LAVAL, Quebec -- With U.S. fuel margins continuing to run well over 20 cents per gallon and gasoline volumes on the rise, retailer Alimentation Couche-Tard, dba Circle K Convenience Stores, reported this week net earnings of $286.4 million for the second quarter of fiscal 2015.
“We are very pleased with the results of the second quarter, which are consistent with our previous quarters’ excellent performance," said Brian Hannasch , who was appointed to the position of president and chief executive officer in September. "We continue to innovate in our stores, improving our offer. A current example is the rollout of our Simply Great Coffee program in Europe, which is generating strong results. This is the type of innovation, along with the hard work of our teams, that allow us, quarter after quarter, to present great organic growth in our merchandises and services sales.”
Excluding non-recurring items for both comparable periods, net earnings for the quarter would have been $313.0 million, compared to $249.0 million for the second quarter of fiscal 2014, an increase of 25.7%. Other highlights of the quarter include:
- Same-store merchandise revenues up 2.8% in the United States, +2.1% in Europe and +3.0% in Canada.
- Merchandise and service gross margin stood at 32.7% in the U.S., at 41.2% in Europe and at 33.5% in Canada, for a consolidated margin of 34.0%, an increase of 0.2%.
- Same-store road transportation fuel volume up 2.1% in the U.S ., 2.2% in Europe and in slight decrease of 1.1% in Canada.
- Road-transportation-fuel gross margin at US24.17 cents per gallon in the United States, at US11.48 cents per liter in Europe and at CA6.69 cents per liter in Canada.
- Return on capital employed continues to improve, reaching 14.9% while return on equity still solid at 22.6%.
“Our performance this quarter is also the result of strong fuel margins combined with solid volume growth driven by our 'miles' brand in Europe, our consistent retail execution, our initiatives to improve our operational efficiency, our consistency in reducing our debt and our improvements to our network," Hannasch said. "Our ability to influence our results at all these levels allows us to look forward to the future with enthusiasm.”
For the remainder of fiscal 2015, Couche-Tard expects "to pursue our investments with caution in order to, amongst other things, improve our network and build additional stores. We also intend to keep an ongoing focus on our sales, supply terms and operating expenses while keeping an eye on growth opportunities that may be available."
Also, the company will "continue focusing on the sale of fresh products and on innovation, including the introduction of new products and services, in order to satisfy the needs of our large clientele."
Laval, Quebec-based Couche-Tard is the leader in the Canadian convenience store industry. In the United States, it is the largest independent convenience-store operator in terms of number of company-operated stores. In Europe, Couche-Tard is a leader in convenience-store and road-transportation fuel in Scandinavian and Baltic countries while it has a significant presence in Poland.
As of Oct. 12 , 2014, Couche-Tard’s network comprised 6,303 convenience stores throughout North America, including 4,851 stores with road transportation fuel dispensing. Its North American network consists of 13 business units, including nine in the United States covering 40 states and four in Canada covering all 10 provinces.
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