025 increased by $276.4 million, or 6.2%, compared with the first three quarters of fiscal 2024, mainly attributable to the contribution from acquisitions, which amounted to approximately $389.0 million, and higher road transportation fuel gross margin1 in Europe and other regions, partly offset by lower road transportation road transportation fuel gross margin1 in the United States, as well as by softness in traffic and fuel demand as low income consumers were impacted by challenging economic conditions. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $15.0 million. Depreciation, amortization and impairment ("depreciation") For the third quarter of fiscal 2025, our depreciation expense increased by $118.7 million, or 22.1%, compared with the third quarter of fiscal 2024, mainly driven by the impact from investments made through business acquisitions, which amounted to approximately $70.0 million, the replacement of equipment, as well as the ongoing improvements made to our network. The translation of our foreign currency operations into US dollars had a net favorable impact of approximately $6.0 million on depreciation. For the first three quarters of fiscal 2025, our depreciation expense increased by $297.0 million, compared with the first three quarters of fiscal 2024. The translation of our foreign currency operations into US dollars had a net favorable impact of approximately $6.0 million. The remaining increase of $303.0 million, or 23.9%, is mainly attributable to similar factors as those of the third quarter.
Net financial expenses Net financial expenses for the third quarter and first three quarters of fiscal 2025 were $159.6 million and $392.5 million, respectively, an increase of $29.3 million and $144.5 million, respectively, compared with the corresponding periods of fiscal 2024. A portion of the variation is explained by certain items that are not considered indicative of future trends, as shown in the table below:
The remaining variation of the third quarter and first three quarters of fiscal 2025 is mainly driven by higher average short-term and long-term debt in connection with our recent acquisitions. Income taxes The income tax rate for the third quarter was 21.0% compared with 22.0% for the corresponding quarter of fiscal 2024. The income tax rate for the first three quarters of fiscal 2025 was 22.6%, similar to the corresponding period of fiscal 2024. The decrease for the third quarter of fiscal 2025 is mainly stemming from the impact of a different mix in our earnings across the various jurisdictions in which we operate. Net earnings attributable to shareholders of the Corporation and adjusted net earnings attributable to shareholders of the Corporation1 Net earnings attributable to shareholders of the Corporation for the third quarter of fiscal 2025 were $641.4 million, compared with $623.4 million for the third quarter of fiscal 2024, an increase of $18.0 million, or 2.9%. Diluted net earnings per share stood at $0.68, compared with $0.65 for the corresponding quarter of the previous fiscal year. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $6.0 million on net earnings attributable to shareholders of the Corporation for the third quarter of fiscal 2025. Adjusted net earnings attributable to shareholders of the Corporation for the third quarter of fiscal 2025 were approximately $641.0 million, compared with $625.0 million for the third quarter of fiscal 2024, an increase of $16.0 million, or 2.6%. Adjusted diluted net earnings per share1 were $0.68 for the third quarter of fiscal 2025, compared with $0.65 for the corresponding quarter of fiscal 2024, an increase of 4.6%. For the first three quarters of fiscal 2025, net earnings attributable to shareholders of the Corporation stood at $2.1 billion, a decrease of $135.7 million, or 6.0%, compared with the first three quarters of fiscal 2024. Diluted net earnings per share stood at $2.25, compared with $2.35 for the corresponding period of fiscal 2024. The translation of our foreign currency operations into US dollars had a net negative impact of approximately $8.0 million on net earnings attributable to shareholders of the Corporation for the first three quarters of fiscal 2025. Adjusted net earnings attributable to shareholders of the Corporation for the first three quarters of fiscal 2025 stood at $2.1 billion, a decrease of $119.0 million, or 5.3%, compared with the first three quarters of fiscal 2024. Adjusted diluted net earnings per share1 were $2.25 for the first three quarters of fiscal 2025, compared with $2.32 for the first three quarters of fiscal 2024, a decrease of 3.0%. Dividends During its March 18, 2025 meeting, the Board of Directors declared a quarterly dividend of CA 19.5¢ per share for the third quarter of fiscal 2025 to shareholders on record as at March 27, 2025, and approved its payment effective April 10, 2025. This is an eligible dividend within the meaning of the Income Tax Act (Canada).
Non-IFRS Accounting Standards Measures To provide more information for evaluating the Corporation's performance, the financial information included in our financial documents contains certain data that are not performance measures under IFRS® Accounting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards"), which are also calculated on an adjusted basis to exclude specific items. Those performance measures are called "Non-IFRS Accounting Standards measures". We believe that providing those Non-IFRS Accounting Standards measures is useful to management, investors, and analysts, as they provide additional information to measure the performance and financial position of the Corporation. The following Non-IFRS Accounting Standards financial measures are used in our financial disclosures:
The following Non-IFRS Accounting Standards ratios are used in our financial disclosures:
The following capital management measure is used in our financial disclosures:
Supplementary financial measures are also used in our financial disclosures and those measures are described where they are presented. Non-IFRS Accounting Standards financial measures and ratios, as well as the capital management measure, are mainly derived from the consolidated financial statements but do not have standardized meanings prescribed by IFRS Accounting Standards. These Non-IFRS Accounting Standards measures should not be considered in isolation or as a substitute for financial measures prepared in accordance with IFRS Accounting Standards. In addition, our definitions of Non-IFRS Accounting Standards measures may differ from those of other public corporations. Any such modification or reformulation may be significant. These measures are also adjusted for the pro forma impact of our acquisitions and impacts of new accounting standards if they are considered to be material. Gross profit. Gross profit consists of Revenues less the Cost of sales, excluding depreciation, amortization and impairment. This measure is considered useful for evaluating the underlying performance of our operations. The table below reconciles Revenues and Cost of sales, excluding depreciation, amortization and impairment, as per IFRS Accounting Standards, to Gross profit:
Please note that the same reconciliation applies in the determination of gross profit by category and by geography presented in the section "Summary Analysis of Consolidated Results". Merchandise and service gross margin. Merchandise and service gross margin consists of Merchandise and service gross profit divided by Merchandise and service revenues, both measures are presented in the section "Summary Analysis of Consolidated Results". Merchandise and service gross margin is considered useful for evaluating how efficiently we generate gross profit by dollar of revenue. Road transportation fuel gross margin. Road transportation fuel gross margin consists of Road transportation fuel gross profit divided by Total volume of road transportation fuel sold. For the United States and Europe and other regions, both measures are presented in the section "Summary Analysis of Consolidated Results". For Canada, this measure is presented in functional currency and the table below reconciles, for road transportation fuel, Revenues and Cost of sales, excluding depreciation, amortization and impairment, as per IFRS Accounting Standards, to Gross profit and the resulting road transportation fuel gross margin. This measure is considered useful for evaluating how efficiently we generate gross profit by gallon or liter of road transportation fuel sold.
Normalized growth of (decrease in) operating, selling, general and administrative expenses ("normalized growth of (decrease in) expenses"). Normalized growth of (decrease in) expenses consists of the growth of (decrease in) Operating, selling, general and administrative expenses adjusted for the impact of the changes in our network, the impact from changes in accounting policies and adoption of accounting standards, the impact of more volatile items over which we have limited control including, but not limited to, the net impact of foreign exchange translation, electronic payment fees excluding acquisitions, acquisition costs, and incremental system integration costs related to acquisitions, as well as other specific items for which the impact on consolidated results is not deemed indicative of future trends. Please note that the composition of this measure was adjusted to include the incremental system integration costs related to acquisitions, given the level of associated efforts is related to the magnitude and complexity of the acquired businesses. This measure is considered useful for evaluating our ability to control our expenses on a comparable basis. The tables below reconcile growth of (decrease in) Operating, selling, general and administrative expenses to normalized growth of (decrease in) expenses:
Growth of (decrease in) same-store merchandise revenues for Europe and other regions. Same-store merchandise revenues represent cumulative merchandise revenues between the current period and comparative period for those stores that were open for at least 23 days out of every 28-day period included in the reported periods. Merchandise revenues are defined as Merchandise and service revenues excluding service revenues. For Europe and other regions, the growth of (decrease in) same-store merchandise revenues is calculated based on constant currencies using the respective current period average exchange rate for both the current and corresponding period. In Europe and other regions, same-store merchandise revenues include same-store revenues from company-operated stores, as well as CODO and DODO stores which are not included in our consolidated results. This measure is considered useful for evaluating our ability to generate organic growth on a comparable basis in our overall European and other regions store network. Growth of (decrease in) same-store merchandise revenues for Europe and other regions include results from the acquisition of certain European retail assets from TotalEnergies SE starting December 28, 2023. The tables below reconcile Merchandise and service revenues, as per IFRS Accounting Standards, to same-store merchandise revenues for Europe and other regions and the resulting percentage of growth (decrease):
Earnings before interest, taxes, depreciation, amortization and impairment ("EBITDA") and adjusted EBITDA. EBITDA represents Net earnings plus Income taxes, Net financial expenses, and Depreciation, amortization and impairment. Adjusted EBITDA represents the EBITDA adjusted for acquisition costs, the impact from changes in accounting policies and adoption of accounting standards, as well as other specific items for which the impact on consolidated results is not deemed indicative of future trends. These performance measures are considered useful to facilitate the evaluation of our ongoing operations and our ability to generate cash flows to fund our cash requirements, including our capital expenditures program, share repurchases, and payment of dividends. The table below reconciles Net earnings, as per IFRS Accounting Standards, to EBITDA and adjusted EBITDA:
Adjusted net earnings attributable to shareholders of the Corporation and adjusted diluted net earnings per share. Adjusted net earnings attributable to shareholders of the Corporation represents Net earnings attributable to shareholders of the Corporation adjusted for net foreign exchange gains or losses, acquisition costs, the impact from changes in accounting policies and adoption of accounting standards, impairment on goodwill, investments in subsidiaries, joint ventures and associated companies, as well as other specific items for which the impact on consolidated results is not deemed indicative of future trends, and the impact of the non-controlling interests on the items mentioned previously. These measures are considered useful for evaluating the underlying performance of our operations on a comparable basis. The table below reconciles Net earnings attributable to shareholders of the Corporation, as per IFRS Accounting Standards, with adjusted net earnings attributable to shareholders of the Corporation and adjusted diluted net earnings per share:
Interest-bearing debt. This measure represents the sum of the following balance sheet accounts: Short-term debt and current portion of long-term debt, Long-term debt, Current portion of lease liabilities and Lease liabilities. This measure is considered useful to facilitate the understanding of our financial position in relation with financing obligations. The calculation of this measure of financial position is detailed in the "Net interest-bearing debt/total capitalization" section below. Net interest-bearing debt/total capitalization. This measure represents the basis for monitoring our capital and is considered useful to assess our financial health, risk profile, and ability to meet our financing obligations. It also provides insights into how our financing obligations are structured in relation with our total capitalization. The table below presents the calculation of this performance measure:
Leverage ratio. This measure represents a measure of financial condition considered useful to assess our financial leverage and our ability to cover our net financing obligations in relation to our adjusted EBITDA.
The table below reconciles net interest-bearing debt and adjusted EBITDA, for which the calculation methodologies are described in other tables of this section, as well as the pro forma impact of the acquisition of certain European retail assets from TotalEnergies SE, with the leverage ratio:
Return on equity. This measure is considered useful to assess the relationship between our profitability and our net assets and it also provides insights into how efficiently we are using our equity to generate returns for our shareholders. Average equity attributable to shareholders of the Corporation is calculated by taking the average of the opening and closing balance for the 52-week periods. The table below reconciles Net earnings attributable to shareholders of the Corporation, as per IFRS Accounting Standards, with the ratio of return on equity:
Return on capital employed. This measure is considered useful as it provides insights into our ability to generate returns from the total amount of capital invested in our operations and it also helps in assessing our operational efficiency and capital allocation decisions. Earnings before interest and taxes ("EBIT") represents Net earnings plus Income taxes and Net financial expenses. Capital employed represents total assets less short-term liabilities not bearing interest, which excludes the Short-term debt and current portion of long-term debt and Current portion of lease liabilities. Average capital employed is calculated by taking the average of i) the opening balance of capital employed for the 52-week periods and pro forma adjustments and ii) the ending balance of capital employed for the 52-week periods. The table below reconciles Net earnings, as per IFRS Accounting Standards, to EBIT with the ratio of Return on capital employed, including the pro forma impact of the acquisition of certain European retail assets from TotalEnergies SE:
Profile Couche-Tard is a global leader in convenience and mobility, operating in 29 countries and territories, with close to 17,000 stores, of which approximately 13,000 offer road transportation fuel. With its well-known Couche-Tard and Circle K banners, it is one of the largest independent convenience store operators in the United States and it is a leader in the convenience store industry and road transportation fuel retail in Canada, Scandinavia, the Baltics, Belgium, as well as in Ireland. It also has an important presence in Luxembourg, Germany, the Netherlands, Poland, as well as in Hong Kong Special Administrative Region of the People's Republic of China. Approximately 149,000 people are employed throughout its network. For more information on Alimentation Couche-Tard Inc., or to consult its audited annual Consolidated Financial Statements, unaudited interim condensed consolidated financial statements and Management Discussion and Analysis, please visit:https://corpo.couche-tard.com. Forward-looking statements The statements set forth in this press release, which describes Couche-Tard's objectives, projections, estimates, expectations, or forecasts, may constitute forward-looking statements within the meaning of securities legislation. Positive or negative verbs such as "believe", "can", "shall", "intend", "expect", "estimate", "assume", and other related expressions are used to identify such statements. Couche-Tard would like to point out that, by their very nature, forward-looking statements involve risks and uncertainties such that its results, or the measures it adopts, could differ materially from those indicated in or underlying these statements, or could have an impact on the degree of realization of a particular projection. Major factors that may lead to a material difference between Couche-Tard's actual results and the projections or expectations set forth in the forward-looking statements include the effects of the integration of acquired businesses and the ability to achieve projected synergies, ongoing military conflicts, fluctuations in margins on motor fuel sales, competition in the convenience store and retail motor fuel industries, exchange rate variations, and such other risks as described in detail from time to time in the reports filed by Couche-Tard with securities authorities in Canada and the United States. Among other things, our synergies objective is based on our comparative analysis of organizational structures and current level of spending across our network as well as on our ability to bridge the gap, where relevant. Our synergies objective is also based on our assessment of current contracts in the geographical areas of operations and how we expect to be able to renegotiate these contracts to take advantage of our increased purchasing power. In addition, our synergies objective assumes that we will be able to establish and maintain an effective process for sharing best practices across our network. Finally, our objective is also based on our ability to integrate acquired business. An important change in these facts and assumptions could significantly impact our synergies estimate as well as the timing of the implementation of our different initiatives. Unless otherwise required by applicable securities laws, Couche-Tard disclaims any intention or obligation to update or revise forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking information in this release is based on information available as of the date of the release. Webcast on March 19, 2025 at 8:00 A.M. (EDT) Couche-Tard invites analysts known to the Corporation to ask their questions to its management on March 19, 2025, during the question and answer period of the webcast. Financial Analysts, Investors, media and any individuals interested in listening to the webcast on Couche-Tard's results, which will take place online on March 19, 2025, at 8:00 A.M. (EDT) can do so by either accessing the Corporation's website at https://corpo.couche-tard.com/ and by clicking in the "Investors/Events & Presentations" section or by using the following link https://emportal.ink/3Qixbyc to join the conference call without the assistance of an operator. An automated system will automatically return the call to grant you access to the conference call. Another option could be to access the conference call through an operator by dialing 1-289-819-1299 or the international number 1-800-990-4777. Rebroadcast: For individuals who will not be able to listen to the live webcast, a recording of the webcast will be available on the Corporation's website for a period of 90 days.
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Company Codes: Toronto:ATD | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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