The owner of the Circle K supermarket chain, Alimentation Couche-Tard, reported surprisingly weak sales and profits in its latest quarter — and signaled that consumer spending in the US was especially weak.
The Canadian owner of chain convenience stores and gas stations suffered a 2.2% sales drop in the quarter that ended Feb. 4, at the same time as adjusted profit tumbled to 65 cents a share — far below the 84 cents expected by analysts, in response to data compiled by Bloomberg.
The corporate’s $623.4 million in profits marked a roughly 15.5% decrease from the period prior when Couche-Tard raked in $737.4 million.
The firm blamed the declines on weak customer traffic and “near-term headwinds, especially in america,” Chief Executive Officer Brian Hannasch said in a statement issued Wednesday.
Couche-Tard — which makes most of its revenues on fuel sales — also noted that “a portion of our customers stays impacted by difficult economic conditions.”
Because of this, the corporate — which operates nearly 7,000 Circle K convenience stores across the US alone, in addition to Holiday Stationstores, that are primarily situated in the northwest, and Canadian chain Mac’s Convenience Stores — saw merchandise revenue per store, equivalent to food and cigarettes, drop in all three of the corporate’s geographic segments.
It was the primary time Couche-Tard saw such a drop in greater than a decade, Stifel Financial analyst Martin Landry said in a note earlier reported on by Bloomberg.
Nonetheless, 7-Eleven’s decline was even worse, “which is reassuring and suggests industry-wide weakness,” Landry added.
Couche-Tard, which had $19.6 billion in revenue in its latest quarter, operates a complete of about 16,700 sites, mostly in the US and Europe, in response to Bloomberg.
Through the period, the corporate closed the acquisition of 2,175 European sites for $3.8 billion from French petroleum giant TotalEnergies SE. Greater than half of those are in Germany, Bloomberg reported.
Representatives for Couche-Tard didn’t immediately reply to The Post’s request for comment.
Though consumers all over the place are feeling the squeeze, Americans are still facing stubbornly high inflation rates in addition to decades-high rates of interest — which the Federal Reserve kept unchanged on Wednesday.
The Fed’s benchmark overnight rate of interest, as expected, was held regular between 5.25% and 5.50%, where it’s sat since July.
Still, Fed Chair Jerome Powell affirmed central bankers’ view for 3 rate cuts this 12 months.
Speaking after the two-day policy meeting, Powell said the timing of the much-anticipated reductions still is dependent upon officials becoming safer that inflation can proceed to say no towards the Fed’s 2% goal in an economy that continues to outperform expectations.
The choice on when to chop rates will rely on more data, Powell said, to find out if the disappointing readings that began the 12 months proceed.
The Fed’s next meeting is about to happen April 30 to May 1.
The newest inflation reading, meanwhile, showed that the figure rose 3.2% in February.
On a monthly basis, price growth edged 0.4% higher last month, driven primarily by the indexes for shelter and gasoline, which contributed to greater than 60% of the advance.
In accordance with AAA data, the national average for a gallon of regular gas rings in at $3.53 — up from the month-ago average of $3.27.
Last month’s Consumer Price Index — which tracks changes in the prices of on a regular basis goods and services — marked yet one more rise in consumer prices, which haven’t fallen year-over-year since President Joe Biden’s term began in January 2021.
The closest the economy has gotten to a yearly decrease since Biden took office was in July 2022, when the inflation rate remained “unchanged,” at a sky-high 8.5%.
Overall, prices are up a staggering 19% since December 2020, the month before Biden moved into the White House — despite the president’s Bidenomics agenda, which he has consistently claimed works to “reduce the [government’s] deficit.”