Those struggles prompted
The current economic environment and level of consumer demand "differ significantly from our expectations when we set out our strategy in early 2022," said
"Our second quarter results marked a turning point in the Canadian economy," Hicks told analysts on a call.
"With 10 interest rate hikes in less than 18 months and persistent inflation impacting the cost of living and leading to reduced savings cushions, Canadian consumers are experiencing increased financial strain and facing tougher spending decisions."
He noted a "performance bifurcation" between purchases of essential and discretionary products at
Household items considered essential such as light bulbs, paper towels, brooms and other cleaning products are likely still in high demand at
But he said there's probably been a pullback for nice-to-have things such as camping and gardening equipment, or sporting goods.
"Their business model is such that, in times of recession, discretionary items are under pressure," said Winder.
"Inflation … is still running around nine per cent for food, so that's sucking a lot of the dollars out of each household. They don't have any money to spend on discretionary goods."
In the three months ended
"The discretionary softness is coming from more indebted households, most notably in
"Changes in monetary policy are softening consumer spend across the country, with the last two interest rate moves specifically creating a more pronounced demand impact in discretionary categories."
The
The central bank's decision came as it released projections suggesting inflation won't come down to its two per cent target until mid-2025, throwing cold water on the idea that rate cuts are imminent.
Given the economic climate,
That forecast also included diluted earnings per share of at least
RBC analyst
She said net results were "better than feared, highlighting the defensive nature of (
Normalized diluted earnings decreased to
The company also noted a fire at a major
This report by The Canadian Press was first published
Companies in this story: (TSX:CTC, TSX:CTC.A)
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