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LAVAL, Quebec-- Alimentation Couche-Tard Inc. announced plans to start paying a dividend after reporting fiscal second-quarter profit climbed 45 percent because of rising gasoline prices, reported Bloomberg.
Net income in the period ended Oct. 9 rose to $55.5 million, or 27 cents a share, compared with $38.3 million, or 19 cents, a year earlier. Sales rose 30 percent to $2.39 billion. The quarterly dividend, Couche-Tard's first, will be 2.5 Canadian cents a share and is payable on Dec. 1, the company said in the Bloomberg report.
After fuel costs were subtracted, the company earned 17.05 cents a gallon on gas, about a third more than a year ago. Gasoline sold in the United States for an average of $2.62 a gallon in the quarter, a 41-percent rise.
According to the report, investors have urged the company to start a dividend for the past two years.
"Gas prices have been slow to fall at the pump, although wholesale prices have come down," Blackmont Capital Inc. analyst David Hartley told Bloomberg. "The ones making the money are the merchants."
Hartley said he was expecting net income of about 25 cents a share. That also was the average estimate of five analysts surveyed by Thomson Financial. Thomson Financial refused to provide clarification on whether the estimates include one-time costs or gains, reported Bloomberg.
Couche-Tard runs 4,853 stores in the United States and Canada. Sixty-two percent of the stores sell gasoline. More than three-quarters of the company's total revenue came from the United States, where Couche-Tard bought 1,663 Circle K stores and gas stations from ConocoPhillips for $830 million two years ago.