MONTREAL - Alimentation Couche-Tard says it remains committed to acquiring Casey's General Stores despite the legal roadblocks set up by the company's board.
The Iowa-based convenience store chain has filed several lawsuits and legal motions to thwart Couche-Tard's US$1.9-billion hostile takeover bid. The latest came Monday when it filed a motion to dismiss Couche-Tard's counterclaim against an accusation of stock manipulation.
Couche-Tard president and CEO Alain Bouchard said these legal manoeuvres are inappropriate and only mislead Casey's shareholders.
"Why not give the choice to the true owners, the shareholders," Bouchard said Tuesday during a webcast to discuss Couche-Tard's fourth-quarter and year-end results.
The Montreal-area convenience store operator saw its profits surge in the fourth quarter as it benefited from higher merchandise sales, solid fuel sales, controlled expenses and proceeds from the opportunistic sale of Casey's stock.
Couche-Tard (TSX:ATD.B), which operates under various banners including Mac's, Provi-Soir and Circle K, said it earned US$68.8 million, or 37 cents per share, for the period ended April 25.
That's up more than 81 per cent from US$38 million, or 20 cents, a year earlier. Excluding one-time items such as Couche-Tard's sale of Casey's shares, it earned 29 cents or three cents better than analyst estimates.
Higher fuel prices, acquisitions and the higher Canadian dollar boosted revenues by nearly 34 per cent or US$1 billion to US$4 billion. That also beat analyst estimates of US$3.88 billion.
Bouchard foresees great opportunities to expand its business but will continue to be patient about not overpaying for targets such as Casey's General Stores in light of current market conditions.
"We believe our offer price represents full and fair value for Casey's."
He said the US$36 per share all-cash offer gives Casey's shareholders an immediate premium and avoids any uncertainty about the future performance of Casey's stock.
As for Couche-Tard's results, Bouchard said he was satisfied with the numbers and believes the efforts of the last few quarters have put it in "a pretty good position for the upcoming years."
"It is these same efforts that made fiscal 2010 a record-breaking year for us in terms of net earnings, right in the middle of a recession," he said.
"That makes me pretty proud of what we accomplished and it makes me confident for the future."
Couche-Tard said its quarterly profit increased because of higher U.S. motor fuel gross margins, increased merchandise sales, acquisitions and a reversal of provisions.
The company, which reports in U.S. currency, also scored an $11.4-million gain, net of taxes, on the disposal of nearly two million Casey's (Nasdaq:CASY) shares on the day it announced its takeover bid. Casey's shares rosethree cents Tuesday to match the US$36 offer price by Couche-Tard.
For the year, Couche-Tard earned $302.9 billion, or $1.60 per share, on a fully diluted basis. That compared with $253.9 million, or $1.29, a year earlier.
Annual revenues increased 4.1 per cent to $16.4 billion, from $15.78 billion.
Irene Nattel of RBC Capital Markets said Couche-Tard is starting the fiscal year from a strong operating base and with stabilization in the North American economies.
"We should expect improving operating trends as we move through the year. As for the Casey's situation, it is evolving largely in line with expectations," she wrote in a report.
On the Toronto Stock Exchange, Couche-Tard's shares closed up 64 cents, or 3.22 per cent, at $20.50 in Tuesday trading.
Couche-Tard is the second-largest convenience store chain in the North America with 5,878 stores, including nearly 4,400 company-owned locations.
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