Mr. Greg Hicks reports

CANADIAN TIRE CORPORATION ANNOUNCES SALE OF HELLY HANSEN TO KONTOOR BRANDS; SIMPLIFYING CTC PORTFOLIO TO FOCUS ON CANADIAN RETAIL GROWTH

Canadian Tire Corp. Ltd. has signed a definitive agreement to sell its Helly Hansen business to Kontoor Brands Inc. for total gross proceeds of $1,276-million, subject to closing adjustments. The transaction reflects Canadian Tire's increasing focus on its Canadian retail portfolio.

Helly Hansen is an iconic, global brand which designs and develops products used by professionals and outdoor enthusiasts around the world. Its high-performance apparel and gear are sold worldwide, including in Canadian Tire, SportChek and Mark's stores in Canada.

"As our strategy becomes more singularly focused on great Canadian retail, it is time to pass this iconic brand into global hands," said Greg Hicks, president and chief executive officer, Canadian Tire. "For six years, we have been proud stewards of Helly Hansen, expanding its popularity and foothold into more parts of the world -- increasing sales, brand awareness, and elevating value in the process. This divestiture unlocks that value for our company and shareholders."

Canadian Tire and Kontoor anticipate a smooth transition for employees, customers and partners.

"As we shift from brand owner to brand customer, we expect Helly Hansen's world-class products to remain on our shelves and on the shopping lists of our customers. We are excited to see where Kontoor takes the brand next," said Mr. Hicks. "We thank the Helly Hansen team and leaders for their exceptional work, and for sharing great lessons in sourcing, brand design and high-performance products with our CTC experts."

Use of proceeds

The company intends to adopt a balanced approach to the allocation of the transaction proceeds, consistent with its past practice. Proceeds are expected to be deployed to a combination of debt reduction, share repurchases, as well investments to drive customer experience and growth in its core Canadian retail business. The proceeds will also provide Canadian Tire with additional flexibility for general corporate purposes, including to address market uncertainty. Further details will be communicated in a Canadian Tire strategic update, to be published March 6, 2025.

Transaction details:

• Canadian Tire has agreed to sell the company that owns and operates the Helly Hansen brands and related businesses. In conjunction with the transaction, Canadian Tire also expects to continue to sell Helly Hansen products in its banners under a multiyear supply agreement with Kontoor Brands.
• The company expects the transaction to close in the second quarter of 2025, subject to receiving all regulatory approvals and other customary closing conditions, as well as the signing of the supply agreement between the two parties.
• The total purchase price is $1,276-million, subject to closing adjustments.
• Helly Hansen's worldwide revenue in 2024 was $894-million, including sales to Canadian Tire. Two thousand twenty-four EBITDA (earnings before interest, taxes, depreciation and amortization) was $102-million on a Canadian IFRS (international financial reporting standards) basis. Two thousand twenty-four adjusted EBITDA was $76-million under the pre-IFRS 16 accounting standard employed by Canadian Tire at the time of the Helly Hansen acquisition.

Goldman Sachs & Co. LLC is serving as Canadian Tire's exclusive financial adviser, and Norton Rose Fulbright Canada LLP as its legal adviser.

About Canadian Tire Corp. Ltd.

Canadian Tire a group of companies that includes a retail segment, a financial services division and CT REIT. Its retail business is led by Canadian Tire, which was founded in 1922 and provides Canadians with products for life in Canada across its living, playing, fixing, automotive, and seasonal and gardening divisions. Party City, PartSource and Gas+ are key parts of the Canadian Tire network. The retail segment also includes: Mark's, a leading source for casual and industrial wear; Pro Hockey Life, a hockey specialty store catering to elite players; and SportChek, Hockey Experts, Sports Experts and Atmosphere, which offer the best activewear brands. The company's close to 1,700 retail and gasoline outlets are supported and strengthened by Canadian Tire's financial services division and the tens of thousands of people employed across Canada and around the world by Canadian Tire and its local dealers, franchisees and petroleum retailers. In addition, Canadian Tire owns and operates Helly Hansen, a leading technical outdoor brand based in Oslo, Norway.

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