Couche-Tard's "Core + More" strategy drives growth in Q4
Convenience retail giant Alimentation Couche-Tard closed fiscal 2026 with strong financial results, demonstrating how a balanced focus on customer experience, category growth, fuel optimization, and disciplined cost management can drive performance in a challenging market.
The company's fourth-quarter and full-year results offer several important lessons for convenience store operators navigating changing consumer habits, inflation pressures, and fluctuating fuel demand.
Couche-Tard's president and chief executive officer Alex Miller said:
"Our focus on delivering on our customer promise through our Core + More strategy is driving strong momentum across our U.S. business, with improved traffic and ongoing growth in key categories such as food and packaged beverages; meanwhile, our teams are leaning into the strength and agility of our fuel supply chain as well as our global scale to capture opportunities across our network as market conditions evolve. Overall, the commitment and resilience of our teams is reinforcing the progress we are making in the business as we continue to win in the markets we serve."
Fourth-quarter earnings increase
For the fourth quarter ended April 26, 2026, Couche-Tard reported net earnings attributable to shareholders of $863.4 million, compared with $439.4 million in the fourth quarter of fiscal 2025.
Diluted net earnings per share were $0.94, compared with $0.46 in the prior-year quarter. Adjusted net earnings attributable to shareholders were approximately $667.0 million, compared with $441.0 million in the corresponding quarter last year, an increase of 51.2%.
Adjusted diluted net earnings per share were $0.73, compared with $0.46 in the fourth quarter of fiscal 2025, an increase of 58.7%. The company said the increase was primarily driven by higher road transportation fuel gross margins, positive organic growth in convenience activities and the contribution from acquisitions.
Merchandise sales continue to grow
Total merchandise and service revenues reached $4.5 billion during the fourth quarter, an increase of 7.7%. Same-store merchandise revenues increased:
- 3.4% in the United States
- 1.1% in Europe and other regions
Same-store merchandise revenues decreased 0.9% in Canada.
Consolidated same-store merchandise revenues increased 2.2%. According to the company, growth in the United States and Europe was driven by continued growth in the other nicotine products and packaged beverages categories.
Merchandise and service gross margin increased:
- To 34.4% in the United States, up 0.5 percentage points
- To 39.6% in Europe and other regions, up 1.0 percentage point
In Canada, merchandise and service gross margin was 33.5%, a decrease of 0.6 percentage points. The company said the U.S. improvement was driven by strong execution, retail price optimization and vendor partnerships. In Europe and other regions, the increase was driven by changes in product mix.
Fuel margins increase across all regions
Same-store road transportation fuel volumes decreased:
- 2.1% in the United States
- 4.4% in Europe and other regions
In Canada, same-store road transportation fuel volumes increased 2.0%. Road transportation fuel gross margins increased in all regions:
- 52.44 cents per gallon in the United States, up 9.17 cents
- US 13.44 cents per litre in Europe and other regions, up US 3.87 cents per litre
- CA 17.28 cents per litre in Canada, up CA 3.23 cents per litre
The company stated that fuel margins were "noticeably strong during the fourth quarter, driven by the volatility in commodity markets and amplified by the advantages of our integrated fuel supply chain."
Revenue reaches $19.5 billion
Fourth-quarter revenues were $19.5 billion, up 19.8% compared with the fourth quarter of fiscal 2025.
According to Couche-Tard, the increase was mainly attributable to:
- Higher average road transportation fuel selling prices
- The contribution from acquisitions
- The impact from the translation of European operations into U.S. dollars
- Organic growth in convenience activities
These factors were partly offset by softness in fuel demand. Gross profit reached $3.5 billion during the fourth quarter, an increase of 19.4%.
The company attributed the increase primarily to:
- Higher road transportation fuel gross margins
- Contributions from acquisitions
- Organic growth in convenience activities
Merchandise and service gross profit increased by $135.4 million compared with the fourth quarter of fiscal 2025.
Road transportation fuel gross profit increased by $418.5 million compared with the corresponding quarter last year.
Expense growth remains below inflation
Chief financial officer Filipe Da Silva said:
"We delivered a solid fourth quarter to close the year, driven by the quality of our underlying results, even excluding the impact of certain favourable items. Disciplined execution enabled us to maintain our normalized growth of expenses below inflation, protecting profitability while continuing to invest in the business to support improved return metrics. Our results highlight the consistency and durability of our earnings and reinforce our confidence as we continue delivering against our Core + More strategy into the new fiscal year."
Normalized growth of expenses was 2.6% during the fourth quarter and 3.1% for fiscal 2026.
The company said expense growth was driven by inflationary pressures and investments supporting strategic initiatives, partly offset by efforts to control expenses.
Store development continues
During fiscal 2026, Couche-Tard completed:
- 103 new-to-industry store openings
- 27 relocated or reconstructed stores
This brought total completed projects to 130 stores during the fiscal year. As of April 26, 2026, another 34 stores were under construction. During the fourth quarter, the company completed construction of 37 stores and relocated or reconstructed 13 stores.
Couche-Tard also acquired three company-operated stores during the quarter and acquired three fuel terminals in Germany. At fiscal year-end, the company operated 14,563 sites and had 2,704 Circle K branded sites under licensing agreements, bringing its total network to 17,267 sites.
Approximately two years after acquiring certain European retail assets from TotalEnergies, Couche-Tard reported an annual synergy run rate of approximately €61.0 million, equivalent to $71.4 million as stated in the press release.
The company said the run rate is expected to reach:
- €120.0 million ($140.5 million) in fiscal 2027
- €170.0 million ($199.1 million) in fiscal 2029
According to the company, the synergies are expected to result in reductions in operating expenses, reductions in cost of sales and sales growth from the introduction of company best practices.
Fiscal 2026 highlights
For fiscal 2026, Couche-Tard reported:
- Diluted net earnings per share of $3.37, compared with $2.71 in fiscal 2025
- Adjusted diluted net earnings per share of $3.10, compared with $2.71 in fiscal 2025
- Return on capital employed of 13.7%, compared with 12.2% in fiscal 2025
The company repurchased 30.0 million shares during fiscal 2026 for $1.6 billion.
The annual dividend declared for fiscal 2026 increased by 10.5%, from CA 76.00 cents to CA 84.00 cents per share.
Financing activity
On April 21, 2026, Couche-Tard issued euro-denominated senior unsecured notes totalling €750.0 million, equivalent to $882.0 million as stated in the press release.
The notes carry a coupon rate of 3.90% and mature in 2033.
The company said the net proceeds of $875.8 million were used to repay outstanding indebtedness, including repayment of euro-denominated senior unsecured notes maturing in May 2026.
Outlook
Couche-Tard reported growth in merchandise revenues, fuel margins, adjusted earnings and store development during fiscal 2026 while continuing to invest in its network and strategic initiatives.
Management said it remains focused on executing its "Core + More" strategy as it enters the new fiscal year.
