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Canadian Tire expanding Sport Chek, closing others

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Canadian Tire Corp Ltd's (CTC-T) sporting goods chain, FGL Sports, will close 115 under-performing corporate stores and add larger new-concept stores.

Canadian Tire, which sells automotive products, housewares and sporting goods, said FGL Sports plans to add more than 100 new Sport Chek and Atmosphere stores over the next five years.

The company bought FGL Sports, formerly Forzani Group Ltd., last year.

"In our work leading up to the acquisition of Forzani, it was clear that banner closures would be necessary and that was built into our financial modeling," Michael Medline, president of FGL Sports, said in a statement.

"These banners are expected to be generating unprofitable sales at the time they are closed," Medline said.

Stand-alone corporate locations for Sport Mart, Athletes World, Nevada Bob's Golf, Hockey Experts, Fitness Source and Econosports, will either be converted to a Sport Chek or Atmosphere store or will be closed by the end of the first quarter of 2013, the company said.

The company plans to expand FGL Sports across Canada, especially in Ontario and in the Greater Toronto Area, where it has been underrepresented.

Sport Chek will be the key "super brand" outside Quebec, the company said. The new flagship Sport Chek stores will be opened, starting in 2013.

Canadian Tire will develop Atmosphere as its outdoor lifestyle banner across the country.

The company estimates pre-tax costs related to the closures to be $26 million and expects most of it to be recognized in the second quarter.

The closures do not impact any of FGL Sports' franchise banners or franchise store locations.

It will make efforts to retain as many employees as possible through transfers to converted or new stores, the company said.

CTV.ca CTV Two CTV News CTV News Channel BNN - Business News Network CP24