Alain Bouchard, president of Alimentation Couche-Tard IncPaul Chiasson
Alimentation Couche-Tard raised its dividend 25 per cent after the convenience store operator's net earnings grew nearly 20 per cent to $105.6-million (U.S.) in the late summer quarter.
The Montreal-based company, which reports in U.S. dollars, beat analyst expectations by earning 56 cents per share for the period ended Oct. 10, compared to 47 cents a year earlier when it earned $88-million.
Second-quarter revenues increased 10.8 per cent to $4.2-billion.
Analysts polled by Thomson Reuters had expected 50 cents in EPS and $4.27-billion in revenues.
Couche-Tard said it hiked its quarterly dividend one cent per share to five cents because of good results and a strong balance sheet.
The higher profit reflected increasing merchandise sales, higher fuel margins in the U.S., more stores dispensing fuel, the higher Canadian dollar and lower tax rates.
It was partially offset by increased electronic payment costs from higher fuel prices and costs associated with its abandoned effort to purchase Casey's General Stores on which the company spent $7-million during the quarter.
Merchandise sales grew 5.6 per cent to $1.5-billion, while fuel revenues increased 13.9 per cent to $2.7-billion.
Sales for stores open at least a year - same store sales - were up 4.9 per cent in the U.S. and 1.6 per cent in Canada for merchandise. Same-store fuel volumes were up 0.5 per cent in the U.S. and 5.3 per cent in Canada.
Couche-Tard is Canada's largest convenience store operator and the second-largest in North America. Its operates a network of 5,904 stores across Canada and in 42 U.S. states.
It employs more than 53,000 people and operates under the Circle-K, Mac's and Couche-Tard banners, among others.
On the Toronto Stock Exchange, Couche-Tard's shares gained 45 cents (Canadian), or 1.78 per cent, at $25.72 in morning trading.