CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

DISCLAIMER relevant and reasonable at the date that such statements are made. The forward-looking information contained herein is based on certain factors and assumptions as of the date By their very nature, forward-looking statements hereof and does not take into account the effect that require Management to make assumptions and are transactions or non-recurring or other special items subject to inherent risks and uncertainties, which announced or occurring after the statements are made give rise to the possibility that the Company’s have on the Company’s business. The Company does not undertake to update any forward-looking statements, assumptions, estimates, analyses, beliefs and whether written or oral, that may be made from time to opinions may not be correct and that the Company’s time by it or on its behalf, to reflect new information, expectations and plans will not be achieved. future events or otherwise, except as required by Examples of material assumptions and applicable securities laws. Management’s beliefs, which may prove to be incorrect, include, but are not limited to, the length, FORWARD LOOKING INFORMATION duration and impact of COVID-19, including measures adopted by governmental or public This document contains forward-looking statements authorities in response to the pandemic, the that reflect Management’s current expectations effectiveness of certain performance measures, relating to matters such as future financial current and future competitive conditions and the performance and operating results of the Company. Company’s position in the competitive environment, Forward-looking statements provide information the Company’s core capabilities, and expectations about Management’s current expectations and around the availability of sufficient liquidity to meet plans and allow investors and others to better the Company’s contractual obligations. understand the Company’s anticipated financial Management’s expectations with respect to the position, results of operations and operating Operational Efficiency program are based on a environment. Readers are cautioned that such number of assumptions relating to anticipated cost information may not be appropriate for other savings and operational efficiencies. Although the purposes. Company believes that the forward-looking information in this document is based on Certain statements other than statements of information, assumptions and beliefs that are historical facts included in this document may current, reasonable, and complete, such information constitute forward-looking statements, including, but is necessarily subject to a number of factors that not limited to, statements concerning Management’s could cause actual results to differ materially from current expectations relating to possible or Management’s expectations and plans as set forth assumed future prospects and results, the in such forward-looking statements. Some of the Company’s strategic goals and priorities, its actions factors, many of which are beyond the Company’s and the results of those actions and the economic control and the effects of which can be difficult to and business outlook for the Company. Often, but predict, include: (a) credit, market, currency, not always, forward-looking statements can be operational, liquidity and funding risks, including identified by the use of forward-looking terminology changes in economic conditions, interest rates or such as “may”, “will”, “expect”, “intend”, “believe”, tax rates; (b) the ability of the Company to attract “estimate”, “plan”, “can”, “could”, “should”, “would”, and retain high-quality employees for all of its “outlook”, “forecast”, “anticipate”, “aspire”, “foresee”, businesses, Dealers, Canadian Tire Petroleum “continue”, “ongoing” or the negative of these terms retailers, and Mark’s and SportChek franchisees, as or variations of them or similar terminology. well as the Company’s financial arrangements with Forward-looking statements are based on the such parties; (c) the growth of certain business reasonable assumptions, estimates, analyses, categories and market segments and the willingness beliefs and opinions of Management, made in light of customers to shop at its stores or acquire the of its experience and perception of trends, current Company’s consumer brands or its financial conditions and expected developments, as well as products and services; (d) the Company’s margins other factors that Management believes to be and sales and those of its competitors; (e) the changing consumer preferences and expectations

Page 1 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET related to eCommerce, online retailing and the For more information on the risks, uncertainties and introduction of new technologies; (f) the possible assumptions that could cause the Company’s actual effects on our business from international conflicts, results to differ from current expectations, refer to political conditions, and other developments the Company’s Management’s Discussion and including changes relating to or affecting economic Analysis for the quarter. Also refer to section 2.8 or trade matters as well as the outbreak of (Risk Factors) of the Company’s 2019 Annual contagions or pandemic diseases; (g) risks and Information Form, and all subsections thereunder, uncertainties relating to information management, as well as the Company’s other public filings, technology, cyber threats, property management available on the SEDAR (System for Electronic and development, environmental liabilities, supply Document Analysis and Retrieval) website at chain management, product safety, changes in law, www.sedar.com and at regulation, competition, seasonality, weather https://investors.canadiantire.ca. patterns, climate change, commodity prices and business disruption, the Company’s relationships with suppliers, manufacturers, partners and other third parties, changes to existing accounting pronouncements, the risk of damage to the reputation of brands promoted by the Company and the cost of store network expansion and retrofits; (h) the Company’s capital structure, funding strategy, cost management program, and share price; (i) the Company’s ability to obtain all necessary regulatory approvals; (j) the Company’s ability to complete any proposed acquisition; and (k) the Company’s ability to realize the anticipated benefits or synergies from its acquisitions. With respect to the statements concerning the Company’s Operational Efficiency program, such factors also include: (a) the possibility that the Company does not achieve the targeted annualized savings; (b) the possibility that the program results in unforeseen impacts to overall performance; (c) the possibility that the one-time costs and capital investments associated with the program are more significant than expected; and (d) the possibility that the Company does not achieve the expected payback during the anticipated timeframe for the severance, store closure and other related expenses recorded. Additional risks and uncertainties related to COVID- 19 are discussed in the Company’s Management’s Discussion and Analysis for the quarter. Management cautions that the foregoing list of important factors and assumptions is not exhaustive and other factors could also adversely affect the Company’s results. Investors and other readers are urged to consider the foregoing risks, uncertainties, factors and assumptions carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements.

Page 2 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

CORPORATE PARTICIPANTS 2020. A copy of the earnings disclosure is available on their website and includes cautionary language about Greg Hicks forward-looking statements, risks, and uncertainties President and Chief Executive Officer which also apply to the discussion during today's conference call. Gregory Craig Chief Financial Officer I would now like to turn the call over to Greg Hicks, President and CEO. Greg.

CONFERENCE CALL PARTICIPANTS Greg Hicks, President and Chief Executive Officer

Patricia Baker Thank you, Operator. Scotiabank Welcome, everyone, and thank you for participating in Peter Sklar this morning’s call. I’m joined today by our CFO, Gregory BMO Capital Markets Craig.

Irene Nattel Before we dive into the specifics, I will start by saying that RBC Capital Markets I am extremely pleased with our results, which are, by virtually any measure, exceptional. I'm so proud of the Mark Petrie demonstrated resilience of our business, which is truly a CIBC World Markets testament to our associate dealers and our employees. I cannot overstate how much I appreciate and am grateful Vishal Shreedhar for their countless hours of hard work, ongoing flow of National Bank Financial innovative solutions, and unparalleled collaboration across the enterprise. Our teams continue to prove more Brian Morrison agile than ever before, enhancing, expanding our retail TD Securities capabilities, and furthering our positive trajectory.

You've heard me say that throughout the pandemic, our PRESENTATION purpose and north star has been being there for life in . I think it's fair to say that this quarter, we once

again proved that this is not only simply a tagline. It's who Operator we are and what we do. We continue to be there for our customers and our communities when they need us most Good morning. My name is Alana and I will be your as shown by the very busy quarter had by our corporate Conference Operator today. charity, Jumpstart.

At this time, I would like to welcome everyone to the As you may know, in September, Jumpstart launched its Canadian Tire Corporation Limited Q3 2020 Earnings Sport Relief Fund. COVID-19 has forced many Results Conference Call. community organizations to close their doors, and Jumpstart has stepped up to ensure that kids will have All lines have been placed on mute to prevent any programming to return to as it becomes safe to do so. background noise. After the speakers’ remarks, there will They were dispersing $8 million to nearly 700 community be a question-and-answer session. If you would like to sport organizations across Canada, and yet, we know ask a question during that time, simply press star, then that there's still a significant need for support. the number one on your telephone keypad. To withdraw your question, please press the pound key. We ask that In addition to launching the Sport Relief Fund, Jumpstart you limit your time to one question plus a follow-up continued to make impressive progress on its Inclusive question before cycling back into the queue. Play Project. In Q3 alone, Jumpstart opened new inclusive playgrounds in Winkler, Manitoba, , This morning, Canadian Tire Corporation Limited , and (inaudible), , bringing the total to 10 released their financial results for the third quarter of inclusive Jumpstart playgrounds across Canada. These

Page 3 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

types of initiatives aren't easy to pull off at the best of than non-paint customers, they visit the store more times, not to mention during a pandemic, but that just frequently, and with ongoing travel restrictions and limited seems to be our teams’ MO this year; do whatever it entertainment options in Q3, families came to us to takes to make sure Canadians have the support that they enable their creative summer vacation plans such as need, while also doing whatever it takes to ensure backyard (audio interference), camping, and road trips, Canadians can access the essential products and and this drove sales across all the seasonally-relative services to help them navigate COVID-19. categories.

With that, let's dive into the results. The trend of one-stop shopping continued in Q3 where we maintained solid growth in both average basket size Our third quarter was exceptional across a number of key and units per basket. This trend was consistent across all performance indicators. In addition to recording the best regions, with 84 percent of our store network seeing comparable sales growth we've ever reported of 18.9 increased foot traffic, so it should come as no surprise percent excluding petroleum, our e-commerce channel that CTR grew omni share in all five divisions. Living and year-to-date has now surpassed $1 billion in sales, up playing had the strongest performance, both achieving 211 percent from 2019. double-digit, year-over-year market share growth.

Both digitally and in-store, our existing Triangle members In addition to a strong brick-and-mortar performance, were key contributors to increases in store transactions CTR experienced continued growth in our e-commerce and basket size, and the Triangle program acquired channel, up 178 percent in the quarter. E-commerce approximately 400,000 new members in the quarter. penetration is now double where it was a year ago.

We generated strong operational leverage, enabling us to Drilling down in the top online category shows a slightly drop more earnings to the bottom line with a normalized different profile this quarter, including larger bulky items EPS of $4.93, up a remarkable 42.5 percent versus last such as exercise equipment, garage organization, year. I'm pleased with where we stand with our outdoor heating, and both indoor and outdoor furniture. profitability and cash generation, and I'm proud to say We have long said that last mile fulfillment for bulk that earlier this morning, we announced 11 years of assortments is one of our core advantages, and although consecutive annual dividend increases, a key pillar in our e-commerce demand has stabilized somewhat, we capital allocation priorities. anticipate it to rise once again in Q4, and when it does, we'll be prepared to execute and deliver an enhanced Now, I'll move into the results by banner, starting with customer experience to support the digital demand, and CTR. continue to evolve our deliver to home, curbside pickup, and click-and-collect processes, and continue to add Once again, CTR drove our performance in the quarter, more automated pickup lockers across the CTR network. delivering exceptional, comparable sales growth of 25.1 percent. In Q3, more than 90 percent of CTR's 200 Moving on to revenue, as I mentioned on our Q2 call, categories grew. In fact, 80 percent of categories given exceptional consumer demand, it was only a matter achieved double-digit growth. of time before shipments caught up with sales, and in Q3, they did at record levels. Once again, this quarter, and the entire year, for that matter, has proven that home is where the heart is and CTR revenue rose 28 percent, with strong demand where Canadians are choosing to invest. As Canadians across regions in every division. As unprecedented continue to adapt to spending much more time at home, consumer demand continued to put pressure on global the top selling products in Q3 were within our kitchen (inaudible), the teams’ outstanding collaboration with our assortment, supporting the home cook and at-home dealers helped prioritize the shipping and receiving of key dining themes. categories. Our throughput capacity in the quarter was stretched as we processed an all-time record of product The DIY home improvement trend has accelerated through our distribution centres. Achieving these results demand across many home improvement categories was no small feat. Hats off to TJ Flood and his leadership including lawn and garden, tools, paint, and hardware, group for all of their efforts. and this trend provides opportunities to strengthen these new customer relationships. As an example, the average With strong collaboration and expertise in our supply paint customer is much more lucrative than the average chain and merchandising teams, we overcame countless CTR shopper. Not only do they spend three times more challenges in getting product to stores and customers, Page 4 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

and we've increased our distribution capacity by leveraging our existing assets, including the reopening of Mark's delivered a great quarter, with comparable sales our Airport Road DC facility in September, which is now and e-commerce growth of 5.7 percent and 166 percent, operational and shipping an average of 175 trailers per respectively. Mark's remains highly relevant for week. This facility has traditionally been used for overflow Canadians, with industrial as the growth leader in the storage, but we have now enabled it for outbound quarter and work wear proving to be a highly-resilient fulfillment to stores. category. In addition, our Levi's denim program resonated very well with our customers in the quarter, as did our We continue to look for ways to keep up with demand men's and women's casual wear assortments. Similar to and improve our supply chain flexibility. We're actively CTR, sales were driven by both higher traffic and a larger managing product flow more efficiently with direct ship, basket size. balancing our inbound across all regional DCs, as well as the ongoing dynamic prioritization of key categories. Mark's continued to shift to a more digital approach throughout the quarter, including efforts to shift from I'll now move on to Sport Chek's results. traditional print flyers to digital flyers, launching targeted one-on-one offers to the Triangle member base, offering Up against our strongest comparable sales quarter of its first-ever exclusive Triangle member offer on Denver 2019, comparable sales declined 1.4 percent in the Hayes product, and improving the customer experience quarter. Sales momentum in June carried into July with for curbside pickup. In addition, Mark's achieved a new sales up 17 percent versus 2019. However, it tapered off, milestone, with owned email audiences reaching over two with softer demand in back-to-school categories, which million email subscribers, up 20 percent from last year. led to us dialing down our promotional activity to focus on It's quite refreshing to hear PJ Czank talk about full price sell-through which improved our gross margins experimentation efforts designed to create greater and optimized our profitability. This is in contrast to how engagement with Triangle members, and how these we managed the second quarter in which we prioritized digital marketing efforts will drive the business going top-line sales through cash conversion of on-hand forward. inventory. Virtual schooling, the postponement of hockey, and cancellation of many organized sports and activities Moving on to , although external revenue lowered demand for kids' footwear, bags, athletic was down 0.9 percent on a constant-currency basis in the clothing, and hockey equipment. quarter, we are seeing encouraging signs of a rebound in key areas of the business. Helly is managing the e- You may also recall that we transferred our bicycle commerce shift effectively, with the business delivering inventory from Sport Chek to CTR in Q2 which negatively solid results in the direct-to-consumer channel at plus 26 impacted sales in the quarter. Sales were strong in percent. E-commerce mixed within D2C was up 82 categories like hiking and camping, as well as golf and percent in the quarter. Helly Hansen's work wear fitness. It's also important to note that 55 percent of our category, which represents almost a quarter of their Sport Chek stores operate within malls which we all know business, continues to be a resilient and strong continue to be subject to restricted operating hours and performer, and the Helly team continues to focus on the less foot traffic. The headwind is likely to remain. future, recently signing partnership agreements to be the official head to toe apparel partner for all Canadian Ski We accelerated Sport Chek's engagement with the Patrol members, and the official supplier of the Triangle program with over five million customers Norwegian National Alpine Ski Team. These deals are a receiving unique, category-specific offers through the testament to Helly's status as the leading apparel brand deployment of one-on-one bonus offers sent to Triangle to ski professionals, and their dedication to the members. development of high-performance apparel.

Sport Chek e-commerce sales accelerated further, up 90 Before I hand the call over to Gregory for the financial percent in the quarter. Our ending inventory in the remarks, I want to highlight the impressive performance business is materially lower, which sets us up well to be of our owned brands' portfolio. fresh next year, and the teams have ramped up their purchasing efforts for Q4. Steven Brinkley has jumped With $1.3 billion in sales at CTC, owned brands right into the operations of the business, and I'm quite accounted for an incredible 36 percent of our retail sales pleased with Sport Chek's performance in the quarter. in the quarter, delivering impressive 23 percent growth over last year. At CTR, owned brands grew 28 percent Now, moving on to Mark’s. thanks to big names such as , Motomaster, Page 5 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

NOMA, Woods, and CANVAS. We're also very pleased relatively smaller contributions of our higher-margin with strong growth achieved in newer owned brands, automotive business. including Vermont Castings, (inaudible), and Rally. A final dynamic I would want to highlight is related to At Sport Chek, owned Brands' penetration reached 14 foreign exchange. While our currency hedging program percent, up from 10 percent a year ago. Leading owned typically limits our exposure to the spot rate, the recent brands such as Ripzone, Helly Hansen, and Woods significant growth in demand has led us to making more drove those results, which helped sales and led to purchases at the spot rate, resulting in a gross margin meaningful gross margin improvement. headwind.

Our strong performance in the owned brands portfolio will Partially offsetting the margin compression in retail was a position us well going forward as we believe that once rate improvement at Sport Chek attributable to a customers move to trial, that they will be thrilled with our favourable price impact in what has been a less product quality and performance, and hopefully, over promotional environment and a more profitable product time, evolve to coveting and remaining loyal to our owned mix. brands, and with that, I'll pass it over to Gregory. In light of the strong revenue growth, our corporate revenue is—our corporate inventory is sitting $106 million Gregory Craig, Chief Financial Officer lower versus prior year. Strong sell-through at Mark’s and lower purchases at Sport Chek in the first half of the year Thanks, Greg, and good morning, everyone. contributed to the reduction in inventory. Offsetting this are higher CTR inventory levels in anticipation of our As Greg mentioned, we were very pleased with the busiest fourth quarter, and we are in a strong position to results in Q3. We converted our exceptional top-line meet dealer and customer demand. growth into profit, while also generating strong operating leverage. I am pleased with the progress we have made in the quarter generating operating leverage. Our consolidated, On a normalized basis, after adjusting for $8 million of normalized Opex rate, excluding petroleum, improved by operational efficiency charges in the quarter, diluted 264 basis points. Double-digit revenue growth, our earnings per share were $4.93, up 42.5 percent versus ongoing efforts to control discretionary spend, and the prior year. This earnings growth was driven by meaningful progress within our operational efficiency exceptional performance in our retail business, which program resulted in a considerable improvement to our drove approximately three quarters of our IBT in the operational leverage. quarter with positive results across all of our key retail performance metrics. I also want to highlight that, on a year-to-date basis, our normalized ops ratio was 13 basis points better, and First, with respect to our retail top-line, revenue growth, while this figure reflects a more muted revenue growth excluding petroleum, grew 18.6 percent, and this was due to the Q2 store closures, it captures our expense closely aligned to the comparable sales trend in the control efforts and the operational efficiency benefits quarter. This performance was driven by significant we've realized to date. growth in dealer demand at CTR and at Mark's by strong sales, especially in the industrial category. The growth While I'm covering Opex, I have two COVID-related was only partially offset by softer revenue at Chek and expense items I would like to call out. Helly Hansen, which Greg touched on earlier. The retail gross margin rate, excluding petroleum, while down 137 First, we incurred $18 million in costs associated with the basis points in Q3, improved relative to where it stood enhanced safety protocols at the stores and the special last quarter. support program for frontline employees. This is less than we saw in Q2's results, partially due to the fact that the There are several factors impacting margin rate in the support payment came to an end in August, and second, quarter. As a reminder, CTR has the lowest margin rate as was the case in Q2, we saw a benefit in our share- among the retail banners, and similar to Q2, CTR's based compensation expense of approximately $16 significantly higher contributions to revenue weighed million due to the continuing recovery of the share price, down the overall retail margin rate. Additionally, within which, at the end of Q3, had rebounded to its pre- CTR, there was a business mix impact due to the pandemic level. This was reflected in personnel costs. The combined impact of these two offsetting Opex items Page 6 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

netted out to a $2 million increase in expenses and a All in all, in the quarter, the business delivered earnings $0.07 hit to our diluted EPS. before taxes of $91 million, which was $18 million below the prior year, and while there's still significant uncertainty Our balance sheet remains in a healthy position, and we looking ahead, we have reasons for cautious optimism. ended the quarter with over $1.7 billion in cash and marketable securities. In addition to our strong cash flow Despite the continuing headwinds impacting our generation, we continued to take actions to prioritize our receivables, we were encouraged to see credit card liquidity and our financial flexibility. spending trends improve throughout the quarter, and, in fact, in September, credit card sales were essentially flat Within retail, we repaid $250 million owing on our to last year. medium-term notes issued in 2018 in support of the Helly Hansen transaction, and continued our focus on prudent We are also keeping an eye on some favourable management of our operating and capital expenditures. macroeconomic trends related to savings levels, and In Q3, our capital spend of $58 million was essentially cut decreasing levels of debt as a percentage of disposable in half relative to the prior-year levels as we deferred non- income, both of which may be positive signs as we look essential projects, while still prioritizing investments in our forward. store network and our digital platform. Now, I realize this is the time of year we've typically shared our expected Clearly, these are all trends we continue to keep a close range for capital spend and a forward-looking estimate of eye on, but I do want to remind everyone that we believe our tax rate. In light of the ongoing uncertainty related to our payment trends have been helped by government the pandemic, we are not in a position to provide either at subsidy programs and mortgage interest deferral plans this time. offered by the banks.

Also, the pause we took earlier in the year on our share As it relates to liquidity at financial services, we repaid buyback program continues to be in place, and at $700 million on our note purchase facility with present, we do not expect to make any further share Scotiabank, and also repaid $500 million of Glacier term repurchases other than for anti-dilutive purposes, and we notes at maturity. We subsequently issued $480 million of were pleased to announce earlier today a 3.3 increase in Glacier term notes, and were pleased to see investor our annual dividend from $4.55 to $4.70 per share. This demand at the high end of our historical experience represents the 11th consecutive year that we have oversubscribed on both the senior and subordinated increased our dividend, and last but not least, a few notes. Our success with the Glacier deal was a nod to the comments on our financial services business, which strength of the business and a clear signal of investor continues to deliver strong operational metrics in a confidence. challenging environment. Before I hand it back over to Greg, a quick reminder that Consistent with the second quarter and general industry 2020 has 53 weeks, and, as a result, we will have one trends, the ongoing impact of the pandemic has led to additional week in the fourth quarter. Consistent with our lower credit card spending, which has translated into past practices, we will provide you with a comparable receivables being down 7.1 percent in the quarter. As a same-sales metric that is based on a comparable number result of this trend, we collected less interest charges and of weeks in both years, but we will not try to isolate out its interchange fees in the quarter, and our gross margin impact on earnings. dollars declined by $20 million—$21 million versus last year. With that, I'd like to hand the call back over to Greg.

Our credit card portfolio continued to be operationally strong, ending the quarter with a PD2 (phon) plus rate of Greg Hicks, President and Chief Executive Officer 1.91 percent, better by 83 basis points compared to Q3 last year as customer payment trends remained strong. Thanks, Gregory.

If we look at our allowance rate, it was 15.32 percent in Before I close, I'll say we've got good momentum heading the quarter, slightly higher than where it was at Q2 of this into our busiest selling season, and I'd love to say more, year as we continued to see a decline in receivables in but Gregory won't let me, and although we've chosen to Q3 as compared to Q2. take a more cautious approach with our Q4 promotional calendar in order to maintain safe levels of traffic at our

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stores, we feel good about our business as we head into on your telephone keypad. We ask that you limit your Christmas. time to one question plus one follow-up question. We'll pause for just a moment to compile the Q&A roster. Regardless of how COVID-19 progresses, we're confident that Canadians will still find ways to celebrate The first question is from Patricia Baker with Scotiabank. the seasons, and we expect that decorating the house Please go ahead. will be one of our customers' biggest joys this Christmas. Believe it or not, Christmas sales are already quite strong at CTR, and the early snow in the west drove our Patricia Baker, Scotiabank outerwear business at both Mark’s and Sport Chek. Good morning, everyone. I have one question and then a When it comes to digital, we are hardening the CTR site follow-up. to handle what we know will be increased demand during the quarter. We know that having a broader online In the release and in your comments, Greg, and as to you assortment is critical and a significant opportunity for us too, Gregory, you really emphasized the fact that Triangle given heightened demand to our CTR site. We are was a big contributor to your success in Q3, and currently on-boarding new online-only vendors as we look particularly that you saw very strong growth with young to expand our relevance in key categories. New families, which is a target group that you've been talking assortments have already been launched. Baby and about for years that you really wanted to get to with the furniture are now our top two categories in online-only loyalty program, and I guess it could be—to be fair to say sales, and will serve as a template as we work to that—I mean, I think COVID provided you with an accelerate the growth of online-only sales in 2021. opportunity to really show what you can deliver through Triangle with your three banners, but particularly with As I look ahead, I am pleased with the progress we are Canadian Tire. making on our One Digital Platform, and we're on track to roll out in 2021. We're continuing to invest in our store I'm just curious if you can talk a little bit about what network, having opened three new concept stores during specifically in the quarter drove that with respect to your the pandemic. Our new Liberty Village, Niagara Falls, penetration of the young families in Canada. Do you still and Fort St. John's stores provide seamless shopping say that there's further room to go, and is there anything experiences, a focus on a community connection, and specific that you're doing with Triangle for the holiday offered highly-tailored assortments led by data analytics season this year that will differ from what you might have and a focus on bringing owned brands to life in an done last year? In other words, are you leveraging the environment that better enables our customers to shop strength of that business and the data analytics further how they choose. than you might have in the past?

Between the proven strength and relevancy of our brand and current momentum, I feel confident about our future. We know what we need to do. As much as our business Greg Hicks, President and Chief Executive Officer may be complex, our purpose is simple; continue to be there for Canadians. Sure. Thanks, Patricia. I'll try and hit on a few things there. With that, I'll turn it back over to the Operator for questions. I mean, I think, contextually, I would start by just saying I am so encouraged by the metrics that I'm seeing in terms of customer engagement, and I guess just the adoption of

a real understanding of how critical the Triangle program

is in creating a differentiated value throughout the QUESTION AND ANSWER SESSION organization. In my prepared remarks, I talked about digital acquisition in Mark's as an example, and I think Operator one of the most important things from a metric standpoint is how the program is engaging new members. Thank you. I quoted 400,000 new customers, but that's not the whole At this time, I would like to remind everyone in order to story. We had just under 200,000 customers re-engage ask a question, please press star, then the number one with us, meaning they shopped us in the quarter, but

Page 8 CANADIAN TIRE CORPORATION, LTD. Q3 2020 EARNINGS CONFERENCE CALL Thursday, November 5, 2020 – 8:00 A.M. ET

have not shopped with us in the last 12 months, so it's 600,000 customers that we now have the chance to build a relationship with going forward. If you just look at how Greg Hicks, President and Chief Executive Officer they spent this quarter, they spent over $125 million with us across the portfolio, which, on an isolated basis, is Absolutely. We've engaged externally from our official three points a comp when you compare it to last year, so intelligence standpoint with some real expertise to it's an extremely meaningful opportunity for us. completely turn our business processes for planogramming (phon) stores upside down to have it very If we look at the number inclusive of Q2 and Q3, it's over store-specific, to utilize big data, to really cater and carry a million new and re-engaged customers, and, as you assortments at an individual level, so the intent and the— point out, it's now up to us to try and build a continued or kind of the north star of the work effort is for us to be sticky relationship with them and engage them in our able to sit down, or for the dealer to be able to self-serve program post-COVID, so yes, we believe—to answer a it on their own and really optimize assortment in an aisle couple of things in your question, we really believe that by a business, by a division, the overall store, etc., and we have room to go. I mean, we just have unbelievable quite frankly, if we get the capability to where we would opportunity with these new customers. They are over- like, we think there's lots of applicability in the rest of the indexing to young adults and active families, which is retail portfolio as well, so lots of great analytical work right in our sweet spot for CTR and for lifetime value going on in our network performance division, and the across the portfolio, and in terms of what's different as we great news is the dealers are just eating it up. We can't head into Q4, I would say the biggest point of difference go fast enough, so we think it's a tremendous opportunity is our ability to engage Triangle members for Sport Chek going out to the entire network, Patricia. and Mark’s.

We talked to you a little bit about the traction that we made and changes we made and—with the signing up a Patricia Baker, Scotiabank new dealer contract, which gives us a little bit more access to the utilization of that customer data for Okay. Thank you so much. I'll get back in the queue. engaging customers, and my prepared remarks would have suggested that we were often running on that in Q3, so you can expect that to be very different on a year- Operator over-year basis in Q4. Our analytics just in terms of recommended offers, next best offer, engines, etc. at a Thank you. The next question is from Peter Sklar with personalized basis are just getting stronger; more work to BMO Capital Markets. Please go ahead. do to really kind of hone in and make it as efficient as possible, but our return on ad spend in a lot of the metrics Mr. Sklar, your line is now open. Please proceed. that we look at from an efficiency standpoint for our one- on-one offers are all going in the right direction. Peter Sklar, BMO Capital Markets

Patricia Baker, Scotiabank Thanks.

Okay. Thank you so much for that. I'm just wondering if you could give some flavour on how things were looking at the end of the quarter and as you Now, in your—this is a related follow-up, but in your—in exit the quarter in terms of the core Canadian Tire banner closing remarks, you talked about your investment in the and the comp. You indicated that—there was some store network, and I was intrigued to hear your talk about commentary that you're going to be less promotional in that these stores have highly-tailored assortments. Now, the fourth quarter, but you are seeing—but you have said presumably, the ability to—I could be wrong, but the you're seeing strength pretty well across all categories. ability to have the highly-tailored assortments relies on, I It's just not the obvious summer seasonal categories, so guess, the data that you have from customers, and goes a bit of a mixed message there. I'm just wondering if you back to Triangle and another use of it. I'm just curious, do could talk a little bit about what you're seeing as you exit you think there's an opportunity to further tailor the quarter and as you get into the fourth quarter, and assortments in your—bring that notion back into your obviously, there were some weather effects, as well, you existing, not new, store base over time? talked about; the weather you've seen out West. We're

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getting some warm weather in now. There's a lot they can, as are our dealers, and we're certainly better of moving parts here. Greg, is there anything you can prepared than we were early in the crisis, that's for sure. kind of fill us in on?

Peter Sklar, BMO Capital Markets Greg Hicks, President and Chief Executive Officer Why did you make the commentary then that you're Sure. I'll start. Gregory may keep me honest here. scaling back on your promotional intensity for Q4? Is it just because the sales are there or you don't have the Yes, as I mentioned, over 90 percent of CTR's categories inventory? What's your strategy there? grew in Q3, which just, I think, continues to speak to the relevance of this multi-category assortment. We believe that the macro trend with respect to one-stop shop is Greg Hicks, President and Chief Executive Officer here to stay at least over the winter and while the pandemic is ongoing, and this certainly is a big tailwind It's completely from a consumer safety standpoint, and I for CTR, so you can expect that to continue right into Q4. don't expect you're going to see anything different from our competition. I mean, when we've heard us talk about In terms of what will be different in Q4, we do think that just how much of the business in Q4 travels through the our Christmas categories will be top-of-mind for last five weeks of the year, and specifically, those four or customers. We already saw a similar trend play out with five days at the end of November, Red Thursday through our Halloween decor categories in late October. to Cyber Monday, we can't handle the traffic patterns into Additionally, we have tremendous ongoing strength in the store effectively and safely even at kind of last year's core, very large, non-seasonal businesses. The kitchen numbers without contemplating any growth that will layer business, the tools business, the cleaning business are on that. all performing exceptionally well and are top drivers of the overall portfolio, so we don't expect any changes The lineups would be completely out the door. I think you associated with that as the weather turns here. can expect us to be highly competitive and very focused on sharpening our pencil, creating value extremely As the cold weather arrives, customers are certainly relevant for gift-giving, and all those things that are shifting to restoring the comfort of their home and well- important in the last six weeks of the year, but I think being, so we're seeing fixing projects continue to be you'll see our big demand events just stretched out over critical, and maybe even dial up a little bit in businesses longer periods of time. like painting, setting up workspaces for a number of family members, and then wellness is just so top-of-mind across CTR and Sport Chek, so we're seeing continued demand for exercise equipment, and then wellness of the Peter Sklar, BMO Capital Markets mind, I guess, with indoor games. Okay, and then just lastly, on the financial services I mean, the search result differences on a year-over-year business, do you have any thinking on when consumers basis for searches like games rooms, ping pong tables, are going to start—when your—your MasterCard pool tables, etc., winter cycling for indoors and outdoors, consumers are going to start borrowing again on the so it is—it's really amazing when you think about the credit card and when you hope to see growth in breadth of the categories that we offer. Just different (inaudible)? Do you have any feeling about that, because categories end up being in the mindsets of Canadians at as you point out, consumers have been busy paying different times, and we've got solutions, and I think you down their balances through COVID? heard us talk about the demand for outerwear in other banners as people do get ready for the cold weather, but I also believe that’s a nice tailwind just in terms of people Gregory Craig, Chief Financial Officer wanting to continue to get out of their house; people in walking routines, etc. You've got to put different gear on Yes, Peter, it's Gregory here. Thanks for the question. as we move to a different season. October was strong, We tried to highlight some of the comments in my but, as you know, November and December are huge commentary, but I'll elaborate a little more. In the month months, but we feel like the teams are doing everything of September where we saw credit card sales essentially be flat to where it was a year ago, we hadn't seen that

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since March, so it's the first month out of the last six or so getting asked a lot is how much of that might be pulled where we actually saw sales trends kind of get us back to forward versus incremental demand, and I know that may where they would have been a year ago. be hard to tease through, but kind of wondering what your data is showing you and your relative share of I will say the team in—over the last six months have consumer wallet and that kind of thing. really been focused on building out kind of digital acquisitions, tools and methodologies, and just building that strength, because as you can imagine, when stores Greg Hicks, President and Chief Executive Officer are shut, I mean you're not acquiring card members in stores, so I think the team’s done a really good job kind of Yes, Irene, it's Greg. really reshaping and rethinking that digital experience, and more recently I know they've been back in the stores It is very difficult to ascertain. I mean, we—in our testing acquisition in store that is safe for both the spring/summer businesses, when you think about employees, and obviously, safe for the customers, and I businesses like outdoor furniture, outdoor grilling, think they've found a methodology and an approach that bicycles, etc., I mean it's extremely difficult to find any they think is now scalable, but I mean it's just going to inventory across the land. We will certainly need to take a little bit of time. You can't turn that—it's not like a replenish store inventory, and that's the big question for light switch where you can turn it kind of on and off that the teams is how we forecast consumer demand heading quickly, so it's going to take a little bit more time to go into last year. back into the stores. We certainly believe, through our analytics, that we left a Again, Greg talked about safety. It's just top of our mind, lot of business on the table. As happy as we are with the right, and so I think that's what we'll just keep an eye on tremendous performance, we could have sold a lot more is kind of the sales trends, and I mentioned about those if we had inventory, and it was not a Canadian Tire macroeconomic trends as well, that those are making us unique situation for some of the categories that I just feel a little bit better than certainly we would have been talked about, but the strength is—as I indicated, is not three or four months ago, so I think we feel very good just seasonal. It's non-seasonal as well, and so we know, about financial services. I still think there's a great through the research that we conduct externally, that we opportunity to improve integration within retail to add kind are taking share significantly, both bricks-and-mortar and of longer-term value as well, but I just think we want to be e-comm. I think I stated that with all of the divisions in careful over these next little while to just not—similar to which we compete, and it's really crystal ball time in Greg's point, don't want to drive kind of promotional terms of how we think through what was pull forward activity and want to keep everybody safe would be how I versus not. I wish I had a better kind of fact-based would answer. answer for you, but it's really difficult to figure out what was—what's pulled forward.

Peter Sklar, BMO Capital Markets Irene Nattel, RBC Capital Markets Okay. Thank you. Yes, understood. Thank you.

Operator Just I wanted to ask a follow—I have one other question—two other questions—or one and a follow-up, Thank you. The next question is from Irene Nattel with so the other question is, thinking about automotive in Q4 RBC Capital Markets. Please go ahead. and Q1, with travel being sharply reduced, there's probably the snow—a lot of snow birds who normally would be (inaudible) to warmer climes are now, at least Irene Nattel, RBC Capital Markets for the time being, effectively stuck here and likely to be for a little while, so how are you thinking about that for Thanks, and good morning, everyone. Just a couple of automotive in addition to seasonal? questions, if I might. You did a great job of talking about the performance of the seasonal and the core categories during Q through—Q3, rather. One of the questions I'm Greg Hicks, President and Chief Executive Officer

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data and analytics role with the store of pre and post Yes. I mean we called out automotive impacting our benefit relative to a control set, so that testing capability overall gross margins because it's not growing at the that we have in the organization that we've talked about same rate as the rest of the portfolio, but it's still growing before is alive and well, and—in this area, and we—it's extremely healthy. I think the number was 16 percent in one of our most important priorities going forward, and the quarter, so much higher clip than we have been like I said, it's nice when our priorities are 100 percent accustomed to over the years. You have to keep in mind, and completely aligned with the dealers, which this one from a travel standpoint, I go—tires drive so much of the is. overall automotive service and core kind of front end suspension, etc. businesses, and we only have a 15 percent market share in tires, so 85 percent of Canadians Irene Nattel, RBC Capital Markets buy their tires somewhere else, so when we think about a million new Canadians engaging with the program, when That's really helpful. Thank you. you think about the existing loyalty base, and now our ability to engage with them with offers, I think about tires, and early season here, our tire business is extremely strong, so some of this—some of the actual facts defy the Operator subjective odds or logic, but we're feeling very good about our automotive business. It's just not keeping pace Thank you. with how great the business is in categories like living and playing, but again, our core businesses in automotive The next question is from Mark Petrie with CIBC. Please are showing up the way we want them to. go ahead.

Irene Nattel, RBC Capital Markets Mark Petrie, CIBC World Markets

That's great, and then just the follow-up question that I Yes. Good morning. had, and it's a follow-up to the conversation you were having with Patricia, how long do you think it will take to I also wanted to ask about assortment, but maybe a little kind of tailor the assortments on a store by store basis, bit different kind of angle, and I guess focusing on CTR, which could drive some interesting upside to sales? but also curious about any comments with regard to the other banners as well, but just sort of going through the pandemic and seeing how consumers are shopping your banners, how does that affect how you think about your Greg Hicks, President and Chief Executive Officer assortment categories that you offer, but also depth and breadth of the assortment, and I guess, obviously, owned I mean, we—every store we open, we get some brands is a key part of this. You noted the strength that incremental benefit, and—but data and the capability just you're seeing there, and I know it's been a long-term gets stronger and stronger, especially as we're starting to focus, but just also interested specifically how all of this engage with much more sophistication from an AI fits in with your owned brand strategy. standpoint, so it'll never be a light switch. I don't think you'll ever kind of wake up one day and have the most sophisticated modeling tools and be able overnight to deploy it to 500 stores unilaterally because you’ve got to Greg Hicks, President and Chief Executive Officer get the—there's a whole kind of back office that needs the support, the delivery of that in front of the customer in Just trying to think about how to answer that, Mark. As terms of the supply chain and stocking levels and you know, it's almost 200 categories under the roof of changing ordering algorithms, both on our end and Canadian Tire already, so it's one of the reasons that I working with our vendor forecasts and store forecasts, felt the need to just call out in prepared remarks this etc., but we're getting benefit now, Irene. notion of how we extend the relevance of our assortments with online-only. We've seen how Canadians I mean, we may just not have been talking about it much, have come to, I guess, the front door of all of our stores, but our network performance could show you every which is the website, and our traffic is up exponentially; I intervention—our Network Performance Team, sorry, mean tens and tens of millions of incremental visits every could show you every intervention where they've played a quarter, and so how do we capitalize on that knowing that

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we have a kind of fixed space, etc., inside the stores, and so it's multi-year platforming capability that the teams so when you think about a business like baby and a have been building. business like furniture, (inaudible) require a lot of space to show physically. Even smaller brand investments like our acquisition of Muskall (phon) where this year we grew the brand by 250 We're doing our best to deliver an experience online, and percent, and just the incremental margin on those sales it seems to be working. The take-up rate and sales on have paid for over 50 percent of the acquisition in less those new programs are fantastic, so I think that's one than a year, so no fly zone in Mark’s, just lots of stuff way, Mark, is we're really thinking about an online-only going on, so that, obviously, is a capability we've been assortment. I think we'd like to think about it right now as building over the last two or three years, and is a very an extension to the categories in which we compete important part of how we view breadth, depth, today as opposed to net new categories, but that architecture, price laddering, all that good stuff of certainly would be an option for us as well. assortment planning.

I think the teams are really focused on—gets back to an earlier question—they're really focused on trying to Mark Petrie, CIBC World Markets forecast consumer demand for 2021 as opposed to thinking through—that's keeping them pretty busy—as Okay. Thanks. opposed to thinking through net new assortments, so it is that depth. We're still finding a way, even through work Then just quick in terms of a follow-up, you touched on from home, to do as many line reviews and what have online-only. Obviously, that is going to play an increasing you, so we always do breadth and depth reviews as part role. I'm just curious how material that is today and how of that kind of normal process, but I think it's just focus on does the financial model work for that business? Thanks making sure the businesses that we're in that we're ready a lot. for the demand next year, sprinkling in the online-only, and Party City is a whole new category that the team has been quite focused on in the party assortment, and we've done a lot of work in Q3 that will manifest in late Q1 and Greg Hicks, President and Chief Executive Officer early Q2 next year, which has us rejigging some of the retail floor and the categories, etc., and had us on- Yes. It's small today. Like I say, it's just—it’s a few boarding about 50,000 SKUs to our assortment, so it's categories here or there, but we think a nice complement, really about focus, I think, Mark, across the portfolio, and and the model works exactly the way the model works keeping the teams focused on executing on that Party with the rest of the business. There's no differences there City extension to the core assortment across the network. whatsoever.

I'd love to touch on owned brands, Mark. I mean, we— we're just so pleased with what's going on from an owned Mark Petrie, CIBC World Markets brand standpoint, not only in Canadian Tire, but in Sport Chek. I think that's a meaningful penetration increase that Okay. Thanks a lot. All the best. I alluded to in Sport Chek, so you've heard us talk about our targets for owned brand penetration, and across— everywhere across the portfolio, I've just continued—I Operator continue to be amazed at how the teams are thinking about driving relevance in those brands. Thank you.

I'll hit a couple of highlights. The Rally brand in the bike The next question is from Vishal Shreedhar with National category in CTR, we had a soft launch this year where Bank Financial. Please go ahead. we shipped out about 5,000 units, and we had a 95 percent sell-through. These bikes are higher price point. If you look on the website, you'll see the—littered with 5- star reviews, so teams have been working really hard. In Vishal Shreedhar, National Bank Financial the spring, you're going to see a more fulsome assortment of bikes and bike accessories, and then Hi. Thanks for taking my questions. Just on Triangle, they've got a '22—a 2022 platform and a 2023 platform, obviously seeming like that Triangle's gaining momentum quarter-by-quarter, and you've gotten a lot of success

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with that program. Wondering where Canadian Tire is you're able to keep into the system, and what initiatives with Triangle with respect to what it envisioned the that Tire has ongoing to identify those customers and program could be when it's—when it launched about—for keep them in the system, particularly those outside of example, are you squeezing—is it early days for this Triangle. Thanks. program? Are there opportunities to maybe sell data to your vendors? Is there opportunity to get more retailers on board with that? Maybe some thoughts on that. Gregory Craig, Chief Financial Officer Thanks. Yes, maybe Vishal, Gregory here. I'll start off, and I'm sure Greg will have a few comments as well. Greg Hicks, President and Chief Executive Officer I would give an example of kind of a new credit card Yes, so I'll take that. Gregory may want to pile on. customer and the programs that the teams have developed as in terms of there's customer acquisition, Vishal, I think we're still early days. I mean, if you think there's customer engagement, there's customer about it in terms of it’s focused just kind of building out of retention, all of which are strengths I think that we're the business that we have today and the engagement building across the organization, or as Greg said, that we have with customers, we're—we feel like we're capabilities, so I mean, the good news, frankly, is the just getting started in Mark's and Sport Chek. We're 400,000 number I think it's a great start around attraction, building capabilities to be able to really use data and but to your point and to Greg's point, we want to get analytics to determine what the next best offer for Vishal those loyal Canadian Tire customers, so Susan O'Brien might be. That could be anything from a product in Sport and the team are very much engaged at kind of using all Chek to a division you may not have shopped in the information we have to understand more about Vishal Canadian Tire, like my tires example, or it could be giving as a customer and what he may value, so I go back to you a credit limit increase in the bank, so all of those kind Greg's last comment. I think we're in the early innings of of capabilities with respect to next best offer, we're just the game on this still. I think we've got a great asset to getting started. build from.

You talk to monetization opportunities. Sure. I mean, lots We’ve built a bunch of capabilities in my mind, and now I of retailers are doing that. You've heard me talk about our think it's time to really start to talk more and to take belief that we have very rich digital customer platforms, advantage of this, so I really think you're going to see and so I certainly wouldn't be surprised if that's part of our more, so the specifics around those customers you've strategy going forward, and then the last piece is you've identified, I think the question to me will be where are we seen us, through the bank with the value proposition on with them in a year from now, so how many of them were the credit card, engage with partners to kind of increase one and done and how do we re-engage them, so I our value proposition, stickier relationships. You've seen think—and that's kind of top-of-mind I think for all of us us extend that into a relationship with Budget Car Rental here on the Management Team is how do we continue to and Husky Gas, etc., so partnerships in the loyalty maintain a relationship with these customers over time, ecosystem we believe is a big opportunity for us, and so I think it's a great question, and I think we've got a lot we're just getting started, so that's a quick summary of of strengths that we can start to leverage and use now to where we think we are. kind of really build that out even more.

Vishal Shreedhar, National Bank Financial Vishal Shreedhar, National Bank Financial

Okay. Thanks for that. Thanks, guys. Congrats.

Just changing topics, another quick one here. Obviously, very strong same-store sales growth across retail, and Operator presumably—and you've already indicated that you're getting new customers coming in, walking into the store, Thank you. and also via Triangle. Wondering to what extent these new customers in trial, if you have any ability to know what percent of these new customers are sticky and

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The last question will be from Brian Morrison with TD mind than just the fact that it's one-stop shop. I think it's Securities. Please go ahead. all the things we've been working on. It's the owned brand strategies. All these things to me that we've been working on over the past years are putting them all Brian Morrison, TD Securities together, to be honest with you.

Hey. Good morning. Just a couple of follow-up questions. Greg Hicks, President and Chief Executive Officer Greg, first one on loyalty. The 400,000 new members, what’s the total members now? Can you just clarify, Yes, I would agree. I think the—it may start with the one- really, what drove that increase? Is it your portfolio of a stop shop given the vastness of the portfolio, but if you one-stop shop, and then what's the average spend of a take the 400,000 new members as an example, a large loyalty member versus a non-loyalty member per percentage of them engage with us online, and so what's purchase? great about that is in order to engage with us online, you authenticate almost immediately from an email, contactable standpoint, information, etc., and now we can Greg Hicks, President and Chief Executive Officer segment them, and so we think our online capabilities, as well, are a big driver of this, and to the degree that we get We may have to get back to you on those stats, Brian. to know these customers, it just sharpens our ability to be The actual total—we call them active members—we've able to engage with them and keep them around, so I'd got—we've sort of—we've quoted 10 million total agree with Greg. It's more than one-stop shop, but I think members before, nine million active members. If that was the premise of your question, I think there's a lot there the cut-off line prior to Q3, we would have probably 9.6 given just how many categories we participate and how million active members with the 600,000 I talked about. many jobs and joys we cover off for life in Canada. There could have been some churn in the nine million, but yes, I don't have it off the top of my head, and in general, it really depends on the segment in terms of Brian Morrison, TD Securities spend, but it's roughly double the spend of a non-loyalty member on average, and certain segments like active Okay, and then follow-up for Greg very quickly, just families, which is why we're so attracted to them, would confirm it sounds like your outlook on the card portfolio index much more from a spend standpoint. for Q4 in 2021, it sounds like a focus on aging with some measured growth. You took a pretty prudent provision in Q2, and I'm wondering—there's some uncertainty in the Brian Morrison, TD Securities market with COVID right now, but what would be a key indicator we should be looking for a potential release of Okay, and the increase, is that really just your one-stop that provision? shop across-the-board?

Gregory Craig, Chief Financial Officer Gregory Craig, Chief Financial Officer Yes. I think you've maybe jumped to an answer versus a I'll start, because I've got—it's Gregory here. question, Brian. To me, I think we—there's a number of metrics we look at. I think the one that is publicly shared I think that's a piece of it, but Brian, I think it's broader the most is the aging of the portfolio. As I mentioned, I than just the fact of one-stop shop. I really think it's the think there's some macroeconomic trends that we keep value prop that Greg mentioned around customers an eye on, but I think once some of these mortgage getting in (inaudible). I think it's product assortment. As deferral programs and the CERB (phon) transitions to the you bring customers back to the store and realize it's new government (inaudible), I think we'll have a clear maybe a bit of a different Canadian Tire than they kind of line of sight as to where things are, but I will tell remembered, or kind of the other banners to Chek and you we feel pretty strongly that our payment behaviour to Mark's as well, so I think that's a big piece of it is the one- date has been helped by some of these programs, and I stop shop, but I wouldn't discount the other pieces of that just think it's prudent to kind of watch these programs roll is all I'm suggesting. There's more to that puzzle in my off or transfer into whatever they're going to transfer into

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before we kind of jump ahead, so the way I think of it is we're comfortable with the provision on the balance sheet as of this date.

If you look on a historical basis, we roughly have roughly about two and a half years worth of write-offs in the current allowance, and as you know, the (inaudible) rules, we'll look at that every quarter and take into consideration the trends we see, and that'll help shape what we think we need to book in the next quarter, so I just want to be careful we don't get—we're really excited about the trends around aging and all the operational metrics, but I still think there's some more data we need to see before we start thinking about releasing at this stage, would be my thoughts.

Brian Morrison, TD Securities

All right. That's helpful. Thank you both.

Gregory Craig, Chief Financial Officer

Thank you.

Operator

Thank you.

This will conclude today's call.

A webcast of the conference call will be archived on Canadian Tire Corporation Limited Investor Relations website for 12 months. Please contact Investor Relations if there are any follow-up questions regarding today's call or the materials provided. You may now disconnect.

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