Alimentation Couche-Tard (ATD) Q2 2025 earnings summary

Executive summary

• Q2 FY2025 net earnings attributable to shareholders were $708.8 million ($0.75 per diluted share), down from $819.2 million ($0.85 per share) year-over-year, mainly due to lower US fuel margins and higher expenses from acquisitions.

• Total revenues rose 6.0% to $17.4 billion, driven by acquisitions and higher wholesale fuel revenues, partially offset by lower average fuel prices and softer demand.

• Same-store merchandise revenues declined across all regions, reflecting constrained discretionary spending and continued cigarette industry decline.

• Strategic growth initiatives included ongoing M&A (notably GetGo and pursuit of Seven & i Holdings), organic store expansion, and integration of recent European acquisitions.

• Focused on value-driven promotions, private label expansion, loyalty program growth, and digital acceleration to drive traffic and unit growth.

Financial highlights

• Gross profit increased 7.3% to $3.2 billion, with merchandise and service gross profit up 5.3% and fuel gross profit up 8.9%, mainly from acquisitions.

• EBITDA for Q2 FY2025 was $1.5 billion, up 2.5% year-over-year; adjusted EBITDA rose 2.4%.

• Adjusted diluted net earnings per share decreased 9.8% year-over-year to $0.74.

• Merchandise and service gross margin declined 1.0% in the US to 33.8%, rose 0.4% in Canada to 33.6%, and fell 0.4% in Europe/other regions to 38.2%.

• Road transportation fuel gross margin in the US was 46.10¢/gallon (down 3.46¢), 10.51¢/liter in Europe/other regions (up 0.31¢), and CA 13.35¢/liter in Canada (down CA 0.28¢).

Outlook and guidance

• Management remains confident in the global network and long-term growth plan, citing positive momentum in US same-store merchandise revenues and healthy fuel margins.

• Continued focus on operational excellence, cost control, leveraging data analytics, and disciplined capital deployment to support shareholder value.

• Integration of newly acquired European network progressing well; further acquisitions and value creation initiatives planned.

• Ambition to reach $10B EBITDA by FY2028, fueled by organic growth and new M&A, including synergies from TotalEnergies.