Canadian Tire second quarter net earnings rise 18.4% to $122.3 million; Adjusted net earnings up 9.1%



    
                                     ----------------------------------------
                                                                   Year-over-
    Consolidated                          2007            2006         year
    Highlights(1):                     2nd Quarter     2nd Quarter    change
    -------------------------------------------------------------------------

    Retail sales                      $2.84 billion   $2.70 billion     5.1%
    Gross operating revenue           $2.32 billion   $2.25 billion     3.1%
    Earnings before income taxes
     and minority interest           $188.2 million  $161.5 million    16.5%
    Net earnings                     $122.3 million  $103.3 million    18.4%
    Net earnings excluding non-
     operating gains and losses(2)   $109.6 million  $100.6 million     9.1%
    Basic earnings per share          $1.50           $1.27            18.5%
    Adjusted basic earnings per share
     excluding non-operating gains
     and losses(2)                    $1.35           $1.23             9.2%

    (1) All dollar figures in this table are rounded.
    (2) Non-GAAP measure. Please refer to section 12.0 in Management's
        Discussion and Analysis in our 2006 Financial Report.
    

    TORONTO, Aug. 9 /CNW/ - Canadian Tire Corporation, Limited (CTC.a, CTC)
today reported second quarter net earnings of $122.3 million, an increase of
18.4 percent compared to $103.3 million in the second quarter of 2006.
Excluding non-operating gains and losses, net earnings were $109.6 million, an
increase of 9.1 percent compared to $100.6 million last year.
    Basic earnings per share were $1.50, an increase of 18.5 percent compared
to $1.27 for the previous year. Excluding non-operating gains and losses,
adjusted basic earnings per share increased 9.2 percent to $1.35 compared to
$1.23 the previous year.
    "All of our businesses contributed to our sales growth during the
quarter. Canadian Tire Retail's sales, while impacted by unseasonable weather
in the month of April, strengthened significantly in May and June," said Tom
Gauld, president and CEO. "Our earnings this quarter reflect our continued
focus on productivity and expense control, and we remain confident in the
execution of our strategic growth initiatives."

    
    Business Overview

    CANADIAN TIRE RETAIL (CTR)

    ($ in millions)    Q2 2007   Q2 2006  Change  YTD 2007  YTD 2006  Change
    -------------------------------------------------------------------------

    Retail sales(1)   $2,141.9  $2,064.4    3.8%  $3,384.4  $3,269.5    3.5%
    Same store
     sales(2)
     (year-over-year
     % change)            1.7%      3.3%              1.5%      3.2%
    Gross operating
     revenue          $1,517.5  $1,518.8  (0.1)%  $2,592.2  $2,488.0    4.2%
    Net shipments
     (year-over-year
     % change)          (0.5)%     10.0%              3.9%      5.9%
    Earnings before
     income taxes and
     minority interest   $88.7     $97.9  (9.4)%    $128.7    $136.4  (5.7)%
    -------------------------------------------------------------------------
    Less adjustment for:
      Gain on disposals
       of property and
       equipment(3)        3.7       1.3               3.7       4.7
      Former CEO
       retirement
       obligations        (6.7)        -              (6.7)        -
    -------------------------------------------------------------------------
    Adjusted earnings
     before income
     taxes and
     minority
     interest(4)         $91.7     $96.6  (5.1)%    $131.7    $131.7    0.0%
    -------------------------------------------------------------------------

    (1) Includes sales from Canadian Tire stores, PartSource stores, sales
        from CTR's online web store and the labour portion of CTR's auto
        service sales.
    (2) Same store sales include sales from stores that have been open for
        more than 53 weeks.
    (3) Includes fair market value adjustments and impairments on property
        and equipment.
    (4) Non-GAAP measure. Please refer to section 12.0 in Management's
        Discussion and Analysis in our 2006 Financial Report.
    

    CTR's second quarter retail sales grew to $2.14 billion from
$2.06 billion, an increase of 3.8 percent. Overall same store sales increased
1.7 percent over the prior year, reflecting the impact of soft sales due to
unseasonable weather in April followed by stronger retail sales in May and
June. During the construction and remerchandising of stores undergoing
conversion to the Concept 20/20 format, sales are negatively impacted.
Excluding the impact of 53 stores undergoing conversion, same store sales were
up 2.4 percent in the second quarter. Same store sales at the Concept 20/20
stores increased 4.4 percent. Overall retail sales benefited from an extra
selling day in the quarter in comparison with the same period last year.
    CTR's second quarter earnings before taxes of $88.7 million were
$9.2 million or 9.4 percent below the second quarter of 2006. Three key issues
contributed to the earnings decline:

    
    -   net product shipments to Associate Dealers declined 0.5 percent as
        Dealers adjusted store inventories following an 11.1 percent increase
        in purchases during the first quarter of the year (shipments for the
        first half of the year are in line with retail sales);
    -   total long-term incentive plan costs during the quarter were
        $9.0 million compared to $2.5 million in 2006. Of this amount,
        $6.1 million was related to the expensing of stock options,
        consistent with changes made to the program in the fourth quarter of
        2006. This compares to $0.2 million in 2006. Expenses were also
        higher due to the Company's strong stock price performance; and,
    -   on June 30, 2007, the former CEO, who has been vice-chariman since
        stepping down as CEO in 2006, retired from the Company. The Company
        recorded a pre-tax charge of $6.7 million in the second quarter to
        reflect the cost of amounts he was entitled to under the Company's
        incentive programs and his employment agreement.
    

    Overall, product margins during the quarter were slightly better than
last quarter. Excluding the two expense items noted above, normal operating
expenses were well managed reflecting increased focus on productivity
improvements.
    CTR opened 33 Concept 20/20 stores, including three new or replacement
stores and 31 expansions and retrofits. Two traditional stores and one new-
format store were closed during the quarter.
    PartSource recorded strong double-digit sales growth in the second
quarter, driven by continued expansion of the corporate store network and
growth in the commercial customer segment. PartSource also achieved high
single-digit comparable store sales growth. Three new stores were opened
during the quarter bringing the total network to 67 locations.

    
    CANADIAN TIRE PETROLEUM (Petroleum)

    ($ in millions)    Q2 2007   Q2 2006  Change  YTD 2007  YTD 2006  Change
    -------------------------------------------------------------------------
    Sales volume
     (millions of
     litres)             437.4     418.0    4.6%     852.7     802.8    6.2%
    Retail sales        $471.9    $430.3    9.7%    $857.3    $784.3    9.3%
    Gross operating
     revenue            $445.6    $408.1    9.2%    $808.4    $743.2    8.8%
    Earnings (loss)
     before income taxes  $6.4     $(1.2) 611.9%      $8.9      $0.5 1787.4%
    -------------------------------------------------------------------------
    Less adjustment for:
      Loss on disposals
       of property and
       equipment(1)       (1.0)     (0.2)             (1.3)     (0.3)
    -------------------------------------------------------------------------
    Adjusted earnings
     (loss) before
     income taxes(2)      $7.4     $(1.0) 818.6%     $10.2      $0.8 1233.2%
    -------------------------------------------------------------------------
    (1) Includes fair market value adjustments and impairments on property
        and equipment.
    (2) Non-GAAP measure. Please refer to section 12.0 in Management's
        Discussion and Analysis in our 2006 Financial Report.
    

    Petroleum's gasoline sales volume increased 4.6 percent during the second
quarter to 437.4 million litres from 418.0 million litres a year ago. The
increase was due to the strong performance of the Gas Advantage MasterCard and
the cumulative effect of new site openings. Convenience store sales increased
18.0 percent over the comparable 2006 period, while car wash sales increased
20.8 percent.
    Petroleum recorded earnings before taxes of $6.4 million compared to a
loss of $1.2 million during the second quarter of 2006. Adjusted pre-tax
earnings increased to $7.4 million from a loss of $1.0 million one year ago.
Improved gasoline margins, plus effective expense controls, were the key
contributors to the strong earnings performance.
    During the quarter, Petroleum opened one new gas bar and one new
convenience store. Six traditional sites were modernized in order to enhance
the overall customer experience.

    
    MARK'S WORK WEARHOUSE (Mark's)

    ($ in millions)    Q2 2007   Q2 2006  Change  YTD 2007  YTD 2006  Change
    -------------------------------------------------------------------------
    Total retail sales  $221.3    $201.9    9.7%    $399.7    $353.6   13.0%
    Same store sales(1)
     (% increase over
     prior year)          6.9%     15.2%             10.6%     13.0%
    Gross operating
     revenue(2)         $187.2    $170.1   10.1%    $339.3    $298.8   13.6%
    -------------------------------------------------------------------------
    Earnings before
     income taxes        $24.5     $20.3   20.7%     $35.8     $28.7   24.7%
    -------------------------------------------------------------------------
    Less adjustment for:
      Loss on disposal
       of property and
       equipment(3)       (0.4)        -              (0.6)     (0.1)
    -------------------------------------------------------------------------
    Adjusted earnings
     before income
     taxes(4)            $24.9     $20.3   22.2%     $36.4     $28.8   26.1%
    -------------------------------------------------------------------------
    (1) Mark's same store sales exclude new stores, stores not open for the
        full period in each year and store closures.
    (2) Gross operating revenue includes retail sales at corporate stores
        only.
    (3) Gains and losses on disposal of property and equipment were not
        previously disclosed in our Q2 2006 financial report.
    (4) Non-GAAP measure. Please refer to section 12.0 in Management's
        Discussion and Analysis in our 2006 Financial Report.
    

    Mark's second quarter total retail sales grew to $221.3 million, an
increase of 9.7 percent from the $201.9 million recorded in the comparable
2006 period. The growth was fueled by strong corporate store sales in women's
wear, up 13.1 percent, and industrial wear, up 10.7 percent. Same store sales
rose 6.9 percent during the quarter, with double-digit growth experienced in
Quebec and British Columbia.
    Mark's second quarter earnings before taxes were $24.5 million, a
20.7 percent increase over the $20.3 million recorded a year ago. Adjusted
pre-tax earnings increased 22.2 percent to $24.9 million compared to $20.3
million in the same 2006 period. The growth in earnings was a result of higher
sales and favourable margins.
    During the quarter, Mark's opened two new stores, expanded one store and
relocated four stores.

    
    CANADIAN TIRE FINANCIAL SERVICES (Financial Services)

    ($ in millions)    Q2 2007   Q2 2006  Change  YTD 2007  YTD 2006  Change
    -------------------------------------------------------------------------
    Total managed
     portfolio end
     of period                                    $3,704.3  $3,429.3    8.0%
    Gross operating
     revenue            $197.5    $179.6    9.9%    $379.8    $341.3   11.3%
    Earnings before
     income taxes        $68.6     $44.5   54.2%    $114.0     $73.9   54.3%
    -------------------------------------------------------------------------
    Less adjustment for:
      Gain on disposal
       /redemption
      of shares           18.4       6.9              18.4       6.9
      Gain (loss) on
       sales of loans
       receivable          5.5      (3.4)              2.5     (16.1)
      Loss on disposals
       of property and
       equipment          (0.1)     (0.2)             (0.2)     (0.3)
    -------------------------------------------------------------------------
    Adjusted earnings
     before income
     taxes(1)            $44.8     $41.2    8.6%     $93.3     $83.4   11.9%
    -------------------------------------------------------------------------
    (1) Non-GAAP measure. Please refer to section 12.0 in Management's
        Discussion and Analysis in our 2006 Financial Report.
    

    Financial Services' total managed portfolio of loans receivable was
$3.7 billion at the end of the second quarter, an 8.0 percent increase over
the $3.4 billion at the end of the comparable 2006 period. Personal loan
receivables represent approximately 5 percent of the total portfolio. Ending
credit card loans receivable grew 11.0 percent to $3.5 billion. The increase
was primarily a result of a 9.0 percent increase in the average balance. The
Gas Advantage MasterCard continued to perform well, with a new test market
opened in the province of Quebec in 2007.
    The net write-off rate for the total managed portfolio on a rolling 12-
month basis was 5.89 percent, an improvement from 5.95 percent in the
comparable 2006 period, reflecting the benefits of a number of initiatives to
enhance the overall quality of the portfolio. The net write-off rate for the
credit card portfolio improved during the quarter to 5.62 percent from
5.99 percent in the comparable 2006 period.
    Financial Services' second quarter earnings before taxes of $68.6 million
increased 54.2 percent over the same period last year. Adjusted pre-tax
earnings, which exclude the impact of a $5.5 million securitization gain and
an $18.4 million gain from the sale of shares in MasterCard International,
were $44.8 million or 8.6 percent higher than the second quarter of 2006.
Second quarter earnings were impacted by ongoing expenses of $5.8 million
related to the retail banking initiative, compared to $0.9 million in the
second quarter of 2006. Earnings were also impacted by a reduction in interest
income resulting from lower cash balances due to the payment of a prior year
income tax reassessment related to dividends received from a reinsurance
investment.

    EARNINGS GUIDANCE

    The Company confirms its expectation that earnings per share in 2007 will
be in the range of $4.65 to $4.85, excluding non-operating items. Due to the
timing of store openings and expenses associated with various growth
initiatives, the Company expects third quarter earnings to be relatively flat
to the 2006 comparable period followed by a strong fourth quarter performance.

    FORWARD-LOOKING STATEMENTS

    This disclosure contains statements that are forward-looking. Actual
results or events may differ materially from those forecasted in this
disclosure because of the risks and uncertainties associated with Canadian
Tire's business and the general economic environment. Risks and uncertainties
are disclosed in other public filings by the Company, such as Management's
Discussion and Analysis in the 2006 Financial Report and include, but are not
limited to: changes in interest, currency exchange and tax rates; the ability
of Canadian Tire to attract and retain quality employees, Associate Dealers,
Petroleum agents and PartSource and Mark's Work Wearhouse store operators and
franchisees; and the willingness of customers to purchase the Company's
merchandise, financial products and services.
    Risk factors associated with the assumptions that underlie Canadian
Tire's forecasted performance in 2007, as outlined previously, and that have
the potential to affect the operating performance and results of the Company's
divisions include:

    
    -   expansion activity planned for Mark's, PartSource, Petroleum and CTR,
        including the associated supply chain infrastructure, could be
        affected by the Company's ability to acquire and develop suitable
        real estate properties and obtain municipal and other required
        government approvals, and the availability of construction material
        and labour at reasonable prices;
    -   unseasonable weather patterns could affect the sales of seasonal
        merchandise at CTR and Mark's, particularly in the second and fourth
        quarters which historically are these divisions' largest selling
        periods;
    -   adverse environmental occurrences could damage the Company's
        reputation or threaten its licenses to operate, particularly in the
        Petroleum division;
    -   changes in commodity prices could affect the profitability of
        Petroleum, CTR and Mark's;
    -   the earnings of Financial Services could be affected by customers'
        inability to repay their Canadian Tire credit card or personal loan
        balances or by an unsatisfactory response to the retail banking pilot
        initiative; and
    -   failure to comply with applicable laws and regulations could result
        in sanctions and financial penalties by regulatory bodies that could
        impact the Company's earnings and reputation. Areas of compliance
        include environment, health and safety, competition, transportation
        of dangerous goods, tax, customs and excise and regulations governing
        financial institutions.
    

    The Company has developed its 2007 forecast on the assumption that there
will not be a material deviation in the risks described in this disclosure
compared to the current operating environment. The Company cannot provide any
assurance that forecasted financial or operational performance will actually
be achieved, or if it is, that it will result in an increase in the price of
Canadian Tire shares.

    REVIEW BY BOARD OF DIRECTORS

    The Canadian Tire Board of Directors, on the recommendation of its Audit
Committee, has approved the contents of this disclosure.

    CONFERENCE CALL

    Canadian Tire will conduct a conference call to discuss information
included in this news release and related matters at 3:30 p.m. EST on
Thursday, August 9, 2007. The conference call will be available simultaneously
and in its entirety to all interested investors and the news media through a
webcast at http://investor.relations.canadiantire.ca, and will be available
through replay at this website for one month.

    Canadian Tire Corporation, Limited (TSX: CTC.a, CTC), operates more than
1,100 general merchandise and apparel retail stores, gas stations and car
washes in an inter-related network of businesses engaged in retail, financial
services and petroleum. Canadian Tire Retail, Canada's most shopped general
merchandise retailer, with 466 stores operated by Associate Dealers across
Canada offers a unique mix of products and services through three specialty
categories in which the organization is the market leader - Automotive, Sports
and Leisure, and Home Products. www.canadiantire.ca offers Canadians the
opportunity to shop online. PartSource is an automotive parts specialty chain
with 67 stores designed to meet the needs of purchasers of automotive parts -
professional automotive installers and serious do-it-yourselfers. Canadian
Tire Petroleum is one of the country's largest and most productive independent
retailers of gasoline, operating 264 gas bars, 256 convenience stores and
kiosks, and 75 car washes. Mark's Work Wearhouse is one of the country's
leading apparel retailers operating 341 stores in Canada. Under the Clothes
that Work(TM) marketing strategy, Mark's sells apparel and footwear in work,
work-related, casual and active-wear categories, as well as health-care and
business-to-business apparel. www.marks.com offers Canadians the opportunity
to shop online. Canadian Tire Financial Services manages over 4 million
Canadian Tire MasterCard accounts and markets related financial products and
services for retail and petroleum customers. Canadians can also access
Financial Services online at www.ctfs.com. Over 50,000 Canadians work across
Canadian Tire's organization from coast-to-coast in the enterprise's retail,
financial services, and petroleum businesses.



    Management's discussion and analysis (MD&A)
    -------------------------------------------------------------------------

    Introduction

    This Management's Discussion and Analysis (MD&A) provides management's
perspective on our Company, our performance and our strategy for the future.

    We, us, our, Company and Canadian Tire

    In this document, the terms "we", "us", "our", "Company" and "Canadian
Tire" refer to Canadian Tire Corporation, Limited and its business units and
subsidiaries.

    Review and approval by the Board of Directors

    The Board of Directors, on the recommendation of its Audit Committee,
approved the contents of this MD&A on August 9, 2007.

    Quarterly and annual comparisons in this MD&A

    Unless otherwise indicated, all comparisons of results for the second
quarter (13 weeks ended June 30, 2007) are against results for the second
quarter of 2006 (13 weeks ended July 1, 2006).

    Restated figures

    Certain of the prior period's figures have been reclassified to conform
to the current year presentation.

    Accounting estimates and assumptions

    The preparation of consolidated financial statements that conform with
Canadian generally accepted accounting principles (GAAP) requires us to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent liabilities at the date of the
Consolidated Financial Statements and the reported amounts of revenue and
expenses during the reporting period. We calculate our estimates using
detailed financial models that are based on historical experience, current
trends and other assumptions that are believed to be reasonable under the
circumstances. Actual results could differ from those estimates. In our
judgment, none of the estimates detailed in Note 1 of our Consolidated
Financial Statements for the quarter ended June 30, 2007 requires us to make
assumptions about matters that are highly uncertain. For these reasons, none
of the estimates is considered a "critical accounting estimate" as defined in
Form 51-102F1 published by the Ontario Securities Commission.

    Forward-looking statements

    This MD&A contains statements that are forward-looking. Actual results or
events may differ materially from those forecasted in this disclosure because
of the risks and uncertainties associated with Canadian Tire's business and
the general economic environment. In addition to the principal risks
identified in section 9.2 of the MD&A contained in our 2006 Financial Report,
there are other external factors that could affect our results. These include,
but are not limited to: changes in interest rates, currency exchange rates and
tax rates; the ability of Canadian Tire to attract and retain quality
employees, Associate Dealers, Petroleum agents and PartSource and Mark's store
operators and franchisees; and the willingness of customers to shop at our
stores or acquire our financial products and services.
    Other specific risk factors that may cause actual results or events to
differ materially from those forecasted in this MD&A include:

    
    -   expansion activity planned for Mark's Work Wearhouse (Mark's),
        PartSource, Canadian Tire Petroleum (Petroleum) and Canadian Tire
        Retail (CTR), as well as the associated supply chain infrastructure,
        could be affected by the Company's ability to acquire and develop
        real estate properties, obtain municipal and other required
        government approvals, access construction labour and materials at
        reasonable prices, lease suitable properties and weather conditions
        that could impact the timing of construction;
    -   unseasonable weather patterns could affect the sales of seasonal
        merchandise at CTR and Mark's throughout the year, particularly in
        the second and fourth quarters which historically are these
        divisions' largest selling periods;
    -   adverse environmental occurrences could damage the Company's
        reputation or threaten its licences to operate, particularly in the
        Petroleum division;
    -   changes in commodity prices could affect the profitability of
        Petroleum, CTR and Mark's;
    -   disruptions in the supply of gasoline could affect Petroleum's
        revenue and earnings;
    -   the earnings of Canadian Tire Financial Services (Financial Services)
        could be affected by customers' inability to repay their Canadian
        Tire credit card or loan balances or by an unsatisfactory response to
        the retail banking initiative; and
    -   failure to comply with applicable laws and regulations could result
        in sanctions and financial penalties by regulatory bodies that could
        impact our earnings and reputation. Areas of compliance include
        environmental, health and safety, competition law, transportation of
        dangerous goods, customs and excise tax and regulations governing
        financial institutions.
    

    We cannot provide any assurance that forecasted financial or operational
performance will actually be achieved, or if it is, that it will result in an
increase in the price of Canadian Tire shares.

    1.0 Our Company

    1.1 Overview of the business

    Canadian Tire has been in business for over 85 years, offering everyday
products and services to Canadians through its growing network of interrelated
businesses. Canadian Tire, our Associate Dealers, franchisees and Petroleum
agents operate more than 1,100 general merchandise and apparel retail stores,
gas stations and car washes. The Company also provides a variety of financial
services to Canadians, primarily its proprietary Options MasterCard(TM) and
Canadian Tire-branded credit cards, personal loans, insurance and warranty
products. In October 2006, Financial Services began offering high interest
savings accounts, guaranteed investment certificates and residential mortgages
in two pilot markets.
    Canadian Tire's model of interrelated businesses provides market
differentiation and competitive advantage. Canadian Tire's businesses benefit
from the Company's key capabilities in merchandising, marketing and
advertising, supply chain and real estate, which enable us to achieve a
greater level of efficiency. Canadian Tire's primary loyalty program, Canadian
Tire 'Money' - shared by CTR, Financial Services and Petroleum - is an example
of how interrelationships between the businesses create a strong competitive
advantage for the Company.
    Mark's has already derived meaningful cost and operating synergies from
Canadian Tire's strengths in real estate and supply chain since its
acquisition by the Company in 2002. Canadian Tire co-locates Mark's and
Canadian Tire stores in certain locations and, increasingly, is extending its
national marketing and advertising channels to boost customer traffic and
loyalty to Mark's and increase its brand penetration.

    Canadian Tire's four main businesses are described below.

    CTR is Canada's most shopped general merchandise retailer with a network
of 466 Canadian Tire stores that are operated by Associate Dealers, who are
independent business owners. Associate Dealers buy merchandise from the
Company and sell it to consumers in Canadian Tire stores. CTR also includes
our online shopping channel and PartSource. PartSource is a chain of 67
specialty automotive hard parts stores that cater to serious "do-it-
yourselfers" and professional installers of automotive parts. The PartSource
network consists of 45 franchise stores and 22 corporate stores.

    Mark's is one of Canada's leading clothing and footwear retailers,
operating 341 stores nationwide, including 291 corporate and 50 franchise
stores that offer men's wear, women's wear and industrial wear. Mark's
operates under the banner "Mark's", and in Quebec, "L'Equipeur". Mark's also
conducts a business-to-business operation under the "Imagewear by Mark's Work
Wearhouse" brand.

    Petroleum is Canada's largest independent retailer of gasoline with a
network of 264 gas stations, 256 convenience stores and kiosks, 75 car washes,
13 Pit Stops and 85 propane stations. The majority of Petroleum's sites are
co-located with Canadian Tire stores as a deliberate strategy to attract
customers to Canadian Tire stores. Substantially all of Petroleum's sites are
operated by agents.

    Financial Services markets a range of Canadian Tire-branded credit cards,
including the Canadian Tire Options MasterCard, Gas Advantage MasterCard and
Commercial Link MasterCard. Financial Services also offers personal loans,
insurance and warranty products and an emergency roadside assistance service
called "Canadian Tire Roadside Assistance". Canadian Tire Bank, a wholly-owned
subsidiary of Financial Services, is a federally regulated bank that manages
and finances Canadian Tire's MasterCard and retail credit card portfolios, as
well as the personal loan portfolio. In October 2006, Canadian Tire Bank began
offering high interest savings accounts, guaranteed investment certificates
and residential mortgages in two pilot markets and has extended this to a
third test market in 2007.

    2.0 Our strategy

    2.1 Five-year Strategic Plan

    Canadian Tire has a five-year Strategic Plan to guide the Company's
growth from 2005 to 2009. The Plan has five strategic imperatives outlined
below. Each of these imperatives is supported by specific initiatives,
outlined in section 4.0, on business segment performance.

    
    1 - grow sales and revenues
    2 - improve our earnings performance
    3 - embed a Customers for Life culture across our entire organization
    4 - extend growth and performance beyond 2009
    5 - enhance value creation through financial flexibility and maximization
        of the value of real estate assets
    

    2.2 Financial Aspirations

    As part of our initial strategic planning process, we developed five
financial aspirations that we believe are important and logical metrics for
both the Company and its shareholders to track progress against the Plan.
These metrics are not to be construed as guidance or forecasts for any
individual year within the Plan, but rather as long-term targets that we
aspire to achieve over the life of the Plan, based on the successful execution
of our various initiatives.

    
                                                                   2005-2009
    Financial Aspirations                                     Strategic Plan
    -------------------------------------------------------------------------
    Same store sales (see note below)
    (simple average of annual percentage growth,
     CTR stores only)                                               3% to 4%
    Gross operating revenue
    (compound annual growth rate)                                   7% to 9%

    EBITDA1 and minority interest
    (compound annual growth rate)                                 10% to 15%
    Basic earnings per share
    (compound annual growth rate)                                 12% to 15%
    After-tax return on invested capital
    (annual simple average)                                              10%
    -------------------------------------------------------------------------
    (1) Earnings before interest, income taxes, depreciation and
        amortization. See section 11.0 on non-GAAP measures.
    

    Same store sales

    Previously, we reported on CTR's comparable store sales growth as part of
our overall financial aspirations. Beginning in the fourth quarter of 2006, we
began reporting solely on CTR's same store sales growth and accordingly,
changed our financial aspirations to reflect our new practice. The key reasons
for the change in reporting were that same store sales growth is the metric
used by management and most commonly used in the retail industry and the same
store sales calculation will include the large number of store expansions
included in the Concept 20/20 store rollout, whereas the comparable store
sales metric did not.

    3.0 Our performance in 2007

    3.1 Consolidated results

    
    Consolidated financial results

    ($ in millions
     except per
     share amounts)    Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Retail sales(1)   $2,835.1  $2,696.6    5.1%  $4,641.4  $4,407.4    5.3%
    Gross operating
     revenue           2,316.7   2,247.6    3.1%   4,060.1   3,819.7    6.3%
    EBITDA(2) and
     minority interest   254.8     229.8   10.8%     418.4     373.5   12.0%
    Earnings before
     income taxes and
     minority interest   188.2     161.5   16.5%     287.4     239.5   20.0%
    Effective tax rate   35.0%     36.0%  (1.0)%     35.0%     36.0%  (1.0)%
    Net earnings         122.3     103.3   18.4%     186.8     150.9   23.8%
    Basic earnings
     per share        $   1.50  $   1.27   18.5%  $   2.29  $   1.85   23.9%
    Adjusted basic
     earnings
     per share(2)     $   1.35  $   1.23    9.2%  $   2.17  $   1.89   14.5%
    -------------------------------------------------------------------------
    (1) Represents sales at CTR (which includes PartSource), Mark's corporate
        and franchise stores and Petroleum's sites.
    (2) See section 11.0 for non-GAAP measures.


    Highlights of top-line performance by business

    (year-over-year
     percentage
     change)            Q2 2007   Q2 2006
    --------------------------------------
    CTR retail sales(1)    3.8%      5.3%
    CTR gross operating
     revenue             (0.1)%      9.7%
    CTR net shipments    (0.5)%     10.0%
    Mark's retail sales    9.7%     16.0%
    Petroleum retail
     sales                 9.7%     18.4%
    Petroleum gasoline
     volume                4.6%      1.5%
    Financial Services'
     credit card sales    16.1%     12.7%
    Financial Services'
     gross average
     receivables           6.6%     14.2%
    --------------------------------------
    (1) Includes sales from Canadian Tire
        stores, PartSource stores and CTR's
        online web store and the labour
        portion of CTR's auto service sales.
    


    Second quarter

    Consolidated gross operating revenue increased in the second quarter due
to higher sales at Mark's and Petroleum as well as growth in loans receivable
at Financial Services. CTR experienced a slight decrease in net shipments in
the second quarter, although net shipments are up approximately four percent
on a year to date basis, in line with CTR's sales growth.
    Higher operating revenue, margin improvements, lower expenses (as a
percentage of gross operating revenue) due to a focus on productivity, lower
interest costs due to reduced working capital, a lower effective tax rate and
the net impact of non-operating items noted below contributed to the strong
growth in earnings in the quarter.

    Impact of non-operating items

    The following tables show our consolidated earnings on a pre-tax and
after-tax basis, excluding non-operating gains and losses for the disposal of
shares, sales of loans receivable, disposals of property and equipment and
former chief executive officer (CEO) retirement obligations that occurred in
the second quarter of 2007.

    
    Adjusted consolidated earnings before income taxes and minority
    interest(3)

    ($ in millions)    Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Earnings before
     income taxes
     and minority
     interest         $  188.2  $  161.5   16.5%  $  287.4  $  239.5   20.0%
    Less pre-tax
     adjustment for:
      Gain on disposal
       /redemption of
       shares(1)          18.4       6.9              18.4       6.9
      Former CEO
       retirement
       obligations        (6.7)        -              (6.7)        -
      Gain (loss) on
       sales of loans
       receivable(1)       5.5      (3.4)              2.5     (16.1)
      Gain on
       disposals of
       property and
       equipment(2),(3)    2.3       0.9               1.7       4.0
    -------------------------------------------------------------------------
    Adjusted earnings
     before income
     taxes and
     minority
     interest(4)      $  168.7  $  157.1    7.3%  $  271.5  $  244.7   11.0%
    -------------------------------------------------------------------------

    (1) See section 4.4 on Financial Services' performance.
    (2) See section 4.1 for CTR's performance, section 4.2 for Mark's
        performance, section 4.3 for Petroleum's performance and section 4.4
        for Financial Services' performance.
    (3) Gain on disposals of property and equipment includes fair market
        value adjustments and impairments on property and equipment.
    (4) See section 11.0 on non-GAAP measures.
    

    On June 30, 2007, the employment agreement for Wayne Sales, the Company's
former CEO who has been the Company's Vice-Chairman since stepping down as CEO
in April 2006, terminated. The Company recorded a pre-tax charge of
$6.7 million in the second quarter to reflect the cost of previously unvested
share units he is now entitled to under the Company's share incentive program
(valued at the prevailing stock price on June 30, 2007), and other retirement
obligations. For further details, see section 5.4 below.
    In addition, while not considered a non-operating item and accordingly
included in normal operating earnings, the second quarter included
$9.8 million (2006 - $3.3 million) associated with the Company's various long
term incentive programs (LTIP). For further details, see section 5.4 below.

    
    Adjusted consolidated net earnings(1)

    ($ in millions
     except per
     share amounts)    Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Net earnings      $  122.3  $  103.3   18.4%  $  186.8  $  150.9   23.8%
    Less after-tax
     adjustment for:
      Gain on disposal
       /redemption
       of shares          12.0       4.4              12.0       4.4
      Former CEO
       retirement
       obligations        (4.4)        -              (4.4)        -
      Gain (loss) on
       sales of loans
       receivable          3.6      (2.2)              1.6     (10.3)
      Gain on disposals
       of property
       and equipment(1)    1.5       0.5               1.1       2.5
    -------------------------------------------------------------------------
    Adjusted net
     earnings(2)      $  109.6  $  100.6    9.1%  $  176.5  $  154.3   14.4%
    -------------------------------------------------------------------------
    Basic earnings
     per share        $   1.50  $   1.27   18.5%  $   2.29  $   1.85   23.9%
    Adjusted basic
     earnings per
     share(2)         $   1.35  $   1.23    9.2%  $   2.17  $   1.89   14.5%
    -------------------------------------------------------------------------
    (1) Includes fair market value adjustments and impairments on property
        and equipment.
    (2) See section 11.0 on non-GAAP measures.
    

    Seasonal impact

    We traditionally experience stronger revenues and earnings in the second
and fourth quarters of each year because of the seasonal nature of some
merchandise at CTR and Mark's and the timing of marketing programs. The
following table shows our financial performance by quarter for the last two
years.

    
    Consolidated quarterly results

    ($ in millions except
     per share amounts)                Q2 2007   Q1 2007   Q4 2006   Q3 2006
    -------------------------------------------------------------------------
    Gross operating revenue(1)        $2,316.7  $1,743.4  $2,426.1  $2,023.3
    Net earnings                         122.3      64.5     108.3      95.4
    Basic earnings per share              1.50      0.79      1.33      1.17
    Fully diluted earnings per share      1.50      0.79      1.32      1.16
    -------------------------------------------------------------------------


    ($ in millions except
     per share amounts)                Q2 2006   Q1 2006   Q4 2005   Q3 2005
    -------------------------------------------------------------------------
    Gross operating revenue(1)        $2,247.6  $1,572.1  $2,304.3  $1,888.6
    Net earnings                         103.3      47.6     118.2      84.4
    Basic earnings per share              1.27      0.58      1.44      1.03
    Fully diluted earnings per share      1.25      0.58      1.43      1.02
    -------------------------------------------------------------------------
    (1) Quarterly gross operating revenue for 2005 has been restated for the
        impact of EIC-156 as required by the CICA. See section 11.3 in our
        2006 Financial Report MD&A for additional information.


    4.0 Business segment performance

    4.1 Canadian Tire Retail

    4.1.1 Strategic Plan update and outlook

    The following outlines CTR's performance in the second quarter of 2007 in
the context of the 2005-2009 Strategic Plan, and provides an outlook for 2007
and for the full Plan period.

    -------------------------------------------------------------------------
    Strategic Plan update and outlook
    -------------------------------------------------------------------------

    Concept 20/20 store program

    Concept 20/20 is the cornerstone of Canadian Tire Retail's current growth
    agenda. Concept 20/20 stores are experiencing strong first, second and
    third year sales, caused by increases in customer traffic and average
    transaction value, thereby providing the potential for a more attractive
    return on investment than previous store formats. Concept 20/20 same
    store sales were strong in the second quarter of 2007, up 4.4% year-over-
    year. On average, customers spend 40 percent more time in Concept 20/20
    stores than in other store formats, demonstrating that the attractive
    Concept 20/20 store design, product displays and open-plan layout
    encourages customers to browse the stores, increasing the likelihood of
    incremental purchases. The strong sales performance of Concept 20/20 led
    to the decision to accelerate the store rollout in 2006 and 2007.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Second quarter                       CTR plans to open approximately 270
    CTR opened three new Concept 20/20   Concept 20/20 stores between 2005
    stores in the quarter, two of        and 2009.
    which were replacement stores.
                                         In 2007 CTR originally planned to
    CTR expanded and retrofitted 30      open approximately 70 Concept 20/20
    new-format stores and one existing   stores, adding 1.6 million retail
    smaller Concept 20/20 store to the   square feet as follows:
    Concept 20/20 format and closed      -  19 new Concept 20/20 stores,
    two traditional stores and one          including 10 replacement stores
    new-format store.                    -  51 expansions and retrofits

    At the end of Q2 2007, CTR had       CTR currently anticipates opening
    466 stores, including 165 Concept    approximately 67 stores and will add
    20/20 stores (of which 21 are        1.5 million retail square feet
    Concept 20/20 Canadian Tire-Mark's   as follows:
    Work Wearhouse combination stores).  -  18 new Concept 20/20 stores,
    CTR added approximately 589,000         including 10 replacement stores
    retail square feet to the network    -  49 expansions and retrofits
    (net of reductions due to store
    closures) for a total of
    17.0 million at the end of the
    quarter.

    -------------------------------------------------------------------------
    Exciting, new and exclusive (ENE) products

    Canadian Tire has built a reputation for offering innovative products.
    CTR's objective is to introduce new products into the market that are
    only available at Canadian Tire. Examples of ENE products include
    cordless lawn mowers, solar-paneled tents that light up at night and
    flexible wiper blades.
    -------------------------------------------------------------------------
    2007 Performance                     2005-2009 Plan
    -------------------------------------------------------------------------
    In the second quarter, retail        CTR planned to increase sales of
    sales of ENE products decreased by   ENE products by approximately
    15.1 percent compared to the         10 percent in 2007 and is currently
    second quarter of 2006. The          in the process of re-assessing this
    decrease in the second quarter was   goal.
    due to the timing of ENE product
    sales and a strong comparable
    second quarter for particular ENE
    items in 2006.
    -------------------------------------------------------------------------
    Global sourcing

    Canadian Tire is increasing the percentage of foreign-sourced products
    carried in its stores. The benefits of global sourcing are three-fold:
    access to innovative products; margin protection; and the ability to
    offer compelling price points.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    In the second quarter,               CTR plans to increase the percentage
    approximately 39 percent of          of products sourced from suppliers
    products sold in CTR's retail        outside of North America to
    stores were purchased from           approximately 50 percent by the end
    suppliers outside North America.     of 2009.
    -------------------------------------------------------------------------
    PartSource network expansion

    PartSource will continue its expansion into new markets through a
    combination of opening new stores and small-scale acquisitions.
    PartSource's strategy to buy small local businesses and convert them to
    the PartSource banner has proven successful, with high rates of customer
    retention after conversion. PartSource began testing corporate stores in
    2005, and due to the initial success of the pilot, will continue to roll
    out corporate stores.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Second quarter                       PartSource plans to increase its
                                         network to at least 100 stores by
    -  opened two new corporate stores,  the end of 2009.
       converted two franchise stores
       to corporate stores and           In 2007, PartSource plans to add
       acquired one new franchise        eight new stores through a
       store.                            combination of new store openings
                                         and small-scale acquisitions.
    PartSource had a total of 67
    stores at the end of the second      PartSource and CTR will also
    quarter of 2007, including 22        undertake enhancements to the
    corporate stores and 45 franchise    automotive parts supply chain to
    stores.                              support continued growth and
                                         efficiency in PartSource and CTR.

    -------------------------------------------------------------------------
    Inventory practices program

    CTR's long-term objective is to ship more than 90 percent of products to
    stores on-time. In addition, CTR is working with Associate Dealers to
    improve ordering and shipping processes to better align the flow of
    product to customer purchasing patterns, thereby reducing corporate and
    store inventory levels and operational complexity, and increasing
    inventory turns.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    In the second quarter of 2007, the   CTR originally targeted 13 inventory
    percentage of products shipped       turns by the end of 2009, but due to
    on-time to stores increased          changes to Associate Dealer ordering
    marginally, to 90.5 percent          practices and buying patterns, this
    compared to 90.4 percent in the      target is being re-evaluated.
    second quarter of 2006.

    Inventory turns for the second
    quarter of 2007, based on cubic
    volume, increased to 10.5 from 9.9
    in the second quarter of 2006.
    -------------------------------------------------------------------------

    4.1.2 Key performance indicators

    The following are key measures of CTR's sales productivity:
    -   total same store sales growth
    -   average retail sales per store
    -   average sales per square foot of retail space
    -   average transaction value

    CTR total retail and same store sales

    (year-over-year percentage change) Q2 2007   Q2 2006  2007 YTD  2006 YTD
    -------------------------------------------------------------------------

    Total retail sales(1)                 3.8%      5.3%      3.5%      5.1%

    Same store sales                      1.7%      3.3%      1.5%      3.2%
    -------------------------------------------------------------------------
    (1) Includes sales from Canadian Tire stores, PartSource stores, sales
        from CTR's online web store and the labour portion of CTR's auto
        service sales.


    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    CTR's retail sales

    Retail sales represent total merchandise sold at retail prices and the
    labour portion of automotive sales to consumers across CTR's network of
    stores, including CTR's online web store and PartSource.
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    CTR same store sales(1) by store format

    (year-over-year percentage change) Q2 2007  2007 YTD
    -----------------------------------------------------
    Same store sales
      Concept 20/20 stores                4.4%      5.0%
      New-format stores                 (0.3)%    (0.8)%
      Traditional stores                (0.8)%    (0.9)%
    -----------------------------------------------------
    (1) Same store sales excludes PartSource

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    CTR's same store sales

    Same store sales include sales from all stores that have been open for
    more than 53 weeks.
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Historically, Concept 20/20 stores were classified as "new-format" stores
in our financial disclosures. As of Q4 2006, we have been reporting three
separate classes of stores, defined as follows:

    -------------------------------------------------------------------------
     Concept 20/20 store       New-format store         Traditional store
           format                   format                   format
     (mid 2003 to 2007)       (1994 to mid 2003)        (1994 and prior)
       Average retail           Average retail           Average retail
       square footage:          square footage:          square footage:
           53,000                   33,000                   16,000
    -------------------------------------------------------------------------
    Larger format launched   Large format,            Smaller than either the
    in September 2003,       including "Class Of"     new-format or Concept
    ranging in size from     and "Next Generation"    20/20 stores on
    24,000 to 89,000         stores, ranging in       average. Traditional
    square feet. Concept     size from 16,000 to      stores are
    20/20 stores make up     66,000 square feet,      characterized by varied
    approximately            most of which were       sizes and layouts.
    50 percent of the        opened between 1994      Traditional stores make
    retail square footage    and mid 2003. New-       up approximately
    of the network. See      format stores make up    10 percent of the
    section 4.1.1,           approximately            retail square footage
    Strategic Plan update    40 percent of the        in the network.
    and outlook, for more    retail square footage
    information on the       in the network. This
    Concept 20/20 rollout.   format immediately
                             preceded the Concept
                             20/20 format.
    -------------------------------------------------------------------------

    CTR store count

                             Q2 2007      2006      2005      2004      2003
    -------------------------------------------------------------------------
    Concept 20/20 stores         165       126        53        25         4
    New-format stores            205       237       292       302       305
    Traditional stores            96       105       117       130       143
    -------------------------------------------------------------------------
    Total new-format,
     traditional and
     Concept 20/20 stores        466       468       462       457       452
    PartSource stores             67        63        57        47        39
    -------------------------------------------------------------------------
    

    CTR continues to expand and retrofit its Concept 20/20 store network,
consistent with the goals embodied in the 2005-2009 Strategic Plan and
consumer preference for this store format, as evidenced by the same store
sales trends. Retail sales in Concept 20/20 stores accounted for 45 percent of
total retail sales in the second quarter.
    The total store count declined in the second quarter due to the closure
of two traditional stores and one new format store.

    
    Average retail sales per Canadian Tire store(1),(2)

    ($ in millions)
                                      For the 12 months    For the 12 months
                                     ended June 30, 2007  ended July 1, 2006
    -------------------------------------------------------------------------
    Concept 20/20 stores                         $  19.9             $  19.5
    New-format stores                               14.8                14.5
    Traditional stores                               7.9                 7.9
    (1) Retail sales are shown on a 52-week basis in each year and exclude
        sales from PartSource stores, CTR's online web store and the labour
        portion of CTR's auto service sales.
    (2) Only includes stores that have been open for a minimum of two years
        as at the end of the quarter.
    

    Sales at new-format and Concept 20/20 stores are higher than at
traditional stores as they are larger, have a more convenient layout and offer
a broader selection of merchandise. The average dollar amount of each retail
sale transaction at new-format and Concept 20/20 stores continues to increase
partly because they allow for larger displays of promotional, seasonal and ENE
products, which are key sales drivers. With the increasing number of larger
Concept 20/20 stores, this overall trend is continuing. Some of the most
recent Concept 20/20 store openings, however, have experienced a lower than
historical initial sales uplift due in part to lower than expected grand
opening results, particularly in the Montreal area, as well as some store
specific issues. Management is currently addressing these issues.

    
    Average sales per square foot of Canadian Tire retail space(1),(2)

                                      For the 12 months    For the 12 months
                                     ended June 30, 2007  ended July 1, 2006
    -------------------------------------------------------------------------
    Retail square footage(1)
     (millions of square feet)                      17.0                15.5
    Concept 20/20 stores(2),(3)($)                 $ 385               $ 377
    New-format stores(2),(3)($)                      451                 444
    Traditional stores(2),(3)($)                     509                 507
    -------------------------------------------------------------------------
    (1) Retail square footage is based on the total retail square footage
        including stores that have not been open for a minimum of two years
        as at the end of the quarter.
    (2) Retail sales are shown on a 52-week basis in each year for those
        stores that have been open for a minimum of two years as at the end
        of the quarter. Sales from PartSource stores, CTR's online web store
        and the labour portion of CTR's auto service sales are excluded.
    (3) Retail space does not include warehouse, garden centre and auto
        service areas.
    

    Average sales per square foot of retail space in the larger store formats
are lower than in traditional stores, because the additional space is utilized
to display more merchandise, accommodate wider aisles and include more
appealing product displays.  The larger store formats generate higher sales
overall and offer a more compelling shopping experience.

    Retail sales growth

    CTR's second quarter retail sales grew 3.8 percent and same store sales
increased 1.7 percent over the prior year, while same store sales at the new
Concept 20/20 stores increased a strong 4.4 percent.  The modest same store
sales growth in the second quarter reflected a very weak retail environment in
the month of April (down 5.6 percent), followed by stronger May and June
retail sales (up 7.2 percent). It should be noted that Q2 2007 sales benefited
by an extra selling day in comparison with the prior year comparable period.
    From a product category perspective, seasonal spring and summer
businesses were up 5 percent, with strong sales registered in patio furniture,
camping and car care and accessories. Retail sales for non-seasonal businesses
grew 2.7 percent with strength registered in kitchen, home appliances and
organizational categories, offset, in part, by softer sales in the home repair
and hardware categories.
    On a regional basis, strong retail sales were registered in Western
Canada (particularly Alberta) while Ontario and Quebec were relatively softer,
reflecting, in part, their relatively softer regional economies.
    PartSource experienced strong double digit total sales growth in the
second quarter, driven by the continued expansion of the corporate store
network and growth in the commercial customer segment. PartSource also
achieved strong single digit comparative store sales growth in the quarter.

    Temporary impact of stores being converted to the Concept 20/20 format

    During the construction and remerchandising of stores undergoing
conversion to the Concept 20/20 format, sales are negatively impacted. 
Excluding the impact of the stores undergoing conversion, same store sales
were 2.4 percent higher in the second quarter of 2007 compared with the second
quarter of 2006.

    4.1.3 CTR's financial results

    
    ($ millions)       Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Retail sales      $2,141.9  $2,064.4    3.8%  $3,384.4  $3,269.5    3.5%
    Net shipments
     (year-over-year
     % change)          (0.5)%     10.0%              3.9%              5.9%
    Gross operating
     revenue          $1,517.5  $1,518.8  (0.1)%  $2,592.2  $2,488.0    4.2%
    EBITDA(1) and
     minority interest   150.5     161.4  (6.7)%     249.5     258.9  (3.6)%
    Earnings before
     income taxes and
     minority interest    88.7      97.9  (9.4)%     128.7     136.4  (5.7)%
    -------------------------------------------------------------------------
    Less adjustment
     for:
      Former CEO
       retirement
       obligations(2)     (6.7)        -              (6.7)        -
      Gain on
       disposals of
       property and
       equipment(3)        3.7       1.3               3.7       4.7
    -------------------------------------------------------------------------
        Adjusted
         earnings
         before
         income
         taxes and
         minority
         interest(1)  $   91.7  $   96.6  (5.1)%  $  131.7  $  131.7    0.0%
    -------------------------------------------------------------------------
    (1) See section 11.0 on non-GAAP measures.
    (2) As described in Section 3.1 above.
    (3) Includes fair market value adjustments and impairments on property
        and equipment.
    

    CTR's net shipments

    CTR's net shipments are the total value of merchandise shipped to
Canadian Tire Associate Dealer stores and PartSource franchise stores, at
wholesale prices, net of returns, discounts and other adjustments. CTR
shipments also include retail sales at PartSource corporate stores.

    Explanation of CTR's financial results - revenue

    Gross operating revenue decreased slightly, in spite of the higher retail
sales, due to lower net shipments to Associate Dealer stores due to a reversal
of the performance experienced in the first quarter where the growth in
shipments exceeded sales growth.  The level of both retail and corporate
inventory is considered appropriate to meet forecasted demand. The softer
shipment revenue was offset in part by higher rent charged to Associate
Dealers due to higher retail sales.

    
    Explanation of CTR's financial results - adjusted operating margins

    ($ millions)       Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    EBITDA
     - adjusted(1)    $  153.5  $  160.1  (4.1)%  $  252.5  $  254.2  (0.7)%
    Gross operating
     revenue (GOR)     1,517.5   1,518.8  (0.1)%   2,592.2   2,488.0    4.2%
    EBITDA - adjusted
     as a % of GOR       10.1%     10.5%  (0.4)%      9.7%     10.2%  (0.5)%
    -------------------------------------------------------------------------
    (1) Excludes former CEO retirement obligations and gain on disposal of
        property and equipment (see above).
    

    The decline in the adjusted EBITDA margin in the second quarter primarily
reflects CTR's share of the charge associated with the change to the LTIP
program referred to above. Excluding those costs, adjusted EBITDA for the
second quarter, expressed as a percentage of GOR, would have remained
consistent with the prior year as an improvement in gross margins.
Productivity improvements were substantially offset by the impact of a
favourable property tax adjustment recorded in the prior year comparative.

    4.1.4 Business risks

    CTR is exposed to a number of risks in the normal course of its business
that have the potential to affect its operating performance. These risks
include, but are not limited to, supply chain disruption risk, seasonality
risk and environmental risk. These specific risks and management's mitigation
strategies are explained in more detail in Section 4.2.1.5 of our 2006
Financial Report.
    Please also refer to section 8.0 of this MD&A for a discussion of some
other industry-wide and Company-wide risks affecting the business.

    4.2 Mark's Work Wearhouse

    4.2.1 Strategic Plan update and outlook

    The following outlines Mark's performance in the second quarter of 2007
in the context of the 2005-2009 Strategic Plan, and provides an outlook for
2007 and for the full Plan period.

    
    -------------------------------------------------------------------------
    Strategic Plan update and outlook

    Network expansion

    Mark's is focused on achieving "Superbrand" status for the Mark's name,
    with the objective of capturing an increasingly significant share of
    overall apparel sales in each geographic market and in each category in
    which Mark's competes. To increase Mark's market presence, the Company
    has an aggressive plan of continuing to expand the network of Mark's
    stores. Mark's also plans to expand, renovate and relocate some existing
    stores to the latest Mark's format.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Second quarter
    -   opened two new corporate stores  Mark's plans to expand the network
        and closed one corporate store   to approximately 400 stores by the
    -   relocated four corporate stores  end of 2009.
    -   expanded one franchise store
                                         2007 Outlook
    Mark's total retail square footage
    at the end of the second quarter     In 2007, Mark's now expects to open
    of 2007 was 2.8 million square       only 22 of its 29 planned new stores
    feet.                                due to the timing of the
                                         availability of new store sites.
                                         Mark's is now on target to expand,
                                         relocate or renovate 26 stores.
                                         Mark's now expects to increase its
                                         total retail square feet by
                                         approximately 12 percent in 2007.

    -------------------------------------------------------------------------
    Category expansion

    Mark's plans to grow through continued expansion of its three major
    categories: men's casual and dress wear; women's wear and industrial
    wear. The expansion of the women's wear category has enabled Mark's to
    leverage female customer traffic in the stores. Mark's is also leveraging
    its reputation for product integrity by designing and marketing new,
    innovative "Clothes That Work" items.

    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Second quarter
    -   total corporate store sales of   Mark's will continue to develop and
        women's wear increased by        expand high-potential product
        13.1 percent                     categories.
    -   total corporate store sales of
        men's wear increased by
        7.6 percent
    -   total corporate store sales of
        industrial wear increased by
        10.7 percent
    -------------------------------------------------------------------------

    4.2.2 Key performance indicators

    The following are key performance indicators for Mark's:
    -   retail and same store sales growth
    -   average sales per corporate store
    -   average sales per square foot of retail space

    Mark's retail and same store sales growth

    (year-over-year
     percentage change)                Q2 2007   Q2 2006  2007 YTD  2006 YTD
    -------------------------------------------------------------------------
    Total retail sales                    9.7%     16.0%     13.0%     14.0%

    Same store sales(1)                   6.9%     15.2%     10.6%     13.0%
    -------------------------------------------------------------------------
    (1) Mark's same store sales excludes new stores, stores not open for the
        full period in each year and store closures.
    

    Mark's retail sales

    Mark's retail sales represent total merchandise sales to consumers and
business-to-business customers, net of returns across Mark's entire network of
stores, including Mark's on-line web store, recorded at retail prices.
    Retail sales for the quarter grew in all regions, with strong results in
Quebec (increase in total retail sales of 18.2 percent with same store sales
increase of 10.4 percent), the British Columbia region (increase of
12.0 percent and same store sales increase of 12.1 percent) and Atlantic
region (increase of 11.3 percent and same store sales increase of 6.9
percent).
    From a product category perspective, in the quarter, corporate store
retail sales of women's wear were up 13.1 percent with the largest dollar
increases occurring in knits and casual and dress bottoms. Corporate store
retail sales of men's casual and dress wear were up 7.6 percent with the
largest dollar increases occurring in casual footwear and knit tops. Corporate
store retail sales of Mark's industrial wear business were up 10.7 percent
with the largest dollar increases occurring in industrial footwear.

    
    Average corporate store sales(1)
                                                 For the   For the   For the
                                               12 months 12 months 12 months
                                                   ended,    ended,    ended,
                                                 June 30,   July 1,   July 2,
                                                    2007      2006      2005
    -------------------------------------------------------------------------
    Average retail sales per store
     ($ thousands)(2)                           $  2,867  $  2,526  $  2,233
    Average sales per square foot ($)(3)             347       322       292
    -------------------------------------------------------------------------
    (1) Calculated on a rolling 12-month basis.
    (2) Average retail sales per corporate store include corporate stores
        that have been open for 12 months or more.
    (3) Average sales per square foot is based on sales from corporate
        stores. We have prorated square footage for corporate stores that
        have been open for less than 12 months.


    Mark's continues to improve the productivity of its stores, as
demonstrated by a 7.9 percent increase in corporate store sales per square
foot for the rolling 12 months ended June 30, 2007. The increases in sales
productivity are related to an attractive value proposition and a strong
product assortment.

    4.2.3 Mark's financial results

    ($ millions)       Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Retail sales(1)   $  221.3  $  201.9    9.7%  $  399.7  $  353.6   13.0%
    Gross operating
     revenue(2)          187.2     170.1   10.1%     339.3     298.8   13.6%
    EBITDA(3)             29.7      25.0   19.1%      45.7      37.8   21.1%
    Earnings before
     income taxes         24.5      20.3   20.7%      35.8      28.7   24.7%
    -------------------------------------------------------------------------
    Less adjustment for:
    Loss on disposals
     of property and
     equipment(4)         (0.4)        -              (0.6)     (0.1)
    -------------------------------------------------------------------------
    Adjusted earnings
     before income
     taxes(3)         $   24.9  $   20.3   22.2%  $   36.4  $   28.8   26.1%
    -------------------------------------------------------------------------
    (1) Includes retail sales from corporate and franchise stores.
    (2) Gross operating revenue includes retail sales at corporate stores
        only.
    (3) See section 11.0 on non-GAAP measures.
    (4) Adjusted earnings reflects losses on disposals of property and
        equipment that were not previously disclosed in Q2 2006.
    

    Explanation of Mark's second quarter financial results

    The 10.1 percent increase in gross operating revenue is attributable
primarily to the growth in corporate same store sales combined with the
cumulative impact of new store builds and the conversion of franchisees to
corporate stores.
    Pre-tax income increased 20.7 percent due to higher sales combined with a
120 basis point improvement in gross margin. Margin improvement reflects
increased purchase markups due primarily to Mark's on-going global sourcing
initiative, combined with favourable foreign exchange rates. Operating
expenses increased by 10.3 percent, less than the 12.9 percent increase in
gross margin dollars and franchise royalties combined, due to improved overall
productivity.

    4.2.4 Business risks

    Mark's is exposed to a number of risks in the normal course of its
business that have the potential to affect its operating performance. These
include, but are not limited to, seasonality risk and market obsolescence
risk. These risks and management's mitigation strategy are explained in more
detail in Section 4.2.2.5 of the MD&A contained in our 2006 Financial Report.
    Please also refer to section 8.0 of this MD&A for a discussion of some
other industry and Company-wide risks affecting the business.

    4.3 Canadian Tire Petroleum

    4.3.1 Strategic Plan update and outlook

    Petroleum plays a strategic role in increasing customer loyalty and
driving revenue and earnings for CTR and Financial Services. Petroleum
increases Canadian Tire's total value proposition by offering Canadian Tire
'Money' loyalty rewards on gas and ancillary purchases paid for in cash or by
Canadian Tire's Options MasterCard. Petroleum also supports other interrelated
promotions and joint product launches, such as Canadian Tire's Gas Advantage
MasterCard, which has gained wide popularity since its introduction in Ontario
in mid-2006. Customers who purchase gas at Petroleum and have a Canadian Tire
MasterCard are Canadian Tire's most loyal and profitable customers.
    The following outlines Petroleum's performance in the second quarter of
2007 in the context of the 2005-2009 Strategic Plan, and provides an outlook
for 2007 and for the full Plan period.

    
    -------------------------------------------------------------------------
    Strategic Plan update and outlook
    -------------------------------------------------------------------------
    Site renewal and expansion

    Petroleum is focusing on modernizing existing sites and adding new sites
    in high-potential markets. On an opportunistic basis, Petroleum will also
    continue its re-branding initiative to convert competitor sites to the
    Canadian Tire brand.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Second quarter
    In the second quarter, Petroleum     Management will continue to
    opened one new gas station and       evaluate the appropriate level of
    closed two gas stations.             investment in Petroleum on an
                                         annual basis.
    Petroleum also opened one new
    convenience store and closed one     2007 Outlook
    convenience store. There was no      In 2007, Petroleum originally
    activity in the number of car wash   planned to open nine new petroleum
    locations during the quarter.        sites in strategic locations and
                                         invest in the modernization of
    At the end of the quarter,           approximately 25 existing sites.
    Petroleum had 264 gas stations,
    including 42 re-branded sites,       To date in 2007, Petroleum has
    and 256 convenience stores.          opened five new locations and
                                         refurbished six sites. Petroleum
                                         still plans to open nine new
                                         petroleum sites and to refurbish
                                         approximately 25 sites by the end
                                         of 2007.
    -------------------------------------------------------------------------
    Enhancing interrelatedness

    Petroleum's business is integrated with CTR and Financial Services
    through Canadian Tire 'Money' and various cross-marketing programs
    designed to build customer loyalty. Petroleum is also exploring the
    potential of interrelated programs with Mark's to extend Petroleum's
    marketing leverage across the Company.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Petroleum's cross-marketing          In 2007, Petroleum will
     programs include:                   aggressively seek out additional
    -   'Multiplier' coupons that        cross-marketing opportunities to
        increase the Canadian Tire       leverage its customer loyalty to
        'Money' offered on gas           drive sales and earnings across the
         purchases paid for in cash or   enterprise.
         by the Canadian Tire Options
         MasterCard
    -   coupons offering discounts on
        Canadian Tire merchandise with
        the purchase of gas
    -   the Gas Advantage MasterCard
        rolled out in Ontario in
        mid-2006
    -   car wash vouchers available for
        purchase at Canadian Tire
        retail stores which began
        rollout in Q1 2007

    The Gas Advantage MasterCard has
    been very successful in Ontario
    and is being tested in the Quebec
    market in 2007.
    -------------------------------------------------------------------------


    4.3.2 Key performance indicators

    Gasoline sales volume is a key top-line performance indicator for
Petroleum, as measured by the number of gasoline litres sold. Fluctuations in
the wholesale and retail price of gasoline may result in fluctuations in
Petroleum's margin and profitability.

    Gasoline sales volume

                       Q2 2007   Q2 2006  Change  YTD 2007  YTD 2006  Change
    -------------------------------------------------------------------------
    Sales volume
     (millions of
     litres)             437.4     418.0    4.6%     852.7     802.8    6.2%
    -------------------------------------------------------------------------

    Strong performance by the Gas Advantage MasterCard in Ontario, market
share gains and the cumulative effect of new site openings over the past few
quarters continued to drive gasoline volume in the second quarter of 2007,
despite the higher retail pump prices. On a comparable site basis, gasoline
volume increased by 3.2 percent in the quarter driven mainly by the Gas
Advantage MasterCard and an improvement in the Western Canada loyalty program.

    Petroleum's convenience and car wash sales

    (year-over-year
    percentage change)                 Q2 2007   Q2 2006  2007 YTD  2006 YTD
    -------------------------------------------------------------------------
    Total retail sales
      Convenience store sales            18.0%     14.0%     17.5%     11.7%
      Car wash sales                     20.8%      6.2%     20.8%     (3.5)%
    -------------------------------------------------------------------------
    Comparable sales
      Convenience(1)                     13.0%      7.5%     12.7%      6.0%
      Car wash                           17.7%     (6.7)%    17.4%    (16.0)%
    -------------------------------------------------------------------------
    (1) Comparable convenience sales excludes three "Q" convenience stores.

    The cumulative effect of the increase in network sites and the
effectiveness of merchandise displays in refurbished stores drove the increase
in convenience store sales in the second quarter of 2007. The cumulative
impact of the increase in the number of sites, the rollout of car wash
vouchers available for purchase at CTR stores and softness experienced in the
comparable period of the prior year contributed to higher total car wash sales
for the current quarter.

    4.3.3 Petroleum's financial results

    ($ in
    millions)      Q2 2007   Q2 2006    Change  2007 YTD  2006 YTD    Change
    -------------------------------------------------------------------------
    Retail sales  $  471.9  $  430.3      9.7%  $  857.3  $  784.3      9.3%
    Gross
     operating
     revenue         445.6     408.1      9.2%     808.4     743.2      8.8%
    EBITDA(1)         10.5       2.5    331.9%      17.0       7.8    118.7%
    Earnings (loss)
     before income
     taxes             6.4      (1.2)   611.9%       8.9       0.5  1,787.4%
    -------------------------------------------------------------------------
    Less adjustment
     for:
      Loss on
       disposals
       of property
       and
       equipment(2)   (1.0)     (0.2)               (1.3)     (0.3)
    -------------------------------------------------------------------------
    Adjusted
     earnings
     (loss) before
     income
     taxes(1)     $    7.4  $   (1.0)   818.6%  $   10.2  $    0.8  1,233.2%
    -------------------------------------------------------------------------
    (1) See section 11.0 on non-GAAP measures.
    (2) including asset impairment losses.
    

    Petroleum's retail sales

    Retail sales include the sales of gasoline at Petroleum's network of
petroleum sites, including re-branded sites, recorded at retail pump prices,
and excluding goods and services taxes and provincial sales taxes, where
applicable. Retail sales also include sales of products sold at our
convenience stores, car wash sales, propane and PitStop sales, all of which we
record at retail selling prices.

    Gasoline pricing

    Petroleum buys gasoline at wholesale cost, which varies by geographic
region, and sells it at market prices. Petroleum has a multi-year contract
with a major supplier to purchase, at competitive rates, the majority of its
gasoline requirements.

    Explanation of Petroleum's financial results

    Growth in gasoline volume, sustained increases in pump prices in key
markets and double-digit increases in convenience and car wash sales
contributed to Petroleum's revenue growth in the second quarter.
    Retail prices in the key Ontario market increased and exhibited less
volatility during the quarter and contributed to a significant improvement in
gasoline margins. Margins were also favourably impacted by changes to
marketing programs during the current year. Petroleum incurred $1.8 million in
environmental expenses for site remediation during the quarter.

    4.3.4 Business risks

    Petroleum is exposed to a number of risks in the normal course of its
business that have the potential to affect its operating performance. These
include, but are not limited to, commodity price risk and environmental
remediation risk. These risks and management's mitigation strategy are
explained in more detail in Section 4.2.3.5 of the MD&A contained in our
2006 Financial Report.
    Please also refer to section 8.0 for a discussion of some other
industry-wide and Company-wide risks.

    4.4 Canadian Tire Financial Services

    4.4.1 Strategic Plan update and outlook

    The following outlines Financial Services' performance in the second
quarter of 2007 in the context of the 2005-2009 Strategic Plan, and provides
an outlook for 2007 and for the full Plan period.

    
    -------------------------------------------------------------------------
    Strategic Plan update and outlook

    -------------------------------------------------------------------------
    Total managed portfolio of loans receivable (credit card, personal and
    residential mortgage loans)

    Financial Services plans to grow its portfolio through increases in
    average balances, new account acquisition, the introduction of new credit
    cards and continued testing of the personal loan and retail banking
    products. Financial Services is leveraging its low-cost in-store
    acquisition program as a high-volume channel to grow the base of customer
    accounts. The average balance on customer accounts is gradually
    increasing through initiatives such as low-rate balance transfer offers.
    In addition, management believes that there are further opportunities to
    grow the customer base by introducing premium and specialty credit cards
    with different bonus features. The Gas Advantage MasterCard, for example,
    offers a compelling customer value proposition which drives credit card
    balances while increasing gasoline volume at Petroleum. The average
    balance on Financial Services' credit card accounts at the end of the
    second quarter is $1,872, well below the industry average of over $2,600,
    which translates into a substantial long-term growth opportunity.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Second quarter
    Gross average loans receivable were  Over the 2005-2009 Plan period,
    $3.6 billion in the second quarter,  Financial Services plans to
    up 6.6 percent from the second       increase the number of accounts
    quarter of 2006. The growth          with balances by three to four
    reflects a 6.1 percent increase in   percent annually.
    the average account balance.
                                         2007 Outlook
    Credit card gross average loans      Financial Services plans to
    receivable were $3.4 billion in the  increase total portfolio gross
    second quarter, up 9.8 percent from  average loans receivable to
    the second quarter of 2006. The      $3.7 billion in 2007 and is on
    growth reflects primarily a 9.0      target to achieve that goal.
    percent increase in average account
    balances.                            Financial Services also plans to
                                         introduce at least one new credit
                                         card product and expand the Gas
                                         Advantage MasterCard into other
                                         regions of the country, beginning
                                         with Quebec.
    -------------------------------------------------------------------------
    Insurance and other ancillary products

    Financial Services plans to enhance its insurance and warranty product
    offerings to credit card customers. Revenues from insurance and warranty
    products have increased significantly in the last four years through
    direct marketing to Canadian Tire's growing base of customers.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Revenues from insurance and          Financial Services plans to
    warranty products increased          increase revenues from insurance
    10.8 percent in the second quarter   and warranty products by
    of 2007 year-over-year.              approximately six percent on a
                                         compound annual basis over the
                                         2005-2009 Plan period.

                                         2007 Outlook
                                         Financial Services plans to increase
                                         revenues from insurance and warranty
                                         products by approximately nine
                                         percent in 2007.
    -------------------------------------------------------------------------
    Retail banking

    Financial Services began offering retail banking products including high
    interest savings accounts, guaranteed investment certificates and
    residential mortgages in two pilot markets in October 2006. The retail
    banking business leverages the trust and credibility Canadian Tire has
    earned over the last 40 years by providing financial services to millions
    of customers.
    -------------------------------------------------------------------------
    Q2 2007 Performance                  2005-2009 Plan
    -------------------------------------------------------------------------
    Financial Services launched its      The retail banking pilot will run
    retail banking products in two       for approximately 24 months.
    pilot markets in October 2006.       During this time its future
    Financial Services is supporting     potential will be assessed.
    the launch with a multi-faceted
    marketing program including flyer    2007 Outlook
    inserts, direct mail, television     Financial Services plans to
    and radio advertisements,            introduce additional retail
    billboards and in-store advertising  banking products in 2007.
    to increase customer awareness.
    Customers can sign up for Canadian   Financial Services plans to incur
    Tire's retail banking products       approximately $25 million in
    online, by phone or in-store in the  expenses associated with the
    pilot markets.                       marketing and operations of the
                                         retail banking initiative in 2007.
    The investment in retail banking
    pilot programs impacted Financial    Financial Services has now extended
    Services' earnings before income     the pilot to a third test market
    taxes by $5.8 million during the     to expand the trial of new
    quarter compared to $0.9 million     marketing approaches.
    during the same period in 2006.
    -------------------------------------------------------------------------

    4.4.2 Key performance indicators

    The following are key indicators of Financial Services' performance:
    -   size of the total managed portfolio
    -   profitability of the portfolio
    -   quality of the portfolio

    Financial Services' total managed portfolio of loans receivable

    ($ in millions,
     except where
     noted)            Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Average number of
     accounts with a
     balance
     (thousands)         1,855     1,846    0.5%     1,850     1,827    1.2%
    Average account
     balance ($)      $  1,940  $  1,829    6.1%  $  1,924  $  1,830    5.1%
    Gross average
     receivables
     (GAR)             3,599.6   3,376.6    6.6%   3,558.8   3,345.0    6.4%
    Total managed
     portfolio (end
     of period)                                    3,704.3   3,429.3    8.0%
    Net managed
     portfolio (end
     of period)                                    3,671.9   3,393.3    8.2%
    -------------------------------------------------------------------------

    Net managed portfolio

    Financial Services' net managed portfolio is the total value, after
allowances, of loans receivable including credit card, personal and
residential mortgage loans.
    The credit card portfolio represents approximately 95 percent of the total
managed portfolio for Financial Services. The personal loan product continues
to be tested and represents approximately five percent of the total managed
portfolio.

    Financial Services' portfolio of credit card loans receivable

    ($ in millions,
     except where
     noted)            Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Average number of
     accounts with a
     balance
     (thousands)         1,816     1,803    0.8%     1,810     1,786    1.3%
    Average account
     balance ($)      $  1,872  $  1,718    9.0%  $  1,850  $  1,725    7.3%
    Gross average
     receivables
     (GAR)             3,400.4   3,097.5    9.8%   3,349.5   3,080.6    8.7%
    Total managed
     portfolio (end
     of period)                                    3,514.0   3,165.2   11.0%
    -------------------------------------------------------------------------

    Financial Services' total managed portfolio of credit card loans
receivable reached $3.5 billion at the end of the second quarter. The
successful rollout of the Gas Advantage MasterCard in Ontario in the second
quarter of 2006 combined with an increase in average account balances resulted
in an 11.0 percent increase in credit card loans receivable at the end of the
second quarter over the second quarter of 2006.
    In prior periods, Financial Services experienced a period of accelerated
growth during the conversion of its existing proprietary card portfolio to a
MasterCard portfolio. Now that the conversion is complete, Financial Services'
growth will be driven by increases in average account balances, new account
applications and the introduction of new credit card and insurance products.
Management regards new retail banking products as another high-potential
channel for long-term growth.

    Financial Services' profitability

    Financial Services' profitability measures are tracked as a percentage of
GAR, shown in the table below.

    Profitability of total managed portfolio(1)

                                                 Q2 2007   Q2 2006   Q2 2005
    -------------------------------------------------------------------------
    Total revenue as a % of GAR(2)                24.88%    25.10%    26.13%
    Gross margin as a % of GAR(2)                 13.13%    13.17%    13.57%
    Operating expenses as a % of GAR(3)            7.77%     8.10%     8.91%
    Return on average total managed portfolio
     (2),(3),(4)                                   5.36%     5.07%     4.66%
    -------------------------------------------------------------------------
    (1) Figures are calculated on a rolling 12-month basis and comprise the
        total managed portfolio of loans receivable.
    (2) Excludes gains (losses) on sales of loans receivable and gain on
        disposal of shares.
    (3) Excludes the impact of the modification to the stock option
        agreements in the fourth quarter of 2006.
    (4) Return is calculated as earnings before taxes as a percentage of GAR.

    Gross margin

    Gross margin is Financial Services' total revenue less direct expenses
associated with credit card, personal and mortgage loans, insurance and
warranty products. The most significant direct expenses are the provision for
credit losses associated with the credit card and personal loan portfolios,
the loyalty program and interest expense.
    Over the last few years, Financial Services' growth strategy has been the
transformation of the credit card portfolio from a proprietary store credit
card to a bank card (MasterCard). As expected, as the portfolio matures, this
strategy has resulted in lower revenue and gross margin ratios as a percentage
of GAR. These decreases have been more than offset through continued growth in
average balances and a lower operating expense ratio, resulting in an
increasing return on average total managed portfolio, as reflected in the
table above.
    Operating expenses as a percentage of GAR have continued to decline due to
ongoing expense management efforts and growth in the size of the total managed
portfolio. This was achieved even with the ongoing investment in the retail
banking pilot project referenced above.
    As part of the strategic planning process, management set a long-term goal
of managing Financial Services' pre-tax return on the total managed portfolio
in the target range of 4.5 to 5.0 percent. As shown in the table above,
Financial Services exceeded this target in the second quarter of each of the
last two years.

    Portfolio quality

                                                 Q2 2007   Q2 2006   Q2 2005
    -------------------------------------------------------------------------

    Net write-off rate (rolling 12-month basis)    5.89%     5.95%     5.96%
    Account balances less than 30 days overdue
     at end of period                             96.57%    96.39%    96.63%
    Allowance rate                                 2.32%     2.47%     2.40%
    -------------------------------------------------------------------------

    Net write-offs

    Net write-offs is the sum of account balances that are written off, less
monies collected against account balances that were previously written off.
Net write-off rate is the net write-offs, expressed as a percentage of gross
average receivables in a given period.
    The credit card portfolio net write off rate improved from 5.99 percent in
the second quarter of 2006 to 5.62 percent in the second quarter of 2007,
reflecting the benefits of a number of initiatives to improve the overall
quality of the portfolio.
    Periodic fluctuations in write-offs, aging and allowances occur as a
result of a variety of economic influences such as job growth or losses,
personal debt levels and personal bankruptcy rates.

    4.4.3 Financial Services' financial results

    ($ in millions)    Q2 2007   Q2 2006  Change  2007 YTD  2006 YTD  Change
    -------------------------------------------------------------------------
    Gross operating
     revenue          $  197.5  $  179.6    9.9%  $  379.8  $  341.3   11.3%
    EBITDA(1)             76.2      54.0   41.0%     128.4      89.6   43.3%
    Earnings before
     income taxes         68.6      44.5   54.2%     114.0      73.9   54.3%
    -------------------------------------------------------------------------
    Less adjustment for:
      Gain on
       disposal/
       redemption
       of shares          18.4       6.9              18.4       6.9
      Loss on disposals
       of property and
       equipment          (0.1)     (0.2)             (0.2)     (0.3)
      Gain (loss) on
       sales of loans
       receivable          5.5      (3.4)              2.5     (16.1)
    -------------------------------------------------------------------------
    Adjusted earnings
     before income
     taxes(1)         $   44.8  $   41.2    8.6%  $   93.3  $   83.4   11.9%
    -------------------------------------------------------------------------
    (1) See section 11.0 on non-GAAP measures.
    

    Explanation of Financial Services' financial results

    Growth in the Gas Advantage MasterCard portfolio and increases in the
average account balance were the key drivers of gross operating revenue in the
second quarter. Revenues from balance-based insurance products, warranties and
other ancillary products were also higher in the quarter.
    Financial Services' earnings before income taxes were up 54.2 percent
during the quarter due to higher gross operating revenue, combined with a
reduction in the allowance rate due to improved aging and write off experience
as explained above. Although there were investments in future oriented
initiatives, operating expenses as a percentage of GAR improved by 33 basis
points, demonstrating improved operating leverage. Second quarter 2007 results
were also favourably impacted by a gain from the sale of MasterCard
International shares of $18.4 million (compared with a gain of $6.9 million in
the prior year) and a gain from securitization of $5.5 million (compared with
a loss of $3.4 million in the prior year).
    Second quarter results were, however, impacted by a reduction in interest
income resulting from lower cash balances due to the payment of a prior year
income tax reassessment related to dividends received from a reinsurance
investment (see section 6.0 below).

    Securitization of loans receivable

    Securitization is the process by which interests in financial assets are
sold to a third party. Financial Services routinely securitizes credit card
loans receivable by selling a co-ownership interest to Glacier Credit Card
Trust (GCCT). Personal loans are sold to a third party trust for
considerations that include cash and a retained interest in the assets. We
record these transactions as a sale, and as a result, these assets are not
included on our Consolidated Balance Sheets. Financial Services securitizes
between 70 percent and 80 percent of loans receivable on an ongoing basis.

    4.4.4 Business risks

    Financial Services is exposed to a number of risks in the normal course
of its business that have the potential to affect its operating performance.
These include, but are not limited to, consumer credit risk, interest rate
risk and securitization funding risk. These risks and management's mitigation
strategies are explained in more detail in Section 4.2.4.5 of the MD&A
contained in our 2006 Financial Report.
    Please also refer to section 8.0 of this MD&A for a discussion of some
other industry-wide and Company-wide risks affecting the business.
    Most of Financial Services' revenue is not interest rate sensitive as it
is generated primarily from Canadian Tire MasterCards, which carry a fixed
interest rate appropriate to customer segments with common credit ratings.
Canadian Tire constantly monitors the potential impact of interest rate
fluctuations on its fixed versus floating rate exposure and manages its
overall balance to reduce the magnitude of this exposure.
    As the success of Financial Services is partially dependent upon its
ability to access capital markets at favourable rates, and given the rapid
growth of the total managed portfolio, maintaining the quality of the
securitized loans receivable is a key priority of Financial Services.

    5.0 Capital structure and financing

    5.1 Capital structure

    Improving our financial flexibility is one of our long-term goals and one
of the imperatives of our 2005-2009 Strategic Plan.
    We regularly review our funding plan and capital structure to ensure that
we have sufficient funding options to provide us with the financial
flexibility to implement our growth initiatives and meet the targets of our
2005-2009 Strategic Plan.

    As at the dates indicated, our capital structure was as follows:

    
                                        At June 30,   At July 1, At December
    (composition of total structure)          2007         2006     30, 2006
    -------------------------------------------------------------------------
    Shareholders' equity                      68.0%        65.7%        67.2%
    Long-term debt(1)                         27.4%        29.3%        28.3%
    Other long-term liabilities                2.9%         2.8%         2.7%
    Future income taxes                        1.7%         2.2%         1.8%
    -------------------------------------------------------------------------
                                             100.0%       100.0%       100.0%
    -------------------------------------------------------------------------
    (1) Includes the current portion of long-term debt.

    Equity

    The book value of Common Shares and Class A Non-Voting Shares at the end
of the quarter was $35.58 per share compared to $32.25 at the end of the
second quarter of 2006.
    We have a policy of repurchasing Class A Non-Voting Shares to offset the
dilutive effect of shares issued to fulfill the Company's obligations under
various employee profit sharing, stock option and share purchase plans and the
dividend reinvestment plan. In the long term, these repurchases are expected
to offset the issuance of new Class A Non-Voting Shares.
    On February 8, 2007, we announced our intention to initiate a normal
course issuer bid (NCIB) to purchase a maximum of 1.4 million of the issued
and outstanding Class A Non-Voting Shares over the 12-month period ending
February 18, 2008.
    A NCIB is a bid by a listed company to buy back its shares, up to a
prescribed number, on a stock exchange, subject to certain rules that protect
investors. A total of approximately 1.2 million Class A Non-Voting Shares were
purchased in 2006 under the previous NCIB.
    In November 2001, the Company formed a limited partnership for the purpose
of raising $300 million of capital in relation to a portfolio of its retail
properties. The Company was the general partner in this partnership. A third
party investor group invested $300 million for a limited partnership interest
with preferential rights to distribution of income and capital. On April 3,
2006, the limited partnership repaid the limited partners. Accordingly, the
minority interest ceased to be reflected on the Consolidated Balance Sheets
after April 3, 2006, and no further charge has been reflected in the
Consolidated Statements of Earnings since April 3, 2006.

    Shares outstanding
                                                     At June 30,   At July 1,
                                                           2007         2006
    -------------------------------------------------------------------------
    Class A Non-Voting Shares (CTC.a)
      Shares outstanding at beginning of period      78,047,456   78,032,724
      Shares issued under plans(1)                      290,571      678,247
      Shares purchased under NCIB                      (287,000)    (593,400)
    -------------------------------------------------------------------------
      Shares outstanding at end of period            78,051,027   78,117,571
    Common Shares (CTC)
      Shares outstanding at beginning and end
       of the period                                  3,423,366    3,423,366
    -------------------------------------------------------------------------
    (1) We issue shares under various employee profit sharing, stock option
        and share purchase plans, and the dividend reinvestment plan.
    

    Dividends

    Dividends of $15 million were declared on Common Shares and Class A
Non-Voting Shares in the second quarter of 2007 compared to dividends of
$13.5 million in the second quarter of 2006. The increase in dividends
declared reflected the Board of Directors' decision in February 2007 to
increase the annual dividend rate by 12 percent from $0.66 per share to $0.74
per share. The second quarterly dividend at the 2007 rate was declared on
May 10, 2007 in the amount of $0.185 per share payable on September 4, 2007 to
shareholders of record as of July 31, 2007.

    Dividend policy

    Canadian Tire's policy is to maintain dividend payments equal to
approximately 15 to 20 percent of the prior year's normalized basic net
earnings per share, after giving consideration to the period-end cash
position, future cash requirements and investment opportunities. Normalized
earnings per share for this purpose exclude gains and losses on the sale of
credit card receivables and non-recurring items but include gains and losses
on the ordinary course disposition of property and equipment.

    Short-term debt

    We have a program in place that allows us to issue commercial paper to a
maximum authorized limit of $800 million. We had no commercial paper
outstanding at June 30, 2007, July 1, 2006 or December 30, 2006.
    Credit ratings for the Company's commercial paper are R-1(low) from
Dominion Bond Rating Service Limited (DBRS) and A-1(low) from Standard &
Poor's (S&P).
    At June 30, 2007, July 1, 2006 and December 30, 2006 we had $645 million
in committed lines of credit. The committed lines were not drawn upon at the
end of any of these periods.

    Long-term debt

    To allow for timely access to debt markets, we filed a shelf prospectus
with provincial and territorial securities commissions on March 9, 2007 for
the issuance of a maximum of $750 million of MTNs over a 25 month period.
    As of the end of the second quarter of 2007, long-term debt included
$1.5 million of capital leases.
    Like most borrowers, we provide covenants to our lenders. We are in
compliance with all of our debt covenants.
    The Company's long-term debt is currently rated A(low) by DBRS and BBB+
by S&P.

    5.2 Funding program

    5.2.1 Funding requirements

    We fund our capital expenditures, working capital needs, dividend
payments and other financing needs, such as debt repayments and Class A
Non-Voting Share purchases under the NCIB, from a combination of sources. In
the second quarter of 2007, the primary sources of funding were:

    
    -   $202 million of cash flow from operations, before working capital
        requirements
    -   $140 million of cash generated from the securitization of loans
        receivable

    5.2.2 Second quarter 2007 capital program

    Canadian Tire's capital expenditures totaled $139 million in the second
quarter on a cash basis, ($168 million on an accrual basis as disclosed in the
Unaudited Consolidated Financial Statements, Note 10 - Supplementary Cash Flow
Information), an 80 percent increase from the $77 million spent on a cash
basis in the second quarter of 2006 ($84 million on an accrual basis as
disclosed in the Unaudited Consolidated Financial Statements, Note 10 -
Supplementary Cash Flow Information). Those capital expenditures were
comprised of:

    -   $88 million for real estate projects, including $70 million
        associated with the rollout of CTR's Concept 20/20 stores
    -   $30 million for the Eastern Canada distribution centre in the
        province of Quebec
    -   $11 million for information technology
    -   $10 million for other purposes

    Overall, capital investments for real estate projects were up
significantly year-over-year in the second quarter, primarily due to the
acceleration of the Concept 20/20 store rollout, investment in the
construction of the Eastern Canada distribution centre and other capital
required for some larger urban store developments.

    5.2.3 2007 Annual capital plan

    The 2007 capital plan is for expenditures to be in the range of
$580 million to $620 million on an accrual basis. The 2007 annual capital plan
is comprised of the following investments, which total $600 million:

    -   $352 million for real estate projects, including $269 million
        associated with the rollout of CTR's Concept 20/20 stores
    -   $110 million for the Eastern Canada distribution centre
    -   $ 75 million for information technology
    -   $ 63 million for other purposes

    5.2.4 Working capital

    Reducing our working capital requirements continues to be a long-term
priority. The table below shows the change in the value of our working capital
components at the end of the second quarter of 2007 and 2006.

    Comparable working capital components

                                                                    Increase/
                                                                   (decrease)
    ($ in millions)                     At June 30,   At July 1,  in working
                                              2007         2006      capital
    -------------------------------------------------------------------------
    Accounts receivable                  $   363.8    $   382.1    $  ( 18.3)
    Merchandise inventories                  810.7        817.4         (6.7)
    Prepaid expenses and deposits             59.6         58.8          0.8
    Income taxes recoverable/(payable)       103.6        (28.2)       131.8
    Accounts payable and other            (1,155.9)    (1,025.7)      (130.2)
    -------------------------------------------------------------------------
                                                                   $   (22.6)
    -------------------------------------------------------------------------

    The change in the balance of income taxes from being an amount payable to
an amount recoverable is attributable to the statutory requirements for
remittances regarding prior year reassessments, as explained in Section 6.0
below.
    The increase in accounts payable and other is primarily attributable to a
change in the timing of payments compared to the prior year.

    5.2.5 Cash and cash equivalents

    At June 30, 2007, the Company was in a negative cash position of
$17 million in cash and cash equivalents compared to positive cash positions
of $93 million at July 1, 2006 and $741 million at December 30, 2006. These
changes partly reflect seasonal fluctuations in cash balances. During the
second quarter of 2007, we used cash primarily for the following:

    -   $139 million for the addition of property and equipment
    -   $102 million to fund further net growth in loans receivable
    -   $ 22 million related to repayment of commercial paper
    -   $ 85 million related to tax payments related to prior year
        reassessments

    5.2.6 Loans receivable

    Our loans receivable securitization program is designed to provide a
cost-effective source of funding for Financial Services. Loans receivable were
as follows at the indicated dates:

                                        At June 30,   At July 1, At December
    ($ in millions)                           2007         2006     30, 2006
    -------------------------------------------------------------------------
    Securitized                          $ 2,916.4    $ 2,540.3    $ 2,827.4
    Unsecuritized                            755.5        853.0        771.8
    -------------------------------------------------------------------------
    Net managed loans receivable         $ 3,671.9    $ 3,393.3    $ 3,599.2
    -------------------------------------------------------------------------

    Net managed loans receivable continued to increase over the last 12 months
as customers' use of the Canadian Tire MasterCard grew and new personal loans
were granted. At the end of the second quarter of 2007, net managed loans
receivable were 8.2 percent higher than at the end of the second quarter of
2006.
    Canadian Tire Bank (CTB) sells co-ownership interests in credit card loans
to GCCT. The Company does not have a controlling interest in GCCT, so we do
not include the financial results of GCCT in our Consolidated Financial
Statements.
    We record the sale of loans receivable in accordance with CICA's
Accounting Guideline 12 "Transfers of Receivables". Please see Note 2 to the
Consolidated Financial Statements found in the 2006 Financial Report.
    For the 13 weeks ended June 30, 2007, we recognized a pre-tax gain of $5.5
million (2006 - $3.4 million pre-tax loss) on securitization transactions.
    We expect the growth in the number and average balances of Canadian Tire
MasterCard credit card accounts to lead to an increase in total loans
receivable in 2007. Financial Services expects to continue to fund most of
this increase from the sale of co-ownership interests in credit card loans to
GCCT. GCCT is a third party trust that was formed to buy our credit card loans
and also issues debt to third party investors to fund its credit card loans
purchases. See section 7.1 below for further information. The success of the
securitization program is mainly due to GCCT's ability to obtain funds from
third parties by issuing debt instruments with high credit ratings. As of
June 30, 2007 GCCT had the following ratings:

    -   a rating of R-1(high) from DBRS for the asset-backed commercial paper
        program
    -   ratings of AAA from DBRS and S&P for the asset-backed senior notes
    -   ratings of A from DBRS and S&P for the asset-backed subordinated
        notes

    The trustee and custodian for GCCT, The Canada Trust Company, manages the
co-ownership interest and acts as agent for, and on behalf of, Canadian Tire
Bank and GCCT, as the owners of the co-ownership interests. BNY Trust Company
of Canada acts as indenture trustee with respect to GCCT and manages the
security interests of the holders of the senior and subordinated notes issued
by GCCT. We are currently not aware of any events, commitments, trends or
uncertainties that may have a negative impact on our arrangement with GCCT.

    5.3 Financial ratios

    We have ready access to funding from the financial markets because of our
relatively strong balance sheet and healthy financial ratios. We have a
long-standing policy of keeping our ratio of long-term debt to total
capitalization below 50 percent.
    The following table shows the changes in financial ratios over the past
year.

                                                     At June 30,   At July 1,
                                                           2007         2006
    -------------------------------------------------------------------------
    Ratio of long-term debt to total
     capitalization(1)                                    27.4%        29.3%
    Ratio of current assets to current liabilities        1.6:1        2.1:1
    Interest coverage(2)                              9.9 times    7.8 times
    -------------------------------------------------------------------------
    (1) Long-term debt includes current portion.
    (2) We calculate interest coverage on a rolling 12-month basis using
        earnings before interest, income taxes and minority interest.

    5.4 Incentive programs

    On June 30, 2007, the former CEO retired from his position as
Vice-Chairman and, as a result, the Company included a charge of $6.7 million
in the second quarter to reflect the cost of previously unvested share units
he is now entitled to under the Company's share incentive programs (valued at
the prevailing stock price on June 30, 2007) in addition to other retirement
obligations. The ultimate cost to the Company of a significant portion of this
compensation, and the value provided to the former CEO, will be based on the
future performance of the Company over the next three year period, as the
share units will be marked to market until they are fully paid. The mark to
market adjustments will be reflected in the Company's financial results each
quarter until that time.
    In addition, while not considered a non-operating item and accordingly
included in normal operating earnings, the second quarter included the cost
associated with the Company's various long term incentive programs (LTIP) of
$9.8 million (2006 $3.3 million). The largest component of this related to the
expensing of stock options, including the mark to market impact of the fully
vested pre-2004 stock options (net of the benefit of an economic hedge). The
year-over-year increase was driven by the modification to the stock option
programs in the fourth quarter of 2006 combined with the appreciation in the
value of the Company's stock price over the prior year comparative period and
the issuance of stock options with tandem stock option appreciation rights
under the 2006 and 2007 stock option programs. The cost of the 2006 stock
option program was substantially offset by the benefits of an economic hedge.
    For a full description of stock based compensation plans, please refer to
Note 10 to the Consolidated Financial Statements contained in our 2006
Financial Report.

    5.5 Foreign operations

    Since the late 1970s, the Company has established operations outside
Canada for a variety of business purposes. This has resulted in a portion of
the Company's capital and accumulated earnings being in wholly owned foreign
subsidiaries. As there are currently no plans to repatriate the capital and
earnings, Canadian and foreign taxes that might arise upon such repatriation
have not been provided for. These funds have been accumulated in the following
international operations:

    a)  U.S. based subsidiaries hold highly rated short-term securities and
        loans to the Company and its wholly owned Canadian subsidiaries. The
        capital and earnings of these U.S. based subsidiaries arose from
        investments made to offset net operating losses incurred by U.S.
        retail operations closed in the 1980s and 1990s and from the
        reinsurance of risks relating to certain insurance products marketed
        to customers of Financial Services and other reinsurance activities.
    b)  subsidiaries operating in the Pacific rim have provided the Company
        with a variety of important services related to product sourcing,
        logistics and vendor management. These subsidiaries have earned
        commissions for such services for over 20 years.
    c)  a Bermuda-based reinsurance company was established in 2004 to
        reinsure the risk of certain insurance products marketed to customers
        of Financial Services. In addition to its reinsurance activities,
        this company invests in highly rated short-term securities and makes
        loans to the Company.
    

    6.0 Tax matters

    In the ordinary course of business, the Company is subject to ongoing
audits by tax authorities. While the Company believes that its tax filing
positions are appropriate and supportable, from time to time certain matters
are reviewed and challenged by the tax authorities.
    The Canada Revenue Agency (CRA) has reassessed and is also expected to
issue further reassessments regarding the tax treatments of commissions paid
to foreign subsidiaries of the Company (covering periods from 1995 onwards),
and dividends received on an investment made by a wholly-owned subsidiary of
the Company related to reinsurance (covering periods from 1999 to 2003). The
applicable provincial tax authorities were expected to (and, as noted below,
subsequently did) reassess for the corresponding periods. The Company does not
have a significant exposure on these matters subsequent to the 2003 taxation
year. The reassessments and expected reassessments in these matters are based
on multiple grounds, some of which are highly unusual, and the Company will
appeal these reassessments as and when they are received.
    If the CRA (and applicable provincial tax authorities) were entirely
successful in their reassessments - an outcome that the Company and its tax
advisors believe to be very unlikely - it is estimated that the total
liability of the Company for additional taxes, interest and penalties could be
approximately $263 million. Although the Company will appeal these
reassessments, current tax legislation requires the Company to remit to the
CRA and its provincial counterparts approximately $163 million, of which
$157 million had been remitted by the end of the quarter.
    The Company regularly reviews the potential for adverse outcomes in
respect of tax matters. The Company believes that the ultimate disposition of
these reassessments will not have a material adverse effect on its liquidity,
consolidated financial position or results of operations because the Company
believes that it has adequate provision for these tax matters. Should the
ultimate tax liability materially differ from the provisions, the Company's
effective tax rate and its earnings could be affected positively or negatively
in the period in which the matters are resolved.

    7.0 Off-balance sheet arrangements

    7.1 Glacier Credit Card Trust

    As noted earlier, GCCT was formed to buy our credit card loans and issues
debt to third party investors to fund its credit card loans purchases. Please
refer to sections 4.4.3 and 5.2.6 of this MD&A for additional information on
GCCT.

    7.2 Personal loan securitization

    As previously discussed in section 5.2.6 of this MD&A, we sold a portion
of our personal loan receivables to a third party trust. Please refer to MD&A
section 8.2 of our 2006 Financial Report for additional information.

    7.3 Trust financing for Associate Dealers

    A financing program has been established to provide an efficient and
cost-effective way for Associate Dealers to access the majority of the
financing they require for their store operations. Please refer to MD&A
section 8.3 of our 2006 Financial Report for additional information on this
program.

    7.4 Bank financing for Associate Dealers and PartSource franchisees

    We have guaranteed the bank debt of some Associate Dealers and some
PartSource franchisees. Please refer to MD&A section 8.4 of our 2006 Financial
Report for additional information on these guarantees.

    7.5 Derivative financial instruments

    We use derivative financial instruments to manage our exposure to changes
in interest rates and foreign currency exchange rates. We also use equity
derivative contracts to hedge certain future stock-based compensation
expenses. We do not use hedging to speculate, but rather as a risk management
tool. Please refer to MD&A section 8.5 in our 2006 Financial Report for
additional information on derivative financial instruments.

    8.0 Enterprise risk management

    To preserve and enhance shareholder value, the Company approaches the
management of risk strategically through its Enterprise Risk Management (ERM)
framework. Introduced in 2003, the ERM framework sets out principles and tools
for identifying, evaluating, prioritizing and managing risk effectively and
consistently across the Company.
    The ERM framework and the identification of principal risks that the
Company manages on an ongoing basis is described in detail in section 9.0 of
the MD&A in our 2006 Financial Report.
    Management reviews risks on an ongoing basis and did not identify any new
principal risks during the second quarter of 2007

    9.0 Contractual obligations

    
    Contractual obligations due by period

                                        In the
                                     remaining
                                           six  In years  In years
                                        months      2008      2010     After
    ($ in millions)            Total   of 2007    - 2009    - 2011      2011
    -------------------------------------------------------------------------
    Long-term debt(1)       $1,170.2  $    1.0  $  153.7  $  164.9  $  850.6
    Capital lease
     obligations                 1.5       0.5       1.0         -         -
    Operating leases         1,874.8      95.0     374.7     318.9   1,086.2
    Purchase obligations       972.6     822.2     133.4      11.7       5.3
    Other obligations           23.5       5.8       8.8       3.0       5.9
    -------------------------------------------------------------------------
    Total contractual
     obligations            $4,042.6  $  924.5  $  671.6  $  498.5  $1,948.0
    -------------------------------------------------------------------------
    (1) The long-term debt number in the Consolidated Balance Sheet has been
        adjusted by $5.3 million due to the implementation of the new
        Financial Instrument standard.
    

    10.0 Changes in accounting policies

    10.1 Consolidation of variable interest entities

    In June 2003, the CICA issued Accounting Guideline 15, "Consolidation of
Variable Interest Entities" (AcG-15). This guideline was amended in September
2004 to harmonize with the related U.S. accounting standard, which had been
revised in December 2003. AcG-15 requires companies to include certain
variable interest entities in their annual or interim consolidated financial
statements beginning on or after November 1, 2004.
    In the fourth quarter of 2004, we made structural changes to the
arrangements involving the independent trusts described in sections 8.1, 8.2
and 8.3 of the MD&A contained in our 2006 Financial Report. Consequently, we
were not required to include the financial results of the trusts in our
Consolidated Financial Statements for the period ended June 30, 2007.
    A number of the corporations owned and operated by independent Associate
Dealers and by Mark's and PartSource franchisees are variable interest
entities. Although a few of these corporations required some subordinated
financial support from us during the year, none of these corporations have
been included in our Consolidated Financial Statements as the impact of
consolidating these corporations was not material.

    10.2 Financial instruments, comprehensive income, hedging and equity

    As part of Canada's move toward harmonization with International
Accounting Standards (currently expected to be completed by 2011), the CICA
issued five new accounting standards that applied to the Company as of the
first day of our 2007 fiscal year. These were: a) CICA Handbook Section 3855 -
Financial Instruments, Recognition and Measurement b) CICA Handbook Section
3861 - Financial Instruments - Disclosure and Presentation c) CICA Handbook
Section 3865 - Hedges d) CICA Handbook Section 3251 - Equity and e) CICA
Handbook Section 1530 - Comprehensive Income.

    Financial instruments

    The standards related to financial instruments required us to classify
financial assets and liabilities according to their characteristics and
management's choices and intentions related thereto for the purposes of
ongoing measurement. Classification choices for financial assets include: a)
Held for Trading; b) Held to Maturity; c) Available for Sale and d) Loans and
Receivables. Classification choices for financial liabilities include: a) Held
for Trading and b) Other. Subsequent measurement for these assets and
liabilities are based on either fair value or amortized cost using the
effective interest method, depending upon their classification.

    Comprehensive income

    Under the new comprehensive income standard, we are required to report in
a new financial statement entitled "Statement of Comprehensive Income" changes
in the fair value of certain of these financial assets and liabilities (e.g.
the effective portion of changes in the fair value of a derivative designated
in a cash flow hedging relationship). The "Accumulated Other Comprehensive
Income" (i.e. the portion of comprehensive income not already included in net
earnings) is being presented as a separate line in shareholders' equity.

    Hedging

    With respect to the new standard related to hedging, the Company enters
into various cash flow hedges, including foreign currency contracts and equity
derivatives (used to hedge employee stock-based compensation plans). In cash
flow hedges, the effective portion of the change in fair value of the hedging
item is recorded in other comprehensive income. To the extent the change in
fair value of the derivative is not completely offset by the change in the
fair value of the hedged item, the ineffective portion of the hedging
relationship is recorded immediately in net earnings. The Company also enters
into various fair value hedges, including interest rate swaps. In fair value
hedges the change in fair value of both the hedged item attributable to the
risk being hedged and the entire hedging item are recorded in the net earnings
on a quarterly basis.
    The maximum length of time over which the Company is hedging its exposure
to future cash flow variability for anticipated transactions is 10 years.

    Equity

    This new CICA Handbook section describes standards for the presentation
of equity and changes in equity in the period, with specific reference to the
new Comprehensive Income standard.
    For a detailed description of the new accounting standards and their
impact on the opening balances of Retained Earnings, Accumulated Comprehensive
Income and other Balance Sheet Components please see Note 2 to the
Consolidated Financial Statements for the period ended June 30, 2007.
    The impact of adopting the new standards on the 2007 second quarter net
earnings was not significant.
    While the new standards have resulted in changes to our financial
results, revised accounting procedures and additional disclosures, they are
not expected to have a material impact on the Company's cash flows, business
strategy or risk management processes in the foreseeable future.

    11.0 Non-GAAP measures

    The following measures included in this MD&A do not have a standardized
meaning under Canadian generally accepted accounting principles (GAAP):

    
    -  EBITDA (earnings before interest, income taxes, depreciation and
       amortization) and minority interest
    -  adjusted earnings, adjusted EPS basic, adjusted EPS net, EBITDA -
       adjusted
    -  same store sales
    -  comparable sales for Petroleum sites

    For further information on our non-GAAP measures, please refer to
Management's Discussion and Analysis in the MD&A contained in our 2006
Financial Report.

    EBITDA and minority interest

    With the exception of Financial Services, we consider EBITDA and minority
interest to be an effective measure of the contribution of each of our
businesses to our profitability on an operational basis, before allocating the
cost of income taxes and capital investments. EBITDA and minority interest is
also commonly regarded as an indirect measure of operating cash flow, a
significant indicator of success for many businesses.

    A reconciliation of EBITDA and minority interest to the most comparable
GAAP measure (earnings before income taxes and minority interest) is provided
as follows:

    ($ in millions)                    Q2 2007   Q2 2006  YTD 2007  YTD 2006
    -------------------------------------------------------------------------
    EBITDA and minority interest
      CTR                             $  150.5  $  161.4  $  249.5  $  258.9
      Financial Services                  76.2      54.0     128.4      89.6
      Petroleum                           10.5       2.5      17.0       7.8
      Mark's                              29.7      25.0      45.7      37.8
      Eliminations                       (12.1)    (13.1)    (22.2)    (20.6)
                                  -------------------------------------------
      Total EBITDA and minority
       interest                       $  254.8  $  229.8  $  418.4  $  373.5
                                  -------------------------------------------
    Less: Depreciation and
     amortization expense
        CTR                           $   38.6  $   36.6  $   75.4  $   72.5
        Financial Services                 3.0       3.1       6.3       6.3
        Petroleum                          4.1       3.7       8.1       7.3
        Mark's                             4.5       3.8       8.8       7.7
                                  -------------------------------------------
        Total depreciation and
         amortization expense         $   50.2  $   47.2  $   98.6  $   93.8
                                  -------------------------------------------
      Interest expense
        CTR                           $   23.2  $   26.9  $   45.4  $   50.0
        Financial Services                 4.6       6.4       8.1       9.4
        Mark's                             0.7       0.9       1.1       1.4
        Eliminations                     (12.1)    (13.1)    (22.2)    (20.6)
                                  -------------------------------------------
        Total interest expense        $   16.4  $   21.1  $   32.4  $   40.2
    -------------------------------------------------------------------------
    Earnings before income taxes
     and minority interest
      CTR                             $   88.7  $   97.9  $  128.7  $  136.4
      Financial Services                  68.6      44.5     114.0      73.9
      Petroleum                            6.4      (1.2)      8.9       0.5
      Mark's                              24.5      20.3      35.8      28.7
                                  -------------------------------------------
    Total earnings before income
     taxes and minority interest      $  188.2  $  161.5  $  287.4  $  239.5
    -------------------------------------------------------------------------
    (1) Differences may occur due to rounding.
    

    References to adjusted earnings

    In several places in this MD&A, we refer to adjusted pre-tax and
after-tax earnings before the impact of certain items. Historically,
non-operating items have included gains and losses on the sales of loans
receivable and dispositions of surplus property and equipment. Occasionally,
other items such as the retirement obligations of our former CEO are also
included. The timing and amount of gains and losses from these items are not
consistent from quarter to quarter. We believe the adjusted figures allow for
a clearer assessment of earnings for each of our businesses, and provide a
more meaningful measure of our consolidated and segmented operating results.

    12.0 Controls and procedures

    Disclosure controls and procedures

    Management is responsible for establishing and maintaining a system of
controls and procedures over the public disclosure of financial and
non-financial information regarding the Company. Such controls and procedures
are designed to provide reasonable assurance that all relevant information is
gathered and reported, on a timely basis, to senior management, including the
Chief Executive Officer (CEO) and the Chief Financial Officer (CFO), so that
appropriate decisions can be made by them regarding public disclosure.
    Our system of disclosure controls and procedures includes, but is not
limited to, our Disclosure Policy, our Code of Business Conduct, the effective
functioning of our Disclosure Committee, procedures in place to systematically
identify matters warranting consideration of disclosure by the Disclosure
Committee, verification processes for individual financial and non-financial
metrics and information contained in annual and interim filings, including the
consolidated financial statements, MD&As, Annual Information Forms and other
documents and external communications.
    As required by CSA Multilateral Instrument 52-109, Certification of
Disclosure in Issuers' Annual and Interim Filings, an evaluation of the
effectiveness of the design of our disclosure controls and procedures was
conducted, under the supervision of management, including the CEO and CFO, as
of June 30, 2007. The evaluation included documentation review, enquiries and
other procedures considered by management to be appropriate in the
circumstances. Based on that evaluation, the CEO and the CFO have concluded
that the design of the system of disclosure controls and procedures remained
effective as of June 30, 2007.

    Internal control over financial reporting

    Management is also responsible for establishing and maintaining
appropriate internal controls over financial reporting. Our internal controls
over financial reporting include, but are not limited to, detailed policies
and procedures related to financial accounting and reporting and controls over
systems that process and summarize transactions. Our procedures for financial
reporting also include the active involvement of qualified financial
professionals, senior management and our Audit Committee.
    All internal control systems, no matter how well designed, have inherent
limitations. Therefore, even those systems determined to be effective can
provide only reasonable assurance with respect to financial statement
preparation and presentation.
    As required by CSA Multilateral Instrument 52-109, Certification of
Disclosure in Issuers' Annual and Interim Filings, an evaluation of the design
of our internal controls over financial reporting was conducted, under the
supervision of management, including the CEO and CFO, as of June 30, 2007.
Based on that evaluation, the CEO and the CFO have concluded that the design
of internal controls over financial reporting continued to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with GAAP as of
June 30, 2007.
    Management has evaluated whether there were changes in our internal
controls over financial reporting during the interim period ended June 30,
2007 that have materially affected, or are reasonably likely to materially
affect, our internal controls over financial reporting. Management has
determined that no material changes occurred in the second quarter of 2007.

    Commitment to disclosure and investor communication

    Canadian Tire strives to maintain a high standard of disclosure and
investor communication. Reflecting our commitment to full and transparent
disclosure, the Investor Relations section of the Company's web site includes
the following documents and information of interest to investors:

    
    -  Annual Information Form
    -  Management Information Circular
    -  Quarterly reports
    -  Quarterly fact sheets
    -  Conference call webcasts (archived for one year)
    

    The Company's Annual Information Form, Management Information Circular
and quarterly reports are also available on the SEDAR (System for Electronic
Disclosure and Retrieval) web site at www.sedar.com.
    If you would like to contact the Investor Relations department directly,
call Karen Meagher (416) 480-8058 or email investor.relations@cantire.com.


    

                             2007 SECOND QUARTER
                          INTERIM REPORT FINANCIALS

    Consolidated Statements of Earnings (Unaudited)
    -------------------------------------------------------------------------

                                 13 weeks ended,          26 weeks ended,
    (Dollars in millions
     except per               June 30,     July 1,      June 30,      July 1,
     share amounts)            2007         2006         2007          2006
    -------------------------------------------------------------------------
    Gross operating
     revenue              $   2,316.7  $   2,247.6  $   4,060.1  $   3,819.7
    -------------------------------------------------------------------------

    Operating expenses
      Cost of merchandise
       sold and all other
       operating expenses
       except for the
       undernoted items       2,052.7      2,008.5      3,626.7      3,433.0
      Interest
        Long-term debt           14.3         19.5         30.0         38.2
        Short-term debt           2.1          1.6          2.4          2.0
      Depreciation and
       amortization              50.2         47.2         98.6         93.8
      Employee Profit
       Sharing Plan               9.2          9.3         15.0         13.2
    -------------------------------------------------------------------------
    Total operating
     expenses                 2,128.5      2,086.1      3,772.7      3,580.2
    -------------------------------------------------------------------------
    Earnings before income
     taxes and minority
     interest                   188.2        161.5        287.4        239.5

    Income taxes                 65.9         58.1        100.6         86.2
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Net earnings before
     minority interest          122.3        103.4        186.8        153.3
    -------------------------------------------------------------------------

    Minority interest
     (Note 7)                       -          0.1            -          2.4
    -------------------------------------------------------------------------

    Net earnings          $     122.3  $     103.3  $     186.8  $     150.9
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic earnings per
     share                $      1.50  $      1.27  $      2.29  $      1.85
    Diluted earnings per
     share (Note 5)       $      1.50  $      1.25  $      2.29  $      1.83
    -------------------------------------------------------------------------
    Weighted average
     number of Common and
     Class A Non-Voting
     Shares outstanding
     (Note 5)              81,485,464   81,588,883   81,494,477   81,536,377
    -------------------------------------------------------------------------



    Consolidated Statements of Cash Flows (Unaudited)
    -------------------------------------------------------------------------

                                 13 weeks ended,          26 weeks ended,
                              June 30,     July 1,      June 30,      July 1,
    (Dollars in millions)      2007         2006         2007          2006
    -------------------------------------------------------------------------

    Cash generated from
     (used for):

    Operating activities
      Net earnings        $     122.3  $     103.3  $     186.8  $     150.9
      Items not affecting
       cash
        Net provision for
         loans receivable        51.6         51.5        101.9        100.9
        Depreciation and
         amortization of
         property and
         equipment               49.7         46.6         97.4         92.5
        Employee future
         benefits expense
         (Note 4)                 1.6          1.8          3.3          3.6
        Fair market value
         adjustment and
         impairments on
         property and
         equipment                2.4            -          2.4            -
        Other                     2.3         (1.3)         1.8         (2.4)
        Amortization of
         other assets             0.5          1.9          1.3          3.2
        Loss (gain) on
         sales of loans
         receivable
         (Note 3)                (5.5)         3.4         (2.5)        16.1
        Gain on disposals
         of property and
         equipment               (4.7)        (0.9)        (4.1)        (4.0)
        Gain on disposals/
         redemptions of
         shares                 (18.4)        (6.9)       (18.4)        (6.9)
    -------------------------------------------------------------------------
                                201.8        199.4        369.9        353.9
    -------------------------------------------------------------------------
    Changes in other
     working capital
     components                  98.3        269.9       (793.9)      (424.1)
    -------------------------------------------------------------------------
    Cash generated from
     (used for) operating
     activities                 300.1        469.3       (424.0)       (70.2)
    -------------------------------------------------------------------------

    Investing activities
        Additions to
         property and
         equipment             (138.5)       (77.0)      (264.1)      (160.6)
        Investment in
         loans receivable      (282.7)      (185.7)      (179.5)      (135.8)
        Purchases of stores      (1.0)        (2.4)        (4.2)        (3.3)
        Employee future
         benefits                (0.5)        (0.5)        (0.9)        (0.9)
        Asset retirement
         obligations             (0.6)         0.9         (0.8)         0.7
        Proceeds on
         disposition of
         property and
         equipment                7.9          6.2          8.5        243.5
        Long-term
         receivables and
         other assets            (1.3)         2.6         16.3         (2.7)
        Proceeds on
         disposals/
         redemptions of
         shares                  18.4          6.9         18.4          6.9
        Securitization of
         loans receivable       139.9        (68.2)       103.6        (90.0)
    -------------------------------------------------------------------------
    Cash used for
     investing activities      (258.4)      (317.2)      (302.7)      (142.2)
    -------------------------------------------------------------------------

    Financing activities
        Dividends               (15.0)       (13.5)       (28.5)       (25.3)
        Repayment of
         long-term debt          (0.6)        (1.2)        (1.4)      (202.7)
        Class A Non-Voting
         Share transactions      (1.6)        (0.9)        (1.6)        (5.6)
        Commercial paper        (21.5)           -            -            -
        Issuance of
         long-term debt             -          0.9            -          0.9
        Repayment of
         limited
         partnership
         interest (Note 7)          -       (300.0)           -       (300.0)
    -------------------------------------------------------------------------
    Cash used for financing
     activities                 (38.7)      (314.7)       (31.5)      (532.7)
    -------------------------------------------------------------------------

    Cash generated (used)
     in the period                3.0       (162.6)      (758.2)      (745.1)
    Cash and cash
     equivalents, beginning
     of period                  (19.9)       255.5        741.3        838.0
    -------------------------------------------------------------------------
    Cash and cash
     equivalents, end of
     period (Note 9)      $     (16.9) $      92.9  $     (16.9) $      92.9
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Consolidated Statements of Comprehensive Income (Unaudited)
    -------------------------------------------------------------------------
                                                       13 weeks     26 weeks
                                                          ended,       ended,
                                                        June 30,     June 30,
    (Dollars in millions)                                  2007         2007
    -------------------------------------------------------------------------

    Net earnings                                    $     122.3        186.8
    Other comprehensive income (loss), net of
     taxes
      Losses on derivatives designated as cash
       flow hedges (net of tax of $21.2 and $23.0)        (38.9)       (42.3)
      Reclassification to non-financial asset of
       (gain) loss on derivatives designated as
       cash flow hedges (net of tax of $0.8 and
       $4.0)                                                1.5         (7.5)
      Reclassification to earnings of gains on
       derivatives designated as cash flow hedges
       (net of tax of $0.9 and $1.6)                       (1.6)        (3.0)
    -------------------------------------------------------------------------
    Other comprehensive income (loss)                     (39.0)       (52.8)
    -------------------------------------------------------------------------
    Comprehensive income                            $      83.3        134.0
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Statements of Changes in Shareholders' Equity (Unaudited)
    -------------------------------------------------------------------------
                                                            26 weeks ended,
                                                        June 30,      July 1,
    (Dollars in millions)                                  2007         2006
    -------------------------------------------------------------------------

    Share capital
    Balance, beginning of period                    $     702.7  $     702.7
    Transactions, net                                      (1.5)         6.6
    -------------------------------------------------------------------------
    Balance, end of period                          $     701.2  $     709.3
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Contributed surplus
    Balance, beginning of period                    $       0.1  $       1.5
    Transactions, net                                       1.2         (0.1)
    -------------------------------------------------------------------------
    Balance, end of period                          $       1.3  $       1.4
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Foreign currency translation adjustment
    Balance, beginning of period as previously
     reported                                       $      (5.7) $      (5.7)
    Reclassification to accumulated other
     comprehensive income                                   5.7          5.7
    -------------------------------------------------------------------------
    Balance, beginning of period as restated
     and end of period                              $         -  $         -
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Retained earnings
    Balance, beginning of period as previously
     reported                                       $   2,088.1  $   1,812.6
    Transitional adjustment on adoption of
     new accounting policies (Note 2)                      (4.4)           -
    -------------------------------------------------------------------------
    Balance, beginning of period as restated            2,083.7      1,812.6
    Net earnings for the period                           186.8        150.9
    Dividends                                             (30.2)       (26.9)
    Repurchase of Class A Non-Voting Shares                   -        (12.2)
    -------------------------------------------------------------------------
    Balance, end of period                          $   2,240.3  $   1,924.4
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Accumulated other comprehensive income (loss)
    Balance, beginning of period as previously
     reported                                       $         -  $         -
    Reclassification from foreign currency
     translation adjustment                                (5.7)        (5.7)
    -------------------------------------------------------------------------
    Balance, beginning of period as restated               (5.7)        (5.7)
    Transitional adjustment on adoption of new
     accounting policies (Note 2)                          14.3            -
    Other comprehensive income (loss) for the
     period                                               (52.8)           -
    -------------------------------------------------------------------------
    Balance, end of period                          $     (44.2) $      (5.7)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Consolidated Balance Sheets (Unaudited)
    -------------------------------------------------------------------------

    (Dollars in millions)                  June 30,      July 1, December 30,
    As at                                     2007         2006         2006
    -------------------------------------------------------------------------

    ASSETS
    Current assets
      Cash and cash equivalents
       (Note 9)                        $         -  $      92.9  $     741.3
      Accounts receivable                    363.8        382.1        340.5
      Loans receivable (Note 3)              683.3        781.7        694.2
      Merchandise inventories                810.7        817.4        667.3
      Income taxes recoverable               103.6            -            -
      Prepaid expenses and deposits           59.6         58.8         46.2
      Future income taxes                     41.8         43.6         51.5
    -------------------------------------------------------------------------
      Total current assets                 2,062.8      2,176.5      2,541.0
    -------------------------------------------------------------------------
    Long-term receivables and other
     assets (Note 3)                         258.7        185.0        283.5
    Goodwill                                  49.8         46.2         46.4
    Intangible assets                         52.4         52.4         52.4
    Property and equipment                 3,009.9      2,596.6      2,881.3
    -------------------------------------------------------------------------
      Total assets                     $   5,433.6  $   5,056.7  $   5,804.6
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES
    Current liabilities
      Bank indebtedness (Note 9)       $      16.9  $         -  $         -
      Accounts payable and other           1,155.9      1,025.7      1,579.5
      Income taxes payable                       -         28.2         81.1
      Current portion of long-term
       debt                                  153.2          3.7          3.0
    -------------------------------------------------------------------------
      Total current liabilities            1,326.0      1,057.6      1,663.6
    -------------------------------------------------------------------------
    Long-term debt                         1,013.2      1,170.1      1,168.4
    Future income taxes                       70.6         89.0         75.0
    Other long-term liabilities              125.2        110.6        112.4
    -------------------------------------------------------------------------
      Total liabilities                    2,535.0      2,427.3      3,019.4
    -------------------------------------------------------------------------
    SHAREHOLDERS' EQUITY
    Share capital (Note 6)                   701.2        709.3        702.7
    Contributed surplus                        1.3          1.4          0.1
    Accumulated other comprehensive loss     (44.2)        (5.7)        (5.7)
    Retained earnings                      2,240.3      1,924.4      2,088.1
    -------------------------------------------------------------------------
      Total shareholders' equity           2,898.6      2,629.4      2,785.2
    -------------------------------------------------------------------------
      Total liabilities and
       shareholders' equity            $   5,433.6  $   5,056.7  $   5,804.6
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Notes to the Consolidated Financial Statements (Unaudited)

    1.  Basis of presentation

        These unaudited interim consolidated financial statements (the
        "financial statements") have been prepared by management in
        accordance with Canadian generally accepted accounting principles
        ("GAAP") and include the accounts of Canadian Tire Corporation,
        Limited and its subsidiaries and partnership (up until April 3, 2006 -
        see Note 7), collectively referred to as the "Company". These
        financial statements do not contain all disclosures required by
        Canadian GAAP for annual financial statements, and accordingly, the
        financial statements should be read in conjunction with the most
        recently prepared annual financial statements for the 52 weeks ended
        December 30, 2006 contained in our 2006 Financial Report.

        The preparation of the financial statements in conformity with GAAP
        requires management to make estimates and assumptions that affect the
        reported amounts of assets and liabilities and disclosures of
        contingent assets and liabilities at the date of the financial
        statements and the reported amounts of revenue and expenses during
        the reporting period. Actual results could differ from these
        estimates. Estimates are used when accounting for items such as
        income taxes, impairment of assets, employee benefits, product
        warranties, inventory provisions, amortization, uncollectible credit
        card receivables and personal loans, environmental reserves, asset
        retirement obligations, financial instruments, and the liability for
        the Company's loyalty programs.

    2.  Accounting policies

        These financial statements follow the same accounting policies and
        methods of their application as the most recently prepared annual
        financial statements for the 52 weeks ended December 30, 2006, except
        as noted below.

        Financial Instruments/Comprehensive Income/Hedges
        -------------------------------------------------

        The Canadian Institute of Chartered Accountants (CICA) issued the
        following new accounting standards that apply to the Company as of
        the first day of the Company's 2007 fiscal year: a) CICA Handbook
        Section 3855 "Financial Instruments, Recognition and Measurement"; b)
        CICA Handbook Section 3861 "Financial Instruments - Disclosure and
        Presentation"; c) CICA Handbook Section 3865 "Hedges"; d) CICA
        Handbook Section 1530 "Comprehensive Income"; and e) CICA Handbook
        Section 3251 "Equity".

        Financial instruments

        This new standard requires the Company to revalue certain of its
        financial assets and liabilities, including derivatives designated in
        qualifying hedging relationships and embedded derivatives in certain
        contracts, at fair value on the initial date of implementation and at
        each subsequent financial reporting date.

        This standard also requires the Company to classify financial assets
        and liabilities according to their characteristics and management's
        choices and intentions related thereto for the purposes of ongoing
        measurement. Classification choices for financial assets include: a)
        held for trading - measured at fair value with changes in fair value
        recorded in net earnings; b) held to maturity - recorded at amortized
        cost with gains and losses recognized in net earnings in the period
        that the asset is derecognized or impaired; c) available for sale -
        measured at fair value with changes in fair value recognized in other
        comprehensive income for the current period until realized through
        disposal or impairment; and d) loans and receivables - recorded at
        amortized cost with gains and losses recognized in net earnings in
        the period that the asset is derecognized or impaired. Classification
        choices for financial liabilities include: a) held for trading -
        measured at fair value with changes in fair value recorded in net
        earnings and b) other - measured at amortized cost with gains and
        losses recognized in net earnings in the period that the liability is
        derecognized. Subsequent measurement for these assets and liabilities
        are based on either fair value or amortized cost using the effective
        interest method, depending upon their classification. Any financial
        asset or liability can be classified as held for trading as long as
        its fair value is reliably determinable.

        In accordance with the new standard, the Company's financial assets
        and liabilities are generally classified and measured as follows:

        Asset/Liability               Category                 Measurement
        ---------------               --------                 -----------
        Cash and cash equivalents     Held for trading         Fair value
        Accounts receivable           Loans and receivables    Amortized cost
        Loans receivable              Loans and receivables    Amortized cost
        Long-term receivables and     Loans and receivables    Amortized cost
         other assets
        Bank indebtedness             Held for trading         Fair value
        Commercial paper              Other liabilities        Amortized cost
        Accounts payable and other    Other liabilities        Amortized cost
        Long-term debt                Other liabilities        Amortized cost
        Other long-term liabilities   Other liabilities        Amortized cost

        Included in the above financial statement captions are the following:

           -  interest-only strip related to the sale of loans receivable,
              which is included in long-term receivables and other assets,
              has been classified as held for trading and measured at fair
              value; and
           -  an equity investment included in long-term receivables and
              other assets, has been classified as available for sale and
              measured at cost (nominal value) because this equity investment
              does not have a quoted price in an active market.

        Other balance sheet accounts, such as merchandise inventories,
        prepaid expenses, current and future income taxes, goodwill,
        intangible assets and property and equipment are not within the scope
        of the new accounting standards as they are not financial
        instruments.

        Transaction costs related to all financial instruments are now
        expensed as incurred. Upon transition to the new standards on
        December 31, 2006, the Company elected to charge the remaining
        unamortized transaction costs related to debt financing in the amount
        of $2.9 million (net of tax) to retained earnings.

        Credit card balance transfer promotions offered by the Company at
        rates not equal to market value are now measured at fair value at
        date of acquisition and then subsequently accounted for at amortized
        cost using the effective interest method. The difference between the
        promotional rates offered and market rates are recorded as an expense
        under the new standards. This resulted in a $3.7 million decrease in
        loans receivable and $2.4 million decrease (net of tax) to opening
        retained earnings on transition.

        Embedded derivatives (elements of contracts whose cash flows move
        independently from the host contract) are required to be separated
        and measured at fair values if certain criteria are met. Under an
        election permitted by the new standard, management reviewed contracts
        entered into or modified subsequent to December 28, 2002 and
        determined that the Company does not currently have any significant
        embedded derivatives in these contracts that require separate
        accounting and disclosure.

        Comprehensive income

        In accordance with the new comprehensive income standard, the Company
        has chosen to report a new financial statement entitled "Consolidated
        Statements of Comprehensive Income" for changes in the fair value of
        certain of these financial assets and liabilities (e.g. the effective
        portion of changes in the fair value of a derivative designated in a
        cash flow hedging relationship). The "accumulated other comprehensive
        income" (i.e. the portion of comprehensive income not already
        included in net earnings) is being presented as a separate line in
        shareholders' equity.

        In accordance with the new standards, management has estimated the
        net amount of gains and losses reported in accumulated other
        comprehensive income, which are currently expected to be reclassified
        to net earnings within the next 12 months, as a loss of approximately
        $34.6 million (net of tax).

        Hedges

        With respect to the new standard related to hedging, the Company
        enters into various cash flow hedges. The Company enters into foreign
        exchange contracts to hedge the exposure to foreign currency risk on
        the future payment of foreign currency denominated inventory
        purchases. The fair value of these contracts is included in accounts
        receivable. The changes in fair value of these contracts are included
        in other comprehensive income to the extent the hedges continue to be
        effective. Once the inventory has been recognized, the Company has
        elected to reclassify the related accumulated other comprehensive
        income amount to merchandise inventories. Subsequent changes in the
        fair value of the foreign exchange contracts are recorded in net
        earnings for the period. The Company enters into equity derivative
        contracts to hedge certain future stock-based compensation expenses.
        The fair value of these contracts is included in accounts receivable
        and long-term receivables and other assets depending on the
        derivative's maturity. The changes in fair value of these contracts
        is included in other comprehensive income to the extent the hedges
        continue to be effective. The related other comprehensive income
        amounts are reclassified to net earnings based on vesting of the
        respective stock-based share units. The Company also enters into
        certain interest rate swap contracts to manage its exposure to
        interest rate risks. The fair value of these contracts is included in
        other long-term liabilities. The changes in fair value of these
        contracts is included in other comprehensive income to the extent the
        hedges continue to be effective. The related other comprehensive
        income amounts are allocated to net earnings in the same period in
        which the hedged item affects net earnings. For all cash flow hedges,
        to the extent the change in fair value of the derivative is not
        completely offset by the change in the fair value of the hedged item,
        the ineffective portion of the hedging relationship is recorded
        immediately in net earnings.

        The Company also enters into fair value hedges, including certain
        interest rate swap contracts. The fair value of these hedges is
        included in other long-term liabilities. In fair value hedges the
        change in fair value of both the hedged item attributable to the risk
        being hedged and the entire hedging item are recorded in the net
        earnings for the respective period.

        The maximum length of time over which the Company is hedging its
        exposure to future cash flow variability for anticipated transactions
        is ten years.

        Equity

        Handbook Section 3251 describes standards for the presentation of
        equity and changes in equity during the period with reference to the
        new comprehensive income standard.

        The new standards were applied retrospectively without restatement of
        prior periods on December 31, 2006 (the first day of the Company's
        2007 fiscal year), and thus prior periods presented have not been
        restated with the exception of accumulated foreign currency
        translation adjustment. The opening balance of retained earnings, net
        of income taxes, has been adjusted by the following:

        -  the difference between the previous carrying amount and the fair
           value of financial assets and liabilities designated as held for
           trading;

        -  the cumulative ineffective portion of the gain or loss on the
           hedging items in designated cash flow hedging relationships and
           the total gain or loss on the hedging items in designated fair
           value hedging relationships; and

        -  unamortized deferred debt issue expenses.

        The opening balance of accumulated other comprehensive income, net of
        income taxes, has been similarly adjusted by the following:

        -  the cumulative effective portion of the gain or loss on the
           hedging items that are included in designated cash flow hedging
           relationships; and

        -  restatement of current and prior periods to reflect the
           accumulated foreign currency translation adjustment on the
           translation of certain subsidiaries from a separate category of
           shareholders' equity.

        The transitional impact of the new standards on relevant items in the
        Company's opening Balance Sheet for 2007 is summarized as follows:

        1.  Accounts receivable (derivative assets) - increase of
            $37.0 million
        2.  Loans receivable - decrease of $3.7 million
        3.  Long-term receivables and other assets (debt issue expenses net
            of derivative assets) - decrease of $0.9 million
        4.  Future income taxes (current asset) - decrease of $9.7 million
        5.  Future income taxes (long-term liability) - decrease of
            $4.4 million
        6.  Accounts payable - increase of $6.8 million
        7.  Other long-term liabilities (derivative liabilities) - increase
            of $12.9 million
        8.  Long-term debt - decrease of $2.5 million
        9.  Opening retained earnings - decrease of $4.4 million
        10. Accumulated other comprehensive income - increase of
            $14.3 million

    3.  Loans Receivable

        The Company sells pools of loans receivable ("the Loans") to third
        party trusts ("the Trusts") in transactions known as securitizations.
        Loans include both credit card and personal loans receivable. The
        transactions are accounted for as sales in accordance with Accounting
        Guideline 12, "Transfers of Receivables" ("AcG-12"), and the Loans
        are removed from the Consolidated Balance Sheets. The Company retains
        the interest-only strip, and for the personal loan securitization, a
        subordinated interest in the loans sold (the "seller's interest") and
        cash deposited with one of the Trusts (the "securitization reserve"),
        all of which are retained interests. The seller's interest and
        securitization reserve provide that Trust with a source of funds in
        the event that the interest and principal collected on the Loans is
        not sufficient to pay the Trust's creditors. The Trusts' recourse to
        the Company is limited to the retained interests. The Company also
        assumes responsibility for servicing the Loans, for which it does not
        receive any direct compensation.

        The proceeds of the sale are deemed to be the cash received,
        interest-only strip and securitization reserve, less any servicing
        obligation assumed. The proceeds are allocated between the Loans,
        interest-only strip, seller's interest and securitization reserve
        based on their relative fair value at the date of sale, with any
        excess or deficiency recorded as a gain or loss on sale respectively.
        The Company estimates fair values by discounting future cash flows or
        comparing the appropriate yield curves to matching maturity terms.
        Retained interests are measured at fair value and are reviewed for
        impairment on a quarterly basis. For the 13 weeks ended June 30,
        2007, the Company recognized a pre-tax gain of $5.5 million (2006 -
        $3.4 million pre-tax loss) on the securitization of the Loans. For
        the 26 weeks ended June 30, 2007, the Company recognized a pre-tax
        gain of $2.5 million (2006 - $16.1 million pre-tax loss).

        As the Company does not control the Trusts, they have not been
        consolidated in these financial statements.

        Quantitative information about loans managed and securitized by the
        Company is as follows:

    (Dollars in millions)                                  Average balances
                           Total principal amount          for the 26 weeks
                           of receivables as at(1)                ended
                       -------------------------------   --------------------
                        June 30,    July 1,  December     June 30,    July 1,
                           2007       2006   30, 2006        2007       2006
                       ---------  ---------  ---------   ---------  ---------
    Total net managed
     credit card loans $3,484.8   $3,133.2   $3,372.3    $3,318.9   $3,048.8
    Credit card loans
     sold              (2,828.3)  (2,376.5)  (2,702.9)   (2,697.5)  (2,366.5)
                       ---------  ---------  ---------   ---------  ---------
    Credit card loans
     held                 656.5      756.7      669.4       621.4      682.3
    Net managed
     personal and
     mortgage loans(2)    187.1      260.1      226.9       206.1      259.7
    Loans sold            (88.1)    (163.8)    (124.5)     (106.0)    (185.3)
                       ---------  ---------  ---------   ---------  ---------
    Loans held             99.0       96.3      102.4       100.1       74.4

                       ---------  ---------  ---------   ---------  ---------
    Total loans
     receivable           755.5      853.0      771.8    $  721.5   $  756.7
                                                         ---------  ---------
                                                         ---------  ---------
    Less: long-term
     portion (3)           72.2       71.3       77.6
                       ---------  ---------  ---------
    Current portion of
     loans receivable  $  683.3   $  781.7   $  694.2
                       ---------  ---------  ---------
                       ---------  ---------  ---------

        (1)   Amounts shown are net of allowance for credit losses.
        (2)   Personal loans are unsecured loans that are provided to
              qualified existing credit cardholders for terms of three to
              five years. Personal loans have fixed monthly payments of
              principal and interest; however, the personal loans can be
              repaid at any time without penalty. Mortgage loans are issued
              for terms of up to ten years, have fixed or variable interest
              rates and are secured.
        (3)   The long-term portion of loans is included in "Long-term
              receivables and other assets".

        Net credit losses for the 13 weeks ended June 30, 2007 were
        $51.8 million (2006 - $50.5 million). Net credit losses for the 26
        weeks ended June 30, 2007 were $104.0 million (2006 -
        $101.7 million). Net credit losses are charge-offs net of recoveries
        and are based on the total managed portfolio of loans receivable.

    4.  Employee Future Benefits

        The net employee future benefit expense for the 13 weeks and 26 weeks
        ended June 30, 2007 was $1.6 million (2006 - $1.8 million) and
        $3.3 million (2006 - $3.6 million), respectively.

    5.  Diluted Earnings Per Share

        The reconciliation of the number of shares used in the diluted
        earnings per share calculation is as follows:

                                13 weeks    13 weeks    26 weeks    26 weeks
                                   ended       ended       ended       ended
                                 June 30,     July 1,    June 30,     July 1,
                                    2007        2006        2007        2006
                              ----------- ----------- ----------- -----------
    Average number of shares
     for basic earnings per
     share calculations       81,485,464  81,588,883  81,494,477  81,536,377
    Dilutive options                   -     759,574           -     834,223
                              ----------- ----------- ----------- -----------
    Average number of shares
     for dilutive earnings per
     share calculations       81,485,464  82,348,457  81,494,477  82,370,600
                              ----------- ----------- ----------- -----------

        Effective November 2006, all outstanding stock options have a feature
        that enables the employee to exercise the stock option or receive a
        cash payment equal to the difference between the market price of a
        Class A Non-Voting Share at the exercise date and the exercise price
        of the stock option. As the employee can request settlement in cash
        and the Company is obligated to pay cash upon demand, compensation
        expense is accrued over the vesting period of the stock options based
        on the expected total compensation to be paid upon the stock options
        being exercised. Accordingly, outstanding stock options have no
        dilutive impact on the average number of shares outstanding. For
        further details of the terms of the stock option plans prior to
        amendment, please refer to Note 10 to the most recently prepared
        annual financial statements for the 52 weeks ended December 30, 2006.

    6.  Share Capital

        (Dollars in millions)                    June 30,   July 1, December
                                                    2007      2006  30, 2006
                                                --------- --------- ---------
        Authorized
          3,423,366 Common Shares
          100,000,000 Class A Non-Voting Shares
        Issued
          3,423,366 Common Shares
           (July 1, 2006 - 3,423,366)            $   0.2   $   0.2   $   0.2
          78,051,027 Class A Non-Voting Shares
           (July 1, 2006 - 78,117,571)             701.0     709.1     702.5
                                                --------- --------- ---------
                                                 $ 701.2   $ 709.3   $ 702.7
                                                --------- --------- ---------
                                                --------- --------- ---------

        The Company issues and repurchases Class A Non-Voting Shares.  The
        net excess of the issue price over the repurchase price results in
        contributed surplus. The net excess of the repurchase price over the
        issue price is allocated first to contributed surplus, to the extent
        of any previous net excess from the issue of share with any remainder
        allocated to retained earnings.

        The following transactions occurred with respect to Class A Non-
        Voting Shares:

                                 26 weeks ended            26 weeks ended
    (Dollars in millions)         June 30, 2007             July 1, 2006
                           -------------------------  -----------------------
                                Number          $         Number         $
                           --------------  ---------  -------------  --------
    Shares outstanding at
     the beginning of the
     period                   78,047,456      702.5     78,032,724     702.5
    Issued                       290,571       22.0        678,247      33.4
    Repurchased                 (287,000)     (22.3)      (593,400)    (39.0)
    Excess of repurchase
     price over issue price
     (issue price over
     repurchase price)                 -       (1.2)             -      12.2
                           --------------  ---------  -------------  --------
    Shares outstanding at
     the end of the period    78,051,027      701.0     78,117,571     709.1
                           --------------  ---------  -------------  --------
                           --------------  ---------  -------------  --------

    7.  Minority Interest

        The Company was the general partner in a limited partnership for
        purposes of raising $300 million of capital in relation to a
        portfolio of its retail properties. The partnership invested in the
        retail properties by way of a note and equity in an entity that owns
        the portfolio of properties. The partnership had an indefinite life,
        but could be liquidated in certain circumstances. The assets and
        liabilities, results of operations and cash flows of the partnership
        were included in the financial statements of the Company. The
        preferred interest was treated as minority interest on the
        Consolidated Balance Sheets and in the Consolidated Statements of
        Earnings.

        On April 3, 2006, the $300 million note was repaid and the equity was
        redeemed. The limited partnership repaid the limited partners.
        Accordingly, the minority interest ceased to be reflected on the
        Consolidated Balance Sheets after April 3, 2006, and no further
        charge has been reflected in the Consolidated Statements of Earnings
        after April 3, 2006.

    8.  Segmented Information -Statement of Earnings


    -------------------------------------------------------------------------
                                13 weeks    13 weeks    26 weeks    26 weeks
                                   ended       ended       ended       ended
                                 June 30,     July 1,    June 30,     July 1,
    (Dollars in millions)           2007        2006        2007        2006
    -------------------------------------------------------------------------
    Gross operating revenue1
      CTR                     $  1,517.5  $  1,518.8  $  2,592.2  $  2,488.0
      Financial Services           197.5       179.6       379.8       341.3
      Petroleum                    445.6       408.1       808.4       743.2
      Mark's                       187.2       170.1       339.3       298.8
      Eliminations                 (31.1)      (29.0)      (59.6)      (51.6)
      Total gross operating
       revenue                $  2,316.7  $  2,247.6  $  4,060.1  $  3,819.7
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Earnings (loss) before
     income taxes and
     minority interest
      CTR                     $     88.7  $     97.9  $    128.7  $    136.4
      Financial Services            68.6        44.5       114.0        73.9
      Petroleum                      6.4        (1.2)        8.9         0.5
      Mark's                        24.5        20.3        35.8        28.7
                             ------------------------------------------------
      Total earnings before
       income taxes and
       minority interest      $    188.2  $    161.5  $    287.4  $    239.5
    Income taxes                    65.9        58.1       100.6        86.2
    Minority interest                  -         0.1           -         2.4
                             ------------------------------------------------
    Net earnings              $    122.3  $    103.3  $    186.8  $    150.9
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Interest expense
      CTR                     $     23.2  $     26.9  $     45.4  $     50.0
      Financial Services             4.6         6.4         8.1         9.4
      Petroleum                        -           -           -           -
      Mark's                         0.7         0.9         1.1         1.4
      Eliminations                 (12.1)      (13.1)      (22.2)      (20.6)
                             ------------------------------------------------
      Total interest expense  $     16.4  $     21.1  $     32.4  $     40.2
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Depreciation and
     amortization expense
      CTR                     $     38.6  $     36.6  $     75.4  $     72.5
      Financial Services             3.0         3.1         6.3         6.3
      Petroleum                      4.1         3.7         8.1         7.3
      Mark's                         4.5         3.8         8.8         7.7
                             ------------------------------------------------
      Total depreciation and
       amortization expense   $     50.2  $     47.2  $     98.6  $     93.8
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (1) Gross operating revenue includes dividend and interest income.

    Segmented Information - Total Assets

    -------------------------------------------------------------------------
    (Dollars in millions)                      As at       As at       As at
                                             June 30,     July 1,   December
                                                2007        2006    30, 2006
    -------------------------------------------------------------------------
    CTR                                    $ 4,442.6   $ 3,896.8   $ 4,502.5
    Financial Services                       1,306.5     1,472.9     1,476.0
    Petroleum                                  256.8       239.2       477.9
    Mark's                                     444.6       367.4       406.7
    Eliminations Total                      (1,016.9)     (919.6)   (1,058.5)
                                          -----------------------------------
                                           $ 5,433.6   $ 5,056.7   $ 5,804.6
    -------------------------------------------------------------------------

    9.  Cash and Cash Equivalents (Bank Indebtedness)

        The components of cash and cash equivalents are:


        (Dollars in millions)                    June 30,   July 1, December
                                                    2007      2006  30, 2006
                                                --------- --------- ---------
        Cash                                     $(146.7)  $(142.0)  $ (47.4)
        Short-term investments                     129.8     234.9     788.7
                                                --------- --------- ---------
        Cash and cash equivalents (bank
         indebtedness)                           $ (16.9)  $  92.9   $ 741.3
                                                --------- --------- ---------
                                                --------- --------- ---------

        As at June 30, 2007, the balance of $(16.9) million has been
        classified as bank indebtedness. The negative cash balance is due to
        outstanding cheques, not bank borrowings.

    10. Supplementary Cash Flow Information

        The Company paid income taxes during the 13 weeks ended June 30,
        2007, amounting to $150.8 million (2006 - $51.3 million) and made
        interest payments of $28.5 million (2006 - $27.4 million). For the
        26 weeks ended June 30, 2007, the Company paid income taxes amounting
        to $256.2 million (2006 - $127.8 million) and made interest payments
        of $43.3 million (2006 - $47.8 million).

        During the 13 weeks ended June 30, 2007, property and equipment were
        acquired at an aggregate cost of $167.7 million (2006 -
        $84.1 million), of which $28.8 million (2006 - $7.1 million) was
        included in accounts payable and other. During the 26 weeks ended
        June 30, 2007, property and equipment were acquired at an aggregate
        cost of $293.3 million (2006 - $167.7 million), of which
        $28.8 million (2006 - $7.1 million) was included in accounts payable
        and other.

    11. Tax Matters

        In the ordinary course of business, the Company is subject to ongoing
        audits by tax authorities. While the Company believes that its tax
        filing positions are appropriate and supportable, from time to time
        certain matters are reviewed and challenged by the tax authorities.

        The Canada Revenue Agency (CRA) has reassessed and is expected to
        issue further reassessments regarding the tax treatments of
        commissions paid to foreign subsidiaries of the Company (covering
        periods from 1995 onwards), and dividends received on an investment
        made by a wholly-owned subsidiary of the Company related to
        reinsurance (covering periods from 1999 to 2003). The applicable
        provincial tax authorities are expected to reassess for the
        corresponding periods. The Company does not have a significant
        exposure on these matters subsequent to the 2003 taxation year. The
        reassessment and expected reassessments in these matters are based on
        multiple grounds, some of which are highly unusual and the Company
        will appeal these reassessments as and when they are received.

        If the CRA (and applicable provincial tax authorities) were entirely
        successful in their reassessments - an outcome that the Company and
        its tax advisors believe to be very unlikely - it is estimated that
        the total liability of the Company for additional taxes, interest and
        penalties could be approximately $263 million. Although the Company
        will appeal these reassessments, current tax legislation requires the
        Company to remit to the CRA and its provincial counterparts
        approximately $163 million, of which $157 million had been remitted
        by the end of the quarter. In the event that the Company is
        successful in its appeal, in whole or in part, some, or all of the
        funds remitted to the various tax authorities will be refunded to the
        Company.

        The Company regularly reviews the potential for adverse outcomes in
        respect of tax matters. The Company believes that the ultimate
        disposition of these reassessments will not have a material adverse
        effect on its liquidity, consolidated financial position or results
        of operations because the Company believes that it has adequate
        provision for these tax matters. Should the ultimate outcome
        materially differ from the provisions, the Company's effective tax
        rate and its earnings could be affected positively or negatively in
        the period in which the matters are resolved.

    12. Comparative Figures

        Certain of the prior period's figures have been reclassified to
        conform to the current year presentation.
    

    Interest Coverage Exhibit to the Consolidated Financial Statements
    -------------------------------------------------------------------------

    The Company's long-term interest requirements for the 52 weeks ended
June 30, 2007, after annualizing interest on long-term debt issued and retired
during this period, amounted to $75.7 million. The Company's earnings before
interest on long-term debt, income taxes and minority interest for the
52 weeks then ended were $668.3 million, which is 8.8 times the Company's 
long-term interest requirements for this period.

    %SEDAR: 00000534E




For further information:

For further information: Media: Caroline Casselman, Director, Community
& Public Affairs, (416) 480-8159, caroline.casselman@cantire.com; Investors:
Scott Bonikowsky, Vice President, Corporate Affairs & Investor Relations,
(416) 480-8570, bonikowsky@cantire.com

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Canadian Tire Corporation, Limited

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