May 14, 2015 / 1:27 PM / 3 years ago

UPDATE 1-Canadian Tire profit tops estimates on strong same-store sales

(Adds details, background)

May 14 (Reuters) - Retailer Canadian Tire Corp reported a better-than-expected quarterly profit, helped by strong sales of home products, sports gear and clothes.

Same-store sales rose 4.7 percent in the first quarter at Canadian Tire stores, which sell home and automotive products.

At FGL Sports, which sells sports-related products, same-store sales rose 8.6 percent, driven by strong footwear and athletic clothing sales.

Same store sales at Mark’s rose 5.5 percent, helped by demand for men’s casual wear and denim. The company sells casual and work clothing and footwear under the Mark’s brand.

However, the company, which also runs gas stations, said total revenue fell 2.3 percent to C$2.51 billion ($2.10 billion), hurt by lower gasoline prices.

Excluding petroleum, revenue increased 2.2 percent in the three months ended April 4, Canadian Tire said.

Net income attributable to the company fell to C$68.5 million from C$70.6 million, also hurt in part by the sale of 20 percent of its financial services business to Bank of Nova Scotia in October.

However, a lower share count kept earnings unchanged at 88 Canadian cents on a per share basis. That was higher than analysts’ average estimate of 87 Canadian cents per share, according to Thomson Reuters I/B/E/S.

Canadian retailers, which have been facing stiff competition from U.S. retailers such as Wal-Mart Stores Inc and Inc, are widely expected to benefit from Target Corp’s announcement in January that it would exit from Canada.

Toronto-based Canadian Tire said last week that it would buy leases for 12 properties previously held by the Canadian unit of Target for $17.7 million.

Canadian Tire shares had risen more than 17 percent in the past 12 months through Wednesday’s close, less than a 22 percent rise in the S&P TSX consumer discretionary sector index . ($1 = C$1.1952) (Reporting By Manya Venkatesh in Bengaluru; Editing by Saumyadeb Chakrabarty and Savio D’Souza)

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