INVESTORS PRESENTATION

Transcription

1 ALIMENTATION COUCHE-TARD INC. INVESTORS PRESENTATION September 2017

2 FORWARD-LOOKING INFORMATION AND CAUTIONARY LANGUAGE This presentation and the accompanying oral presentation contain forward-looking statements within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as projected, estimate, may, anticipate, believe, expect, plan, intend or similar words suggesting future outcomes or statements regarding an outlook. All statements other than statements of historical fact contained in these slides are forward-looking statements. Forward-looking statements involve numerous assumptions, risks and uncertainties. A variety of factors, many of which are beyond Alimentation Couche-Tard Inc. s ( Couche-Tard ) control, may cause actual results to differ materially from the expectations expressed in its forward-looking statements. These factors include, but are not limited to, the effects of the integration of acquired businesses and the ability to achieve projected synergies, fluctuations in margins on motor fuel sales, competition in the convenience store and retail motor fuel industries, foreign exchange rate fluctuations, and such other risks as described in detail from time to time in documents filed by Couche-Tard with securities regulatory authorities in Canada, including those risks described in Couche-Tard s management s discussion and analysis (MD&A) for the year ended April 30, Couche-Tard s MD&A and other publicly filed documents are available on SEDAR at Unless otherwise required by law, Couche-Tard does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by it or on its behalf. No financial information presented in this presentation as of a date more recent than April 30, 2017 has been audited. While the information contained in this presentation is believed to be accurate, Couche-Tard expressly disclaims any and all liability for any losses, claims or damages of whatsoever kind based upon the information contained in, or omissions from, this presentation or any oral communication transmitted in connection therewith. In addition, none of the statements contained in this presentation are intended to be, nor shall be deemed to be, representations or warranties of Couche-Tard and its affiliates. Where the information is from third-party sources, the information is from sources believed to be reliable, but Couche-Tard has not independently verified any of such information contained herein. This presentation is not, and under no circumstances is to be construed as, a prospectus, an offering memorandum, an advertisement or a public offering of securities. Under no circumstances should the information contained herein be considered an offer to sell or a solicitation of an offer to buy any securities. 2

3 COMPANY REPRESENTATIVES Claude Tessier Chief Financial Officer Mathieu Descheneaux Vice President Finance 3

4 AGENDA 1. Company Highlights 2. Ambitions & Strategy 3. Network Development 4. Value Creation & Financial Review 5. CST Case Study 4

5 KEY DATA Listed on the Toronto Stock Exchange ATD.B Market Cap 1 Approx. CA$34B Revenue US$37.9B Fiscal Year US$9.8B Q YTD 2 (+16.9%) Gross Profit US$6.5B Fiscal Year US$1.7B Q YTD 2 (+14.4%) EBITDA US$2.4B Fiscal Year US$0.7B Q YTD 2 (+12.2%) Number of stores 3 North America Europe International Net Debt / Leverage 4 FY2017 Q Ratings S&P Moody s 13,974 9,471 2,754 1,749 US$2.7B / 1.09x US$6.4B / 2.31x BBB (Stable outlook) Baa2 (Stable outlook) 5 1.Close as at September 8, Fiscal Year ended 30/04/2017 and Q YTD being 12 weeks to 23/07/ Includes Couche-Tard s Company-Owned/Dealer-Operated and Dealer-Owned-Dealer-Operated sites as at July 23, Long term interest-bearing debt, net of cash and cash equivalents and temporary investments divided by EBITDA adjusted for non-recurring items. Refer to the Corporation s MD&As for more details.

6 ALIMENTATION COUCHE-TARD INC. COMPANY HIGHLIGHTS

7 WHO WE ARE Couche-Tard is a Canada based group and a world leader in the convenience store and road transportation fuel retail sector In North America, Couche-Tard is the largest independent convenience store operator in terms of number of company-operated stores. In Europe, Couche-Tard is a leader in convenience store and road transportation fuel retail in Scandinavia, Ireland and the Baltic countries, with a significant presence in Poland. North America 9,471 convenience stores throughout North America, including 8,129 stores offering road transportation fuel in all 10 Canadian provinces and 42 U.S. States, and employing about 95,000 people. More than 1,200 locations in the U.S. supplied with road transportation fuel through CrossAmerica Partners LP. Europe 2,754 stores, comprising a broad retail network across Scandinavia (Norway, Sweden and Denmark), Ireland, the Baltics (Estonia, Latvia and Lithuania), Poland and Russia. Including employees at its branded franchise stations, about 25,000 people work in its retail network, terminals and service offices across Europe. International More than 1,700 stores operated by independent operators under the Circle K banner in 13 other countries or regions worldwide which brings the number of sites in Couche-Tard s network to over 15,000. Store count as at July 23,

8 COMPANY HISTORY 1980 Start of operations with the opening of a first convenience store located in Laval, Québec. 80 s-90 s Consolidation of the Canadian market First breakthrough of Couche-Tard in the United States : acquisition of the assets of Johnson Oil Company, Inc., owner of 225 Bigfoot stores, all located in the U.S. Midwest Acquisition of The Circle K Corporation from ConocoPhillips Company that operates 1,663 Circle K corporate stores located in 16 States and has a franchising or licensing relationship with 627 additional stores in the U.S. and worldwide Couche-Tard becomes an active player in the US market consolidation Acquisition of Statoil Fuel & Retail, a leading Scandinavian road transport fuel retailer. Statoil Fuel & Retail operates a broad retail network across Scandinavia (Norway, Sweden, Denmark), Poland, the Baltics (Estonia, Latvia, Lithuania) and Russia with approximately 2,300 stores, the majority of which offer fuel and convenience products while the others are automated (fuel only) stations Acquisition of The Pantry Inc., a leading convenience store operator in the southeastern United States and one of the largest independently operated convenience store chains in the United States. The Pantry operates approximately 1,500 stores in 13 States under select banners, including Kangaroo Express, its primary operating banner Couche-Tard launches its global Circle K brand, the world s preferred destination for convenience and fuel Acquisition of Topaz, the leading convenience and fuel retailer in Ireland, made up of 444 stores Couche-Tard signs an agreement with Imperial Oil to acquire 278 Esso-branded Canadian fuel and convenience sites located in the provinces of Ontario and Québec Couche-Tard enters into a merger agreement to acquire 100% of the outstanding shares of CST Brands, Inc. (NYSE:CST) which stands as the 4 th largest chain in North America with 1,146 locations in the US due to a strong presence in Texas and 873 locations in Canada Couche-Tard enters into a merger agreement to acquire 100% of the outstanding shares of Holiday Stationstores, Inc. an important convenience store player in the U.S. Midwest region, with 522 stores, a food commissary and a fuel terminal in Newport, Minnesota, which supplies one third of the stations. 8

9 A DISCIPLINED CONVENIENCE STORE OPERATOR AND INTEGRATOR Broad Geographic Footprint with Leading Market Positions Combines world class retailer and leading C-store operator with geographically diverse footprint Strong banners, with our new global convenience brand Circle K TM and our fuel banner Ingo at unmanned stations in Scandinavia Superior Product Offerings Increasing focus on private label, fresh food products and famous for concepts Industry leading merchandise gross margin Track Record of Highly Disciplined Growth and Debt Reduction Attractive Sector Dynamics Powerful Financial Results Proven integrator Well positioned to lead further consolidation in fragmented industry Committed to investment grade post acquisition Steady industry performance throughout downturns with strong projected growth C-store sector well positioned to gain share from traditional food retail Industry-leading returns in recessions Strong and consistent financial performance throughout all economic cycles Prolific history of positive same-store comps and 22.5% Return on equity 1 Significant FCF generation ( ) CAGR of 17% Attractive Synergy Potential Proven ability to extract significant synergies from acquisitions Transferring best practices across entire platform Disciplined Management Culture Management team with strong track record and founders have 22% equity ownership as of April 30, 2017 Management and Board need to hold a multiple of their salary in Shares Decentralized operating model (1) As of April 30,

10 EXPERIENCED MANAGEMENT TEAM Alain Bouchard Founder and Executive Chairman of the Board On September 24, 2014, Mr. Bouchard stepped down as President and Chief Executive Officer and took on a new role as Founder and Executive Chairman of the Board of Directors. Brian P. Hannasch President and Chief Executive Officer President and Chief Executive Officer since Previously Chief Operating Officer since 2010 and Senior Vice-President, U.S. Operations from 2008 to Claude Tessier Chief Financial Officer Claude Tessier, CPA, CA, is Couche-Tard s Chief Financial Officer since January Beforehand, Mr. Tessier was President of the IGA Operations Business Unit part of Sobeys since Jean Bernier Group President Global Fuels and North-East Operations Appointed Group President Global Fuels and North-East Operations on July 30, He has over 25 years of experience in the convenience store, fuel and grocery store sectors of the retail industry. Geoffrey C. Haxel Senior Vice-President, Operations Appointed Senior Vice- President, Operations in January He was formerly Vice-President, Operations, U.S. Arizona Region since December Dennis Tewell Senior Vice-President, Operations Appointed Senior Vice- President, Operations in June Prior to his current appointment, He held the position of Vice- President, Worldwide Franchise as he joined Couche-Tard in January Darrell Davis Senior Vice-President, Operations Appointed Senior Vice- President, Operations in May Previously, he had been Vice-President Operations, Florida since March Alex Miller Senior Vice President, Global Fuels Appointed Senior Vice- President Global Fuels on February 16, Previously, he had been Vice-President North American Fuels since October He joined Couche-Tard in January 2012 as Director of Operations Midwest. Jacob Schram Group President, European Operations Appointed Group President, European Operations in June, He was formerly Chief Executive Officer for Statoil Fuel & Retail from October 1st, He joined Statoil in Jørn Madsen Executive Vice-President, Central & Eastern Europe Appointed Executive Vice- President, Central & Eastern Europe on October 1, He was formerly Vice President for country operations in Statoil Energy & Retail since He joined Statoil in Hans-Olav Høidahl Executive Vice-President, Scandinavia Appointed Executive Vice- President, Scandinavia on October 1, He was formerly Vice President for Energy Europe in the Statoil Group since

11 NORTH AMERICAN NETWORK Largest independent convenience store operator in the US in terms of number of company operated stores In the US, the convenience sector is fragmented and in a consolidation phase Couche-Tard acquired The Pantry in March 2015, one of the largest independently operated convenience stores in the US On June 28, 2017, Couche-Tard acquired 100% of the outstanding shares of CST Brands, the 4 th largest chain in North America. Leader in the Canadian convenience store industry In Canada, the convenience store sector is dominated by a few major players including Couche-Tard and integrated oil companies. Some of the latter are selling, or expected to sell their retail assets. On September 7, 2016, Couche-Tard received the approval from the Canadian Competition Bureau to acquire from Imperial Oil Limited 279 sites in Ontario and Quebec and finalized the integration of these sites during the third quarter of fiscal Canada Couche-Tard Circle K Mac s, Esso & CST (will be rebranded to Circle K) US Circle K Kangaroo Express & CST (will be rebranded to Circle K) Total network of 9,471 stores in North America As at July 23,

12 EUROPEAN NETWORK Leader in convenience store and road transportation fuel retail in the Scandinavian and Baltic countries and Ireland The European convenience store sector is often dominated by a few major players, including integrated oil companies. Some of these are in the process of selling, or are expected to sell their retail assets Key brands: Circle K Ingo Topaz Being rebranded from Statoil Unmanned Scandinavian stations Will be rebranded to Circle K 2,754 stores in 9 countries or regions in Europe As at July 23,

13 INTERNATIONAL PRESENCE Central / South America Asia Mexico 461 United Arab Emirates 31 China 86 Costa Rica 5 Honduras 25 Egypt 9 Macau 30 Vietnam 246 Guam 13 Hong Kong Philippines Convenience stores operated by independent operators under the Circle K brand License agreement to use the brandname Circle K Malaysia 6 Indonesia 489 More than 1,700 licensed Circle K stores in Asia, Costa Rica, Egypt, Honduras, Mexico and U.A.E As at July 23,

14 CONSOLIDATED NETWORK RECAP Canada U.S. Europe International presence Total COCO (1) 1,602 5,759 1,968-9,329 CODO (2) DODO (3) ,050 Franchise/Affiliated (4) ,104 Licensed (5) ,749 1,749 Total 2,231 7,240 2,754 1,749 13,974 Of which: Automats # With fuel 1,194 6,935 2,752-10,881 % With fuel 54% 96% 99.9% - 78% (1) Sites for which the real estate is controlled by Couche-Tard (through ownership or lease agreements) and for which the stores (and/or the service stations) are operated by Couche-Tard or one of its commission agents. (2) Sites for which the real estate is controlled by Couche-Tard (through ownership or lease agreements) and for which the stores (and/or the service stations) are operated by an independent operator in exchange for rent and to which Couche-Tard sometimes provides road transportation fuel through supply contracts. Some of these sites are subject to a franchise agreement, licensing or other similar agreement under one of our main or secondary banners. (3) Sites controlled and operated by independent operators to which Couche-Tard supplies road transportation fuel through supply contracts. Some of these sites are subject to a franchise agreement, licensing or other similar agreement under one of our main or secondary banners. (4) Stores operated by an independent operator through a franchising, licensing or another similar agreement under one of our main or secondary banners. (5) Stores operated by independent operators under the Circle K banner in other countries or regions worldwide. As at July 23, Excludes CrossAmerica Parners LP 14

15 COUCHE-TARD IS A WORLD LEADER Couche-Tard is a leading global convenience store operator with EBITDA of $2.5 billion Well diversified across geographies Focus on growing high margin categories REVENUES Merchandises and services Motor Fuel Other $10,971M $27,213M $1,147M Total $39,331M Revenues By Products LTM Q Canada 17% Europe 12% US 71% Europe 25% Canada 13% US 62% US 1% Canada 2% Europe 97% Motor fuel 69% Other 3% Merchandise and services 28% GROSS PROFITS Merchandises and services Motor Fuel Other $3,780M $2,700M $221M Total $6,701M Gross Profit By Products LTM Q Canada 17% Europe 14% US 69% Europe 35% Canada 11% US 54% Europe 84% US 7% Canada 9% Motor fuel 40% Other 3% Merchandise and services 57% Financial data presented for the LTM as of Q

16 COUCHE-TARD IS A WORLD LEADER REVENUES U.S. Canada Europe $24,792M $5,444M $9,095M Total $39,331M Revenues By Geography LTM Q Motor fuel 68% Other 0.1% Merchandise and services 32% Motor fuel 65% Other 0.4% Merchandise and services 34% Other 12% Merchandise and services 14% Motor fuel 74% Europe 23% Canada 14% US 63% GROSS PROFIT U.S. Canada Europe $4,066M $966M $1,669M Total $6,701M Gross Profit By Geography LTM Q Motor fuel 36% Other 0.4% Merchandise and services 64% Motor fuel 32% Other 2% Merchandise and services 66% Other 11% Motor fuel 57% Merchandise and services 32% Canada 14% Europe 25% US 61% Financial data presented for the LTM as of Q

17 REVENUE & GROSS PROFIT Gross Profit is the more accurate reflection of our business operations Revenue (in millions of US dollars) 6 11% CAG 37,962 37,905 39,331 35,543 2,800 34,530 34,145 1,147 2,676 1,126 1, ,980 26,054 27, ,209 23,306 25,271 24,282 16,375 6,599 7,596 7,953 8,276 10,072 10,724 10, LTM Q Merchandise Motor Fuel Other Gross profit (in millions of US dollars) 17% CAG 4,988 4, ,701 6,482 6, , ,587 2,700 2,440 2,129 1,888 2,975 1, ,431 3,682 3,780 2,599 2,699 2,806 2,182 Revenue includes road transportation fuel revenues which is the dollar amount of sales Revenue can therefore change with movements in the average selling price of road transportation fuel In fiscal 2017, road transportation fuel revenue represented about : 63% of total revenue in Canada 68% of total revenue in the US, and 74% of total revenue in Europe Yet, road transportation fuel gross margins represented only about 40% of Couche-Tard s overall gross profit Gross profit represents our income after cost of sales LTM Q Merchandise Motor Fuel Other CAG: Five-year compounded annual growth - fiscal 2017 over fiscal

18 A HISTORY OF STRONG FINANCIAL PERFORMANCE Gross Profit Same Store Sales Growth % CAG Merchandise sales (in millions of US Dollars) US 2.7% 1.0% 3.8% 3.9% 4.6% 2.0% 4,610 4,988 5,268 6,082 6,482 Europe 1.6% 2.0% 2.8% 3.5% Canada 2.8% 2.0% 1.9% 3.4% 2.9% 0.1% 2,975 Motor Fuel Volume US 0.1% 0.6% 1.7% 3.4% 6.6% 2.6% Europe 2.5% 2.4% 2.6% 1.0% Canada -0.9% 0.0% 1.3% -0.1% 0.9% -0.3% EBITDA Free Cash Flow (1) 23% CAG 17% CAG (in millions of US Dollars) (in millions of US Dollars) 841 1,376 1,640 1,876 2,331 2, , Proven track record of consistent growth 18 (1) Free Cash Flow defined as: EBITDA minus total CAPEX (excluding price paid for acquisitions), net dividends paid, net interests paid and net income taxes paid plus proceeds from disposal.

19 STOCK PERFORMANCE COMPARED TO PUBLIC COMPETITORS AND RETAIL INDUSTRY 800% 800% 700% 600% 500% 400% 300% 200% 100% 0% 700% 600% 500% 400% 300% 200% 100% 0% Couche-Tard C-Stores Grocery Home Improv. Drugstores Mass Merch. Dollar Stores Couche-Tard Delek Murphy Casey's Marathon CST Brands(1) Source: Yahoo Finance. As of September 1, (1) On June 28, 2017, ACT acquired CST Brands. 19

20 ALIMENTATION COUCHE-TARD INC. AMBITIONS & STRATEGY

21 OUR VISION TO BECOME THE WORLD S PREFERRED DESTINATION FOR CONVENIENCE AND FUEL 21

22 OUR GLOBAL BRAND GET HIGH DEF 22

23 GLOBAL CIRCLE K BRAND On September 22, 2015, Couche-Tard announced the creation of a new, global convenience brand, Circle K TM The existing Circle K is already Couche-Tard s largest and most international brand. It can be seen today serving the needs of customers in 22 countries around the world The new Circle K brand will replace the existing brands: Circle K, Statoil, Mac s, Kangaroo Express, Topaz Couche-Tard has chosen to retain the company s founding Couche-Tard retail brand in the province of Québec, Canada The new Circle K brand will also appear on licensed stores worldwide The Company s goal in the coming years is to have a single convenience retail brand across our worldwide network Before After Before After 23

24 REBRANDING STATUS Project well under way: More than 1,800 stores (1) in North America and 1,300 stores (1) in Europe are now proudly displaying our new global convenience brand Circle K Scandinavia market already completed Outstanding success Baltics, Poland and Canada underway United States ongoing (1) As of July 23,

25 NEW GLOBAL BRAND SAME APPROACH TO SERVING OUR CUSTOMERS SUPER GLOBAL SUPER LOCAL 25

26 26 THE PROMISE BEHIND THE BRAND

27 27 MAKING IT EASY BRAND PILLARS SUPPORTING OUR PROMISE

28 BRAND PILLARS FAST & FRIENDLY SERVICE Recruitment & Hiring Employee engagement Employee turnover Service standards Training Physical appearance 28

29 BRAND PILLARS EASY VISTS Predictable in-store and forecourt experience Clean #2 reason impacting shoppers decision of which c-store to visit (after location) In-stock Out-of-stock is #1 reason for missed sale in c-stores Fast transaction 88% of US adults want their store checkout experience to be faster Source Convenience store news 29

30 BRAND PILLARS PRODUCTS FOR PEOPLE ON THE GO Food Hot Dispensed Beverages Cold Dispensed Beverages Car Wash Private Label Fuel 30

31 31 CONVENIENCE KEY CATEGORIES

32 PRIVATE LABEL Better value proposition to customers Increased Circle K brand awareness Higher penny profit 32

33 FUEL Consumer experience Payment & Loyalty Pillars Product Differentiation 33 Pricing

34 ALIMENTATION COUCHE-TARD INC. NETWORK DEVELOPMENT

35 NEW FORMAT DEVELOPMENT Larger fuel offering Food service expansion High traffic locations Focus on site layouts & critical dimensions Circle K Branded store & customized fuel branding Standardization of building, interior layout & image 35

36 NEW SITES We completed the construction, relocation or reconstruction of 91 stores during fiscal 2017 and 23 since the beginning of fiscal

37 ALIMENTATION COUCHE-TARD INC. VALUE CREATION AND FINANCIAL REVIEW

38 OUR FOUR PILLARS OF VALUE CREATION THE EQUATION Value Drivers Protect Value & Enable Growth Organic Growth Acquisitions Cost Discipline Capital Structure & Financial Discipline Value Creation 38

39 ORGANIC GROWTH Construction, relocation or reconstruction of stores Focus on customers needs and respond to market trends Emphasize on key categories Food, coffee, cold beverages, fuel and car wash Branding Organic Growth Innovation and technology Private label Execution Continuous improvement 39

40 ORGANIC FISCAL 2017 TOP-LINE GROWTH Europe SSS +3.5% Canada SSV (-0.3)% Europe SSV +1.0% Organic Growth Canada SSS +0.1% US SSS +2.0% SSS: Same-store merchandise sales SSV: Same-store volume US SSV +2.6% 40

41 ORGANIC SUSTAINABLE TOP-LINE GROWTH 6,599 Merchandise & Service Sales (millions of US dollars) 10% CAG 7,596 7,953 8,276 10,072 10,724 4,613 Road Transportation Fuel Volume (millions of gallons) 21% CAG 6,945 7,626 8,135 10,502 11, % Same-store Merchandise Revenue Growth 5% Road Transportation Fuel Same-Store Volume Growth -5% US Europe Canada -5% US Europe Canada CAG: Five-year compounded annual growth - fiscal 2017 over fiscal

42 ORGANIC GROWTH LEADING TO STRONG MARGINS IN ALL GEOGRAPHIES Europe 42.4% Organic Growth Canada 33.8% United States 33.2% FISCAL 2017 MERCHANDISE & SERVICE MARGIN 42

43 NO CLEAR CORRELATION BETWEEN FUEL PRICES & MARGINS U.S Market (1) Q1 LTM No clear correlation between fuel selling price and margins Our margins are not directly impacted by lower fuel selling prices Lower fuel prices leave customers more money in their pockets for their in-store shopping Motor fuel price (US dollars per gallon) Motor fuel margin (US cents per gallon) U.S Fuel Margins (CPG) (1) Canadian Fuel Margins (CPL) (1) Norwegian Fuel Margins (NOK PL) (2) Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q US margins (CPG) Trend (1) For company-operated stores only (2) For total network 43 - Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q CA margins (CPL) Trend NOK margins per litre Trend Swedish Fuel Margins (SEK PL) (2) Danish Fuel Margins (DKK PL) (2) Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q SEK margins per litre Trend DKK margins per litre Trend

44 US FUEL MARGINS TRENDS Year-over-year volatility Long term trend is up ACT Historical US Fuel Margins (CPG) US Industry Historical Fuel Margins (CPG) CAG Large integrated oil companies out of retail. Market dominated by pure play retailers who need to maintain and grow margins in order to maintain profitability Higher premium fuel penetration Large integrated oil companies out of retail. Market dominated by pure play retailers who need to maintain and grow margins in order to maintain profitability Higher premium fuel penetration Improved, more sophisticated pricing strategies Improved, more sophisticated execution Improved supply conditions ACT: Fiscal Year / Industry: Calendar Year Sources: ACT reporting documents and NACS SOI Annual Report. 44

45 ACQUISITIONS Smart, disciplined acquisition strategy Spotting the right opportunities and striking the right deals at the right price Deleveraging Identify the right opportunities Acquisitions Realization of available synergies Strike the right deal at the right price Swift and efficient integration 45

46 PROVEN TRACK RECORD OF SUCCESSFUL ACQUISITIONS Garvin oil Revenue ($) Pump N Shop Winners Sterling Stores Compac Food Stores Net Debt/ Adjusted EBITDA (1) Stores Acquired (2) (3) 1.0 (3) 1.1 (3) 1, , , , (3) Agreement signed for additional stores acquisition in fiscal (1) This ratio represents the following calculation: long term interest-bearing debt, net of cash and cash equivalents and temporary investments divided by EBITDA (Earnings before Interest, Tax, Depreciation, Amortization and Impairment) adjusted for specific items. Refer to the Corporation s MD&As for more details. (2) Including full-year results for SFR. (3) Pro forma The Pantry for 2015, Topaz for 2016, ESSO for 2017 and CST for 2018.

47 EXCEPTIONAL DELEVERAGING TRACK RECORD ACT is committed to maintaining a strong balance sheet and sustaining its investment grade credit rating Circle K Acquisition No Transformational Acquisition SFR Acquisition The Pantry, Topaz and IOL stores Acquisitions Adj. Net Debt / Adj. EBITDAR (4) $804M Acquisition 4.2 2,453 Stores Acquired 1,017 Stores Acquired 2,299 Stores Acquired 2,269 Stores Acquired Rapid deleveraging after transformational acquisition Strong credit metrics for several years $3.6B Acquisition 3.6 Leverage post SFR acquisition lower than Circle K $1.7B Acquisition $1.7B $0.3B Acquisition Acquisition F2004 F2005 F2006 F2007 F2008 F2009 F2010 F2011 F2012 Pro Forma F2013 F2014 F2015 (1) F2016 (2) F2017 (3) Demonstrated track record of rapid deleveraging after acquisitions 47 (1) Pro forma The Pantry (2) Pro forma Topaz (3) Pro forma Esso (4) This ratio represents the following calculation: long-term interest-bearing debt, net of cash and cash equivalents and temporary investments divided by EBITDA (Earnings Before Interest, Tax, Depreciation, Amortization and Impairment) adjusted for specific items.

48 DELIVERING ON SYNERGIES THROUGH OUR ACQUISITIONS Synergies Statoil Fuel and Retail Target: $150M - $200M Realized: >$200M Synergies CST Brands, Inc Initial target for the first 36 months: $150M $200M Synergies The Pantry Target for the first 24 months: $125M Realized: >$125M 48

49 COST CONTROL PART OF OUR DNA 1.9% Year-over-year expense growth -0.9% 0.2% 0.8% 1.5% 2.3% Scalable Organization, Systems & Processes Disciplined Culture Cost Control 5-year Average : +1.0% Economies of Scale Cost Efficient Systems 49

50 CAPITAL STRUCTURE & FINANCIAL DISCIPLINE Competitive cost of debt Rapid deleveraging after acquisitions Well spread maturities Disposal of non-core assets Cost Discipline Access to liquidities Cash and credit facilities Dividend growth Careful allocation of capital 50

51 STRONG EBITDA TO FCF CONVERSION 17% CAG Strong FCF Growth (millions of US dollars) Capital Investment primarily consists of the investment in property and equipment net of disposals and the ongoing improvement of our network: Construction of new stores Relocation and construction of existing stores Replacement of equipment Information technology Rebranding 2016 CAPEX increased significantly because of the integration of more than 1,500 Pantry stores. In addition, 2017 CAPEX increased due to the integration of the acquired stores from Esso and Dansk Fuel. Couche-Tard generates strong cash flows, which allows rapid deleveraging to support a strong credit profile. Capex spend has averaged about 30% of EBITDA since CAG: Five-year compounded annual growth - fiscal 2017 over fiscal (1) 2015 Free cash flow includes the proceeds from the disposal of the aviation fuel business. (2) 2016 Free cash flow includes the proceeds from the disposal of the lubricants business.

52 STRONG CAPITAL STRUCTURE & FINANCIAL DISCIPLINE Adjusted Leverage Ratio (2) 3.07:1 Free Cash Flow (in million dollars US) Average Cost of Debt 2.7 % Investment Grade Credit Profile FCF +17 % CAG , Free Cash Flow ~$1.0 Billion Capital Structure & Financial Discipline $2.5 Billion and CA $700M of senior unsecured notes (3) Q1 LTM ~$1.5 Billion available under credit facilities ~$1.0 Billion in Cash Standard&Poors: BBB (Stable) Moody s: Baa2 (Stable) 52 (1) CAG: Five-year compounded annual growth - fiscal 2017 over fiscal (2) Long term interest-bearing debt plus the product of eight times rent expense, net of cash and cash equivalents and temporary investments divided by EBITDAR (Earnings before Interest, Tax, Depreciation, Amortization, Impairment and Rent expense) adjusted for specific items. Refer to the Corporation s MD&As for more details. (3) Issuance of the notes occurring subsequent to the end of the first quarter.

53 RESULT OF THE VALUE CREATION EQUATION : ADJUSTED DILUTED NET EARNINGS PER SHARE AND RETURN ON EQUITY GROWTH Adjusted Diluted Net Earnings per Share (USD) Value Creation Return on Equity 5-year compounded annual growth +22 % % 21.5% 22.6% 24.9% 27.0% 22.5%

54 RESULT OF THE VALUE CREATION EQUATION : DIVIDEND GROWTH Dividends Paid US Millions 5-year compounded annual growth % Value Creation Dividend vs Free cash flow Q1 LTM FCF +17 % CAG , Quarterly dividend increased twice during fiscal 2016, from CA 5.50 per share to CA 7.75 per share, an increase of 41%. In the second quarter of fiscal 2017, the quarterly dividend increased to CA 9.00 per share (remained at CA 9.00 for the third and fourth quarters of fiscal 2017 as well as for the first quarter of fiscal 2018) Q1 LTM Free cash flow Dividend (1) CAG: Five-year compounded annual growth - fiscal 2017 over fiscal

55 RESULT OF THE VALUE CREATION EQUATION : STOCK VALUE GROWTH 5-Year Stock Performance 450.0% Value Creation 350.0% 250.0% 150.0% 50.0% -50.0% Variance ACT stock price (%) Variance TSX index (%) Source: Bloomberg. As of August 30,

56 SNAPSHOT CONTINUED GROWTH Q week period ended July 23, 2017 Merchandise same-store revenues United States +1.4% Europe +1.4% Canada (0.2%) Road transportation fuel same-store volume United States +0.4% Europe (0.3%) Canada (0.2%) Adjusted EBITDA $715.3M / +16.2% Adjusted Diluted Net Earnings per Share $0.67 / +17.5% Declared dividend per share 9.0 CA / +16.1% 56

57 ALIMENTATION COUCHE-TARD INC. ACQUISITIONS COMPLETED DURING FY18 Value Creation

58 CST TRANSACTION SUMMARY & OVERVIEW Transaction Summary Alimentation Couche-Tard Inc. ( ACT ) acquired 100% of the outstanding shares of CST Brands Inc. ( CST ), representing a total enterprise value of US $4.4 billion or approximately US $4.2 billion excluding the value of CST s equity participation in CrossAmerica Partners LP ( CAPL ). In order to obtain approval from the regulatory authorities, ACT sold to Parkland Fuel Corporation certain Canadian assets of CST, retaining 157 company-operated stores. In the United States, ACT has agreed to sell 70 sites to Empire Petroleum Partners, LLC., a transaction which should close at the end of August or in early September CST shareholders received cash consideration of US$48.53 per share Implied CST EBITDA multiple of 11.4x pre-synergies (1) Strategic & Financial Impact Transaction is expected to generate between US$150M and US$200M in annual cost synergies to be realized over the next 3 years Provides ACT control over CAPL s General Partner, ownership of associated Incentive Distribution Rights and equity stake of 20.5% in CAPL (CAPL is a distributor of branded and unbranded petroleum for motor vehicles in the U.S.) 41% 5% 54% Merch. & Serv. Fuel Gross Profits (2) 30% US 70% Canada Financing Couche-Tard financed the purchase of CST, including the refinancing of a portion of CST s existing indebtedness through: Capacity under existing revolving credit facilities New acquisition debt financing consisting of term loans of which a portion will be termed-out over time Available cash 58 (1) As of March 31, Excludes CrossAmerica Partners LP. (2) LTM for the period ended March 31, Excludes CrossAmerica Partners LP.

59 HIGHLIGHTS OF THE TRANSACTION Strategic Importance Acquisition Rationale Significant Synergies Potential Unique opportunity to acquire one of few remaining potential North American public targets exceeding 1,000 stores ACT to approach 9,500 North American stores Increased scale and leverage to create brand awareness and take advantage of merchandise and fuel procurement opportunities Operating model alignment Strong geographic Entry in Texas Void fill in US Southeast Strenghtening of existing network Talent acquisition and crosslearning potential Valuable real estate portfolio MLP structure Top-line upside Sharing of business awareness and best practices Cost optimization Optimization of supply conditions Optimization of distribution strategy Elimination of redundant costs 59

60 CST S RETAINED RETAIL NETWORK US Network 1,106 (1) company operated sites Canadian Network 157 (1) company operated sites (1) Net of the Canadian divested sites to Parkland and the U.S. divested sites to Empire Petroleum 60

61 PRO FORMA NORTH AMERICA FOOTPRINT COUCHE-TARD (1) US: 6,074 Canada: 2,087 CST (2) (3) US: 1,106 Canada: 157 Total US: 7,180 Canada: 2,244 North America: 9,424 U.S. store count by State (4) AL 161 FL 942 KY 113 MS 113 NC 426 TN 160 AZ 615 GA 388 LA 307 MO 124 OH 313 TX 882 AR 41 HI 5 ME 111 NV 34 OK 62 VT 7 CA 741 IL 256 MD 10 NH 60 OR 57 VA 56 CO 209 IN 237 MA 32 NJ 27 PA 29 WA 47 CT 3 IA 5 MI 29 NM 91 RI 1 WV 17 CST acquisition has allowed ACT to further diversify its operations and cash flow with a stronger presence in Texas, a fast growing and business friendly state. DE 1 KS 35 MN 17 NY 36 SC 309 WI 1 61 (1) Couche-Tard s store count as at June 30, (2) As at June 28, Excludes CrossAmerica Parners LP (3) Net of the Canadian divested sites to Parkland and the U.S. divested sites to Empire Petroleum (4) Pro forma store count by state. Includes Couche-Tard s Company-Owned/Dealer-Operated and Dealer- Owned/Dealer-Operated sites and excludes its RDK network operated under a joint venture.

62 PRO FORMA PROFILE FOR CST - FINANCIAL (billions of US Dollars) (1) (2) At Closing Pro Forma Pre-synergies EBITDA Contribution Revenues % of total 82% 18% 100% GP % % of total 85% 15% 100% EBITDA (3) % Store network 12,664 1,263 13,927 Debt 7.6 DEBT/EBITDA 2.4 Couche-Tard has strengthened its leadership position as a global convenience store operator with pro forma EBITDA of $3.1B 62 (1) Couche-Tard Fiscal 2017 results (2) After reflecting sale to Parkland and the sales agreement with Empire Petroleum, CST LTM financial results as at March 31, EBITDA includes a gain of $347 million from disposal of assets. (3) Includes Couche-Tard s Company-Owned/Dealer-Operated and Dealer-Owned/Dealer-Operated sites as well as its International licensees as at June 30, Excludes CrossAmerica Parners LP

63 CROSSAMERICA PARTNERS LP ACT brings CrossAmerica: Continuity with a general partner whose management culture is aligned with CrossAmerica Disciplined operator with best practices in acquisitions and integration Strong and consistent financial performance throughout all economic cycles Heightened focus on growing Free Cash Flow, with particular expertise in cost management Well capitalized with solid balance sheet; CST longterm debt is non-recourse to ACT Well positioned to lead further consolidation in fragmented industry Scale and global reach provides additional operational benefits Further strengthens relationship with many of our key suppliers Many turnkey branding and franchise programs that can complement dealer offerings Supports dealer health, which impacts fuel volume growth and additional rental income potential Wholesale operations with complementary geographic reach CrossAmerica U.S. Footprint (1) (1) CrossAmerica s network as of March 31,

64 EXCEPTIONAL SYNERGIES POTENTIAL TOP-LINE SYNERGIES COST SYNERGIES Increased brand penetration and awareness Leveraging key consumer Merchandise Supply Costs Value drivers, e.g. loyalty, digital marketing, etc Leveraging best practices and crosslearning opportunities Operating Expenses and Overhead $150M- $200M in pre-tax cost synergies Fuel Sourcing & Distribution Costs 64

65 INTEGRATION STRATEGY Evaluate talent pool and secure key employees Sale of CST Canadian assets Integrate operations & eliminate redundant costs Integrate support functions, technology and systems & eliminate redundant costs Roll-out key programs Polar Pop, Simply Great Coffee, ATMs, etc. Rebrand to Circle K/ Couche- Tard Transfer CST to existing ACT nonfuel agreements to unlock procurement synergies Renegotiate ACT existing agreements to leverage increased scale Review distribution strategy Build optimal strategy for CrossAmerica Partners LP Well planned and efficient integration strategy Similar to The Pantry 65

66 STRONG FINANCING PLAN Transaction financing needs of ~$4.8 billion (including acquisition costs), funded through Capacity under ACT s existing credit facilities New acquisition financing consisting of term loans three tranches with 1, 2 and 3 years terms ACT expects to repay for the term loans through Proceeds from the sale of Canadian assets Proceeds from sale of other non-core assets Term out to the bonds market Free cash flow Financing strategy will allow Access to capital at competitive conditions Flexibility to repay debt rapidly Capacity to modulate debt maturities Competitive, well balanced and flexible financing structure 66

67 ALIMENTATION COUCHE-TARD INC. SIGNIFICANT ACQUISITION AGREEMENT - SUBSEQUENT TO FY17

68 HOLIDAY SNAPSHOT On July 10, 2017, Alimentation Couche-Tard Inc. announced that it had signed an agreement with Holiday Companies to acquire all of the issued and outstanding shares of Holiday Stationstores, Inc. and certain affiliated companies ( Holiday ), an important convenience store player in the Upper Midwest United-States, with 522 stores, a food commissary and a fuel terminal in Newport, Minnesota, which supplies one third of the stations. 374 stores are operated by Holiday and 148 by franchisees Holiday has a strong car wash business with 221 locations Allows Couche-Tard to expand it s geographic footprint into the Upper Midwest U.S. and to gain a strong position in the Greater Twin Cities metropolitan area. The acquired sites are located in the following states: Minnesota, Wisconsin, Washington, Idaho, Montana, Wyoming, North Dakota, South Dakota, Michigan and Alaska. The transaction is anticipated to close in the fourth quarter of Couche-Tard s fiscal year 2018 and is subject to customary regulatory approvals and closing conditions. The Corporation expects to finance the transaction by using its available cash and existing credit facilities. 68

69 CONCLUSION Broad Geographic Footprint with Leading Market Positions Superior Product Offerings Track Record of Highly Disciplined Growth and Debt Reduction Attractive Sector Dynamics Powerful Financial Results Attractive Synergy Potential Disciplined Management Culture Poised for growth 69