Global convenience store Circle K has purchased 53 Cracker Barrel sites in Louisiana.
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Revenues were $8.4 billion, a 6.2 per cent decrease from nearly $9 billion a year ago.
Excluding one-time items, Couche-Tard (TSX:ATD.B), which reports in USA currency, earned US$328 million or 58 cents per share in adjusted profits.
Lower fuel prices didn’t hurt gross fuel margins, the company said. They would become part of Circle K’s Gulf Coast region. The transaction is anticipated to close in the third quarter of Couche-Tard’s fiscal year 2017 and is subject to the standard regulatory approvals and closing conditions.
Analysts were forecasting a profit of 57 cents per share on revenue of about $8.7-billion.
The company’s 58 cents per share adjusted diluted earnings came in above BMO analyst Peter Sklar’s estimate of 54 cents, which he says can mostly be attributed to a positive USA fuel margin of US20.86 cents per gallon, higher than his forecasted US18 cents.
These convenience stores now operate under the store brand Cracker Barrel and include 12 quick service restaurants. Couche-Tard has more company-operated stores than any other independent convenience store operator in the United States.
Last week, the Laval, Que. -based Couche-Tard announced the biggest deal in its history – a US$4.4 billion friendly acquisition of CST Brands, which is headquartered in San Antonio and has more than 2,000 stores in the USA and Eastern Canada.
Last year, Couche-Tard acquired The Pantry Inc. chain for about $1.7 billion, including debt, adding more than 1,500 USA stores. Barclays PLC upgraded shares of Alimentation Couche-Tard from an “equal weight” rating to an “overweight” rating and increased their target price for the company from $61.00 to $76.00 in a research report on Wednesday, August 24th. Finally, Credit Suisse Group AG reissued an “underperform” rating and issued a $55.00 price target (up from $47.00) on shares of Alimentation Couche-Tard in a report on Wednesday, August 24th.
About Alimentation Couche-Tard Inc.
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Excluding the CST and Cracker Barrel acquisitions, Couche-Tard’s network includes 7,863 convenience stores throughout North America and 2,708 stores in Europe. In addition, more than 1,500 stores operate under the Circle K banner under licensing agreements in 13 countries around the world.
