Alimentation Couche-Tard, which operates the Circle K forecourt business, has reported what it described as a 'solid' third quarter, despite the COVID-19 pandemic, with the business seeing its revenues drop by 20.8%, largely due to lower fuel demand.
The group reported revenue of $13.2 billion (€11.05 billion) for the third quarter, which was down $3.4 billion on the same period the previous year. For the first three quarters of its 2021 financial year, revenues were down $10.9 billion (€9.12 billion), or 24.6% compared to fiscal 2020.
Nonetheless, the business posted encouraging like-for-likes across its store operations, reporting same store sales growth of 2.9% in the U.S., 4.7% in Canada, and 2.8% in Europe and other regions "as our customers continued to visit our convenient locations for their everyday needs," commented chief executive Brian Hannasch.
"This quarter, I am particularly proud of our team members' ongoing commitment to our customers and the business, especially as the impact of the virus escalated across most areas where we operate," he added.
Revenue Performance
Total merchandise and service revenues for the third quarter of the year stood at $4.5 billion, an increase of $241.9 million compared with the corresponding quarter the previous year, as the group saw increases in basket size, which was offset by a 'continued softness' in traffic.
'The tobacco, packaged beverage, alcohol and grocery products categories continued to perform well across all our regions,' it said.
Transportation fuel revenues, however, were down by close to a third, dropping $3.6 billion, or 30.3% compared to the same period the previous year.
The group said that it has made strides in evolving its model to become a 'more innovative and differentiated retailer', with the continued rollout of its 'Fresh Food Fast' programme, localised promotions, as well as car-charging solutions across its network.
'Challenging Environment'
"We maintained solid momentum during the quarter in the face of a challenging environment," said Claude Tessier, Couche-Tard's chief financial officer.
"Our business continued to generate strong cash flows as we stayed true to our usual cost discipline and focus on operating efficiency. I would like to highlight the work our teams have accomplished throughout the last year, ensuring that we emerge from the pandemic in a strong financial position and ready to accelerate capital deployment towards our strategic initiatives."
There was nothing in the release about Couche-Tard's aborted move to take over French retailer Carrefour, with the two businesses saying in January that they were examining 'opportunities for operational partnerships'.
Couche-Tard, which is headquartered in Canada, operates in 26 countries and territories, with more than 14,200 stores, of which approximately 10,800 are fuel forecourt operations.
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