Alimentation Couche-Tard Inc (TSX:ATD.B) released its Q2 results on Tuesday which saw the company post record earnings of $435.3 million, which is a 35% increase from last year. Revenues were also up 44% year-over-year as the company benefited from this year’s quarterly results including CST Brands Inc, which was not present in the prior year’s results. Couche-Tard’s performance likely would have been even stronger if not for the impact that Hurricanes Harvey and Irma had on many of its locations.
Despite the adverse weather conditions in the past quarter, Couche-Tard saw merchandise revenues in the U.S. rise 25% while fuel sales were up over 46%. The U.S. market made up nearly two-thirds of the company’s total sales for the quarter.
Couche-Tard continued to see growth in Europe and Canada as well, with the latter seeing fuel revenues of $1.1 billion more than double last year’s tally.
Although CST Brands certainly gave Couche-Tard a boost in Q2, same-store sales growth showed some problems for the company. The U.S. saw growth of just 0.7% for the quarter in its merchandise revenue compared to 2.3% a year ago. Sales were likely impacted by the hurricanes, but the company also saw same-store merchandise sales in Europe grow just 1.6% compared to 3.5% a year ago. In Canada, sales were down 1.6%.
If we look at fuel-related volumes in same-store sales then we see declines across the U.S., Europe, and Canada, with the latter seeing a drop of 2.3%.
The problem from an investor’s standpoint is that for the company to continue to grow it may only be able to do so through acquisitions.
