Canadian Tire boosts dividend 16.7% despite dip in earnings
A man walks into a Canadian Tire store in Levis, Que., Monday, May 9, 2011. (Jacques Boissinot / THE CANADIAN PRESS)
Published Thursday, November 8, 2012 12:25PM EST
TORONTO -- Canadian Tire Corp. Ltd. is boosting its dividend almost 17 per cent even as the general merchandise, sporting goods and automotive parts and services retailer reported a dip in third-quarter profits.
The new quarterly dividend -- up five cents to 35 cents per share -- is payable March 1, 2013, to shareholders of record as of Jan. 1.
Based on the company's mid-morning share price on the Toronto Stock Exchange of $70.74, down 42 cents, that would produce a yield of 1.98 per cent.
Canadian tire said Thursday that net earnings in the three months ended Sept. 29 were $131.4 million or $1.61 per diluted share, down from $1.67 per diluted share in the comparable year-earlier period.
Consolidated sales were up eight per cent, while consolidated revenue increased 4.6 per cent to $2.83 billion.
The company credits the inclusion of FGL Sports revenue for 13 weeks compared to six weeks in Q3 2011 as well as revenue growth at its Mark's clothing outlets and higher petroleum sales and financial services revenue.
However, consolidated net income declined 3.7 per cent compared to the prior year. Included in net income in the third quarter of 2011 were net benefits related to the acquisition of FGL Sports, reduced income tax expense and interest income received related to resolution of tax matters.
Excluding these items, net income would have increased 3.5 per cent in the most recent period.