Canadian Tire Corporation’s (CTC's) objectives when managing capital are ensuring sufficient liquidity to support its financial obligations and execute its operating and strategic plans; maintaining healthy liquidity reserves and access to capital; and minimizing the after-tax cost of capital while taking into consideration current and future industry, market and economic risks and conditions.
The Company manages its capital structure over the long term to optimize the balance among capital efficiency,
financial flexibility, and risk mitigation. Management calculates its ratios to approximate the methodologies of
credit rating agencies and other market participants on a current and prospective basis. To assess its
effectiveness in managing capital, Management monitors these ratios against targeted ranges.
The current economic, operating and capital market environment has led to an increased emphasis on liquidity and capital management. Management is focused on ensuring sufficient liquidity, both through maintaining a strong balance sheet and ensuring access to capital.
The Company was in compliance with all financial covenants under its existing debt agreements as at September
26, 2020. The Company believes it has sufficient flexibility in the current COVID-19 environment to support
growth in its business, while remaining in compliance with its financial covenants.
Helly Hansen is required to comply with covenants established under its bank credit agreements and was in
compliance with all financial covenants thereunder as at September 26, 2020.
CT Real Estate Investment Trust (“CT REIT”) is required to comply with covenants established under its Trust
Indenture, bank credit agreement and the Declaration of Trust and was in compliance with all financial covenants
thereunder as at September 26, 2020.