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UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION

Form 40-F

|_| REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934

|X| ANNUAL REPORT PURSUANT TO SECTION 13(a) OR 15(d) OF THE
THE SECURITIES EXCHANGE ACT OF 1934

|For the fiscal year
    ended April 30, 2006 | Commission File
    Number 333-10100
|-------------------------------------------- | ------------------------------------

ALIMENTATION COUCHE-TARD INC.

Quebec
      5411
      Not Applicable(Province or other jurisdiction of
      (Primary Standard Industrial
      (I.R.S.
      Employerincorporation or organization)
      Classification Code Number)
      Identification No.)


1600 St-Martin Boulevard East 
Tower B, Suite 200 
Laval, Quebec H7G 4S7, Canada 
(450) 662-6632 (Address and telephone number of Registrants principal executive
offices)

Couche-Tard Financing Corp.
  1500 North Priest Drive
  Tempe, Arizona 85281
  (602) 728-3114

(Name, address (including zip code) and telephone number
(including area code) of agent for service in the United States)

Securities registered or to be registered pursuant to Section
12(b) of the Act:

Securities registered or
to be registered pursuant to Section 12(g) of the Act:None

Securities for which
there is a reporting obligation pursuant to Section 15(d) of the Act:None

|For annual reports,
    indicate by check mark the information filed with this Form:
|------------------------------------------------------------------------------------
||X| Annual information
    form                                                     

Indicate the number of outstanding shares of each of the
issuers classes of capital or common stock as of the close of the period
covered by the annual report:

The Registrant had 56,388,652 Multiple Voting Shares and
145,651,434 Subordinate Voting Shares outstanding as at April 30, 2006. The
Registrants shares are traded on the Toronto Stock Exchange.

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Indicate by check mark whether the Registrant by filing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934 (the "Exchange Act"). If "Yes" is marked, indicate the filing number
assigned to the Registrant in connection with such Rule.

Yes
      |_|.
      No
      |X|.


Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Exchange Act
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes
      |X|.
      No
      |_|.




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DOCUMENTS FILED WITH THIS FORM 40-F

|1. | Annual
    Information Form of the Registrant for the fiscal year ended April 30, 2006.                                                                                                                                                                                                                                                                            
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                    
|2. | Consolidated balance sheets of the Registrant as at April 30, 2006 and April
    24, 2005 and the consolidated statements of earnings, contributed surplus,
    retained earnings and cash flows for each of the years in the three-year
    period ended April 30, 2006, including a reconciliation to United States
    generally accepted accounting principles.
|   |                                                                                                                                                                                                                                                                                                                                                                    
|3. | Managements Discussion and Analysis of Results and Financial Position of
    the Registrant for the year ended April 30, 2006.                                                                                                                                                                                                                                    

CONTROLS AND PROCEDURES

Within the 90 days prior to the filing date of this report,
the Registrant carried out an evaluation, under the supervision and with the
participation of the Registrants management, including the Registrants
Chairman of the Board, President and Chief Executive Officer and Executive
Vice-President and Chief Financial Officer, of the effectiveness of the design
and operation of the Registrants disclosure controls and procedures pursuant to
Exchange Act Rule 13a-14. Based upon that evaluation, the Chairman of the Board,
President and Chief Executive Officer and Executive Vice-President and Chief
Financial Officer concluded that the Registrants disclosure controls and
procedures are effective in timely alerting them to material information
relating to the Registrant (including its consolidated subsidiaries) required to
be included in the Registrants periodic Securities and Exchange Commission
filings. No significant changes were made in the Registrants internal controls
or in other factors that could significantly affect these controls subsequent to
the date of their evaluation.

MANAGEMENTS ANNUAL REPORT ON 
INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and
maintaining adequate internal control over financial reporting, as such term is
defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, for
ALIMENTATION COUCHE-TARD INC. Although under Rule 13a-15(c) under the Securities Exchange Act of 1934, we would not be required to carry out an
evaluation of the effectiveness of our internal control over financial reporting
until required by law and regulation, we have voluntarily carried out such an
evaluation, with the participation of our chief executive officer and chief
financial officer, as of the end of the latest fiscal year ended April 30, 2006.
The framework on which such evaluation was based is contained in the report
entitled "Internal Control Integrated - Framework" issued by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO). This
evaluation included review of the documentation of controls, evaluation of the
design effectiveness of controls, testing of the operating effectiveness of
controls and a conclusion on this evaluation. Although there are inherent
limitations in the effectiveness of any system of internal control over
financial reporting, based on our evaluation, we have concluded that our
internal control over financial reporting was effective as of April 30, 2006.

Raymond Chabot Grant Thornton LLP, our
independent registered public accounting firm, has issued an attestation report
on managements assessment of internal control over financial reporting for
ALIMENTATION COUCHE-TARD INC. as of April 30, 2006, which is included herein.

|(s) Alain Bouchard                              |  | (s)Richard Fortin                                       
|----------------------------------------------- |  | --------------------------------------------------------
|Alain Bouchard                                  |  | Richard Fortin                                          
|Chairman, President and Chief Executive Officer |  | Executive Vice-President and Chief Financial
    Officer
|                                                |  |                                                         

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING 
FIRM ON INTERNAL CONTROL OVER FINANCIAL REPORTING

To the Shareholders of 
Alimentation Couche-Tard Inc.
We have audited management's assessment, included in the
accompanying Managements Report on Internal Control Over Financial Reporting,
that Alimentation Couche-Tard Inc. maintained effective internal control over
financial reporting as of April 30, 2006, based on the criteria established in
Internal ControlIntegrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). Alimentation
Couche-Tard Inc.s management is responsible for maintaining effective internal
control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting. Our responsibility is to express an
opinion on management's assessment and an opinion on the effectiveness of the
Company's internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of
the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether effective internal control over financial reporting was maintained in
all material respects. Our audit included obtaining an understanding of internal
control over financial reporting, evaluating management's assessment, testing
and evaluating the design and operating effectiveness of internal control, and
performing such other procedures as we considered necessary in the
circumstances. We believe that our audit provides a reasonable basis for our
opinions.
A company's internal control over financial reporting is a
process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. A
company's internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company's assets that could have a
material effect on the financial statements.
Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
In our opinion, management's assessment that Alimentation
Couche-Tard Inc. maintained effective internal control over financial reporting
as of April 30, 2006, is fairly stated, in all material respects, based on the
criteria established in Internal ControlIntegrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

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Also in our opinion, Alimentation Couche-Tard Inc.
maintained, in all material respects, effective internal control over financial
reporting as of April 30, 2006, based on the criteria established in Internal
ControlIntegrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).
We have also audited, in accordance with Canadian generally
accepted auditing standards and the standards of the Public Company Accounting
Oversight Board (United States), the consolidated balance sheets of Alimentation
Couche-Tard Inc. as of April 30, 2006 and April 24, 2005 and the consolidated
statements of earnings, contributed surplus, retained earnings and cash flows
for each of the years in the three-year period ended April 30, 2006 and our
report dated June 14, 2006 expressed an unqualified audit opinion on those
consolidated financial statements.(s) Raymond Chabot Grant Thornton
    LLPRAYMOND
    CHABOT GRANT THORNTON LLPChartered Accountants 
Montreal, Canada 
June 14, 2006

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CHANGE IN INTERNAL CONTROLS OVER FINANCIAL REPORTING

The Registrant maintains a system of internal controls over
financial reporting. There were no changes in the Registrants internal controls
that occurred during the period covered by this report that have materially
affected, or are reasonably likely to materially affect, the Registrants
internal control over financial reporting.

NOTICES PURSUANT TO REGULATION BTR

None

AUDIT MATTERS

Audit Committee

See the disclosure under "Audit Committee Disclosure" in the
Annual Information Form filed herewith.

The Board of Directors of the Registrant has determined that
it has one audit committee financial expert serving on its audit committee. Mr.
Roger Desrosiers has been determined by the Board of Directors of Couche-Tard to
meet the "independence" and the "audit committee financial expert" criteria
prescribed by the Securities and Exchange Commission ("SEC") and applicable
Canadian regulatory requirements and is independent, as that term is defined by
applicable Canadian regulatory requirements. The SEC has indicated that the
designation of Mr. Desrosiers as an audit committee financial expert does not
make Mr. Desrosiers an "expert" for any purposes, impose any duties, obligations
or liability on Mr. Desrosiers, that are greater than those imposed on members
of the audit committee and Board of Directors who do not carry this designation,
or affect the duties, obligations or liability of any other member of the audit
committee.

Audit Fees, Audit Related Fees, Tax Fees and All Other Fees

See the disclosure under "Audit Committee Disclosure  Auditors Fees" in the
Annual Information Form filed herewith.

Pre-Approval Policies and Procedures

It is within the mandate of the Registrants audit committee
to approve all audit and non-audit related fees. See the disclosure under "Audit
Committee Disclosure  Policy on the Approval of Non-Audit Services" in the
Annual Information Form filed herewith. All audit-related fees and tax fees for
services provided to the Registrant by the Registrant's auditors during the
fiscal year ended April 30, 2006 were approved by the Registrant's audit
committee.

CODE OF ETHICS

The Registrant has adopted a Code of Ethics for its Chief
Executive Officer, Chief Financial Officer and directors and officers. See the
disclosure under "Audit Committee Disclosure  Code of Ethics for CEO, CFO and
Senior Financial Officers" in the Annual Information Form filed herewith. A copy
of the Code of Ethics will be provided in print free of charge to any
shareholder who requests it by contacting the Registrant by telephone or mail.
There were no amendments or waivers to the Code of Ethics in fiscal 2005.

OFF-BALANCE SHEET ARRANGEMENTS

See the disclosure under "Off-Balance Sheet Arrangements" in
the Managements Discussion and Analysis of Results and Financial Position filed
herewith.

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TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS

See the disclosure under "Contractual Obligations and
Commercial Commitments " in the Managements Discussion and Analysis of Results
and Financial Position filed herewith.

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ALIMENTATION COUCHE-TARD INC.



ANNUAL INFORMATION FORM

Fiscal year ended April 30, 2006





July 12, 2006

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TABLE OF CONTENTS

|Subject                                                         | Page
|--------------------------------------------------------------- | ----
|                                                                |     
|Forward-Looking
    Statements                                  | 3   
|The Company                                                     | 4   
|- Name and Incorporation                                        | 4   
|- Intercorporate Relationships                                  | 4   
|General Development
    of the Business                         | 5   
|- Overview                                                      | 5   
|- History                                                       | 5   
|- Highlights of last three fiscal years                         | 5   
|Business                                                        | 7   
|- Business Strengths                                            | 7   
|- Business Strategy                                             | 8   
|- Industry                                                      | 10  
|- Store Network                                                 | 10  
|- Merchandise Operations                                        | 12  
|- Fuel Operations                                               | 13  
|- Distribution and Suppliers                                    | 13  
|- Properties                                                    | 14  
|- Information Systems                                           | 14  
|- Employees and Training                                        | 15  
|- Trade Names, Service Marks and Trademarks                     | 15  
|Competition                                                     | 15  
|Environmental
    Matters                                       | 16  
|Regulatory Matters                                              | 16  
|Risk Factors                                                    | 17  
|Dividends                                                       | 17  
|Capital Structure                                               | 17  
|Ratings                                                         | 18  
|Market for
    Securities                                       | 18  
|Directors and
    Officers                                      | 19  
|- Directors                                                     | 19  
|- Senior Officers                                               | 22  
|Legal Proceedings                                               | 24  
|Transfer Agent and
    Registrar                                | 24  
|Material Contracts                                              | 24  
|Audit Committee
    Disclosure                                  | 26  
|- Charter                                                       | 26  
|- Composition of the Audit Committee                            | 28  
|- Financial Literacy                                            | 28  
|- Internal Controls                                             | 29  
|- Policy on the Approval of Non-audit Services                  | 29  
|- Code of Ethics for CEO, CFO and Senior
    Financial Officers | 30  
|- Whistle-Blowing Policy                                        | 30  
|- Auditors Fees                                                 | 30  
|Additional
    Information                                      | 31  

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As used in this annual information form, unless the context
indicates otherwise: (i) "we", "our" and "us", the "Company" or "Couche-Tard»
refer collectively to Alimentation Couche-Tard Inc. and, unless the context
otherwise requires or indicates, its subsidiaries and (ii) "$" or "dollars"
refer to American dollars and "Cdn$" or "Cdn dollars" refer to Canadian dollars.FORWARD-LOOKING STATEMENTSWe make "forward-looking statements" throughout this annual
information form. Whenever you read a statement that is not simply a statement
of historical fact (such as when we describe what we "believe", "expect", or
"anticipate" will occur, what we "intend", "plan" or "seek" to do or accomplish
and other similar statements), you must remember that our expectations may not
be correct or that we may not take such actions or accomplish such goals. We do
not guarantee that the transactions and events described in this annual
information form will happen as described (or that they will happen at all). You
should read this annual information form completely and with the understanding
that actual future results may be materially different from what we expect.
Unless otherwise required by applicable securities laws, we will not update
these forward-looking statements, even though our situation changes in the
future.
Whether actual results will conform to our expectations and predictions is
subject to a number of risks and uncertainties, including:
difficulties in implementing our business strategy and technology;
  difficulties that may be encountered in the integration of the operations
  of acquired companies as well as the effects of such acquisitions;
  changes in wholesale and retail motor fuel pricing;
  changes in the regulation or taxation of cigarettes or alcohol;
  difficulties in retaining key members of our management team;
  changes in the financial markets affecting our financial structure and our
  cost of capital and borrowed money;
  compliance with and changes in environmental regulations; our level of
  debt;
  general economic conditions;
  changes in operating expenses or the need for additional capital
  expenditures; and
  changes in pricing policies by our competitors or us.

Reference is made to
"Risk Factors" herein below.

3

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THE COMPANY
Name and IncorporationThe Company was incorporated under Part IA of the Companies Act (Québec) by certificate of amalgamation dated May 1, 1988. On
December 15, 1994, The Company changed its corporate name from "Actidev Inc." to
"Alimentation Couche-Tard Inc." The Companys share capital was also changed at
that time so that it consists of an unlimited number of first preferred shares,
an unlimited number of second preferred shares, an unlimited number of multiple
voting shares and an unlimited number of subordinate voting shares. By
certificate of amendment dated September 8, 1995, the Company re-designated the
multiple voting shares as Class A multiple voting shares (the "Multiple Voting
Shares") and the subordinate voting shares as Class B subordinate voting shares
(the "Subordinate Voting Shares"). The Companys shares trade on the Toronto
Stock Exchange and, as of April 30, 2006, the Company had a total market
capitalization of approximately Cdn$ 5 billion.
The head office of the Company is located at 1600 St-Martin Blvd. East, Tower
B, Suite 200, Laval, Québec H7G 4S7.
Intercorporate Relationships

The following chart illustrates the corporate organization of the Company and
its principal subsidiaries, all of which are 100% owned.



4

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GENERAL DEVELOPMENT OF THE BUSINESS
OverviewWe are the leader in the Canadian convenience store industry.
We are the third largest convenience store operator in North America and the
second largest independent (not integrated with a petroleum company) convenience
store operator in North America and the most profitable one as a publicly traded
company within such category. As at April 30, 2006, our network consisted of
4,983 convenience stores, 3,085 of which include motor fuel dispensing, located
in eight large geographic markets, including three in Canada and five in the
United States, which cover 23 American states.
We sell food and beverage items, motor fuel and other
products and services targeted to meet our customers' demand for convenience and
quality in a clean and welcoming environment. We believe that our business model
has differentiated Couche-Tard from its competition through its decentralized
management structure, commitment to operational expertise, focus on in-store
merchandise, particularly the higher growth and higher margin foodservice
category, and continued investment in store modernization and technology.
The convenience store industry is fragmented, with the top 10
operators representing only approximately 25% of the estimated total of 138,200
stores in the United States. Industry consolidation by highly leveraged
operators in the 1990's, combined with competition and fluctuations in motor
fuel margins, has led to numerous corporate restructurings and rationalizations
in recent years. As a result, we believe the opportunity exists for
well-capitalized, established industry participants to grow through mergers and
acquisitions.
History

Alain Bouchard, the Chairman, President and Chief Executive
Officer of Alimentation Couche-Tard Inc., started the chain with one store in
1980. In 1986, with a network of 34 stores, a predecessor of Couche-Tard
completed an initial public offering and listed its shares on the Montreal
Exchange. In 1994, the predecessor company was privatized by its majority
shareholder, Actidev Inc., a publicly held company. Later that year, Actidev
Inc. changed its corporate name to "Alimentation Couche-Tard Inc."
After establishing a leading position in Quebec, Couche-Tard
expanded through internal growth and acquisitions in Ontario and Western Canada
in 1997. In May 1997, Couche-Tard acquired 245 Provi-Soir stores in
Quebec and 50 Winks stores in Ontario and Western Canada from Provigo
Inc. In April 1999, Couche-Tard acquired 980 stores in Ontario and Western
Canada operating under the Macs, Mikes Mart and Beckers
banners through the acquisition of Silcorp Limited, a publicly-held company.
Beginning in 2001, Couche-Tard began making acquisitions in the United States
namely in June 2001, whereby it acquired 172 stores under the Bigfoot
banner located in Indiana, Illinois and Kentuky. In August 2002, Couche-Tard
acquired 287 stores under the Dairy Martbanner located in these states
and other located in Pennsylvania and Michigan. Recently, in December 2003,
Couche-Tard acquired from Circle K 1,663 stores located in 16 states in addition
to the 627 franchised stores and under licence.Highlights of Last Three fiscal Years

Fiscal 2006

In August 2005, the Company granted a master franchise agreement for Mexico
for the Circle K Brand to a subsidiary of Grupo Kaltex, S.A. de C.V. providing
for the opening of 250 stores within the next five years.

In November 2005, the Company acquired from Ports Petroleum
Co. seven stores, all with motor fuel facilities located in Ohio, United States.
Most of these stores are located around Cleveland, Ohio. Pursuant to this
transaction, the Company bought the land and buildings for six locations, and
leases the other one.

In December 2005, the Company acquired from Conway Oil
Company and Conway Real Estate Company 16 stores with motor fuel. Most of them
are located in and around Alburquerque, New Mexico, and ten offer car wash
facilities. Pursuant to this
transaction, the Company bought the land and buildings for ten locations, and
leases the other six.

5

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In December 2005, the Company signed an agreement with
ConocoPhillips Company which resulted in the conversion of an additional 75
convenience stores of ConocoPhillips network, located in the Western half of
the U.S., to the Circle K banner.
In December 2005, the Company acquired from BP Products North
America, Inc. 26 stores with motor fuel facilities located in the Memphis region
of Tennessee, United States. Pursuant to this transaction, the Company bought
the land and buildings for 22 locations, leases two and the other two are owned
and operated by existing dealers.
In December 2005, the Company withheld from renewing the Taiwan license which
is comprised of 800 franchised stores owned and operated by the Taiwanese
licensee under the Circle K banner within the Taiwan territory.
In March 2006, the Company acquired from Shell Oil Products
US 40 stores with motor fuel facilities and assumed an additional 13 fuel supply
contracts in Indianapolis, Indiana, US. Pursuant to this agreement, the Company
bought the land and buildings for 29 convenience stores, bought the land and
leases the premises for one and leases the other ten.
In April 2006, the Company acquired six stores in the Tallahassee region of
Florida from Capcirc Properties, LLC. Pursuant to this transaction, the Company
bought the land and buildings for five locations, and leases the other one.

In April 2006, the Company announced that it had signed an
agreement with Spectrum Holding, Inc. to purchase 90 stores with motor fuel
facilities located in major markets throughout the States of Georgia and
Alabama. As indicated, the transaction closed at the beginning of June 2006.
Thirty-five locations have drive-through car washes and 13 quick-service
restaurants. Pursuant to this agreement, the Company bought the land and
buildings for 58 of these locations, five fee/lease properties, with the
remaining sites under long term leases.

Fiscal 2005:

During the second quarter of the fiscal year, the Company entered into an
agreement with Allied Domecq Quick Services Restaurants for the development of
65 Dunkin Donuts sites in Ohio within the next six years.

In November 2004, the Company purchased 22 sites in the Phoenix Metro area
from Shell Oil Products US for an aggregate amount of $ 34.1 million. Most of
these sites sell motor fuel.

On March 18, 2005, the Multiple Voting Shares and the Subordinate Voting
Shares of the Company were split on a two-for-one basis.

In February 2005, the Company acquired 19 stores in the Augusta region of
Georgia. These sites sell motor fuel.

Finally in April 2005, the Company acquired ten stores in the Midwest region
of the United States, all of which sell motor fuel.

Fiscal 2004:

In August 2003, the Company and Allied Domecq Quick Service
Restaurants entered into an agreement whereby the Company acquired the master
franchisee rights for the

On September 4, 2003, Couche-Tard acquired certain assets of
Clark Retail Enterprises, Inc. for total cash consideration of $29.9 million. In
this transaction, Couche-Tard acquired 43 convenience stores, 33 of which are
located in Illinois, with the remainder in Indiana, Iowa, Michigan and Ohio. All
of the stores sell motor fuel. Couche-Tard acquired the buildings and land at 31
of these sites, with the remaining 12 being leased. On October 30, 2003,
Couche-Tard completed a sale-leaseback transaction with respect to 19 of the
Clark stores and received proceeds of approximately $15 million.

6

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On December 17, 2003, Couche-Tard acquired The Circle K
Corporation ("Circle K") from ConocoPhillips for a net cash purchase price of
$751.2 million. The Acquisition was financed through the proceeds from the
issuance of $350 million 71/2% Senior Subordinated Notes due 2013,
borrowings under our senior credit facility of an aggregate amount of $510
million and net proceeds of $168.8 million from the issuance of Class B
subordinate voting shares. (See "Material Contracts.") These credit facilities
have replaced the ones that existed prior to December 17, 2003.
In connection with the Acquisition:
Couche-Tard acquired all the outstanding capital stock of
  Circle K;
  we entered into a five-year motor fuel supply agreement
  with ConocoPhillips;
  we entered into several other related agreements with
  ConocoPhillips, including several trademark licensing agreements and a
  reseller agreement; we entered into an environmental liabilities agreement
  with ConocoPhillips; and
  we agreed to undertake certain capital improvements at the
  Circle K stores in connection with the proposed settlement of litigation
  brought against Circle K under the Americans with Disabilities Act.As at April 25, 2004 the Company had achieved excellent
progress in the Circle K integration plan with some $10 million in synergies
achieved within the first 130 days, by implementing Couche-Tards decentralized
business model at Circle K and renegotiating several merchandise supply
agreements.
In March and April 2004, the Company entered into
sale-leaseback agreements for 322 Circle K properties acquired on December 17,
2003. The net proceeds from this transaction of $252.9 million were used to
reimburse part of the long-term debt borrowed in connection with the
Acquisition.
BUSINESSBusiness StrengthsLeading Market Position.We have a network of more than 4,983 convenience stores which makes us the third
largest convenience store operator and the second largest independent (not
integrated with a petroleum company) convenience store operator and the most
profitable one as a publicly traded company within such category. We believe our
well-recognized banners, including Couche-Tard, MacsandCircle K have an established reputation for convenience and excellence in
product selection and value that helps to differentiate our stores from those of
our competitors. We believe that the geographic diversity of our network
throughout the United States and Canada reduces our exposure to adverse local
and/or regional market conditions, including fluctuations in motor fuel prices.
With more than $10 billion in revenues in fiscal 2006 and 25 years of
convenience store operations, we believe our size and experience have enabled us
to develop operating efficiencies that provide us with a competitive advantage,
particularly with respect to merchandising and purchasing.

Well-Located and Modernized Store Base. We believe
that we have high-quality stores in strategic locations. We believe that
focusing on developing networks of stores in the geographic areas in which we
operate enables us to study those markets and refine our location strategy. We
selectively choose our store sites to maximize our store traffic and visibility
and we effectively manage the closure of under-performing stores. Due to current
land prices and the unavailability of suitable properties in our primary
markets, we believe it would be difficult for our competitors and new entrants
to replicate our store base.

We have made substantial investments in our Couche-Tard
stores through our IMPACT program (i.e.
Innovation-Marketing-People-Alimentation-Couche-Tard). Couche-Tard has
implemented the IMPACT program in over 1,700 of its company-operated stores,
which represent approximately 48% of such stores. Currently, almost all of
Couche-Tards company-operated stores use scanning technology, which is
significantly higher than the industry average of approximately 78% of
convenience stores.

7

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Differentiated Business Model.We believe that our business
model has positively differentiated Couche-Tard from its competitors. The
principal elements of this business model are as follows:

Decentralized Management Structure.
We believe that our culture is entrepreneurial and that Couche-Tards management
structure is one of our most important business strengths. Couche-Tard manages
its operations and workforce in a decentralized manner in order to expedite
decision making, to address local demand for specific products and services, and
to minimize corporate overhead costs. Each store is operated as a distinct
business unit and store managers are responsible for meeting financial and
operational targets. We support our store managers with a strong, experienced
management team and capital resources, which we believe provide our managers
with a significant competitive advantage compared to smaller operators. In
addition, we implement a rigorous performance measurement or "benchmarking"
process to ensure that best practices are deployed across our network and to
allow us to provide timely and effective feedback to our managers at all levels.

Commitment to Operational Expertise.

Focus on In-store Merchandise.

Experienced and Incentivized Management Team with a Proven
Track Record.

8

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Business Strategy

We plan to continue growing our business and improving our financial
performance by implementing our business strategy, the key elements of which
include:

Drive Internal Sales Growth and Profitability.

In-Store Branding.

IMPACT Program.

Quick Service Restaurants ("QSR").

Invest in Store Modernization and Information Systems

We have made significant investments in technology because we
believe that the information generated from such systems is critical to the
operation of our business. By analyzing the data generated by our point-of-sale
("POS") systems, we are better able to adjust our product and service mix to
meet local demands, eliminate slow-moving inventory items, and optimize our
purchasing activities.

Leverage Supplier Relationships

9

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Selectively Expand Our Store Network

Industry

The convenience store industry is undergoing significant
structural changes, including increased competition from new market entrants
such as drug stores, warehouse clubs, large supermarkets and other mass
retailers (commonly known as hypermarkets) which have added convenience store
staple products such as bread, milk and packaged beverages to their product mix.
In addition, an increasing number of hypermarkets are selling motor fuel at low
prices in an attempt to establish themselves as a one-stop shopping location and
to increase customer trip frequency and traffic at their stores. See
"Competition".

In response to heightened competition in the industry,
convenience stores are extending their range of traditional products and
services to include calling cards, financial services, photo developing, QSRs
and other products and services. In addition to being conveniently located and
open for extended hours, convenience stores now cater to customers with busy
schedules who expect to find a wide assortment of items in stock and to have
many available payment options. Convenience stores are also catering to
time-pressed consumers looking for "grab-and-go" items by offering fresh food
and baked goods prepared on-site. As a result, those convenience store operators
with superior merchandising, distribution expertise and capital can overcome the
challenges resulting from rising operating costs and increased customer demands.

Store Network

Couche-Tard is the largest Canadian convenience store
operator with a network of 2,064 convenience stores in Canada and has a
significant presence in the United States with an additional 2,919 stores. Of
the 4,983 Couche-Tard stores, 3,632 are company-operated and 1,351 are operated
under our affiliate program. Motor fuel is sold at 65% of Couche-Tards
company-operated stores.
Couche-Tards Canadian stores are located in Quebec, Ontario, Alberta, British
Columbia, Manitoba, Saskatchewan and the Northwest Territories, and its U.S.
stores are located in 23 U.S. states, including Ohio, Indiana, Kentucky,
Illinois, Michigan, Pennsylvania, Iowa, Arizona, Florida, California, Louisiana
and Texas. The Couche-Tard stores are primarily operated under the
Couche-Tard and
Macs banners in Canada
and the Circle K banner
in the United States.

Couche-Tards stores, which are located in a variety of
high-traffic areas, include freestanding stores and stores located in strip
shopping centres. Couche-Tards stores in Canada and in the U.S. Midwest are
designed to appeal to customers in their local markets, rather than conforming
to a single standard format. The Circle K stores simple and consistent design
makes them easily recognizable. The majority of the stores are open seven days a
week, 24 hours a day, with peak customer traffic in the early morning and late
afternoon. The size of the typical Couche-Tard store is between 2,000 and 2,500
square feet, while newly-developed stores are typically approximately 3,000
square feet, to accommodate in-store seating and, in certain cases, QSRs.

The following table sets out the number of Couche-Tards stores in operation
by geographic location and type of store as of April 30, 2006.

|               |                  | Total     | Company- |            | Percentage
|-------------- | ---------------- | --------- | -------- | ---------- | ----------
|               |                  | Number of | Operated | Total      | of Total  
|Region         | Provinces/States | Stores    | Stores   | Affiliates | Stores    
|               |                  |           |          |            |           
|Eastern Canada | Quebec           | 879       | 581      | 298        | 17.64 %   
|Central Canada | Ontario          | 819       | 605      | 214        | 16.43 %   

10

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|                                |                                                                                |           | Total    |            |           
|------------------------------- | ------------------------------------------------------------------------------ | --------- | -------- | ---------- | ----------
|                                |                                                                                | Total     | Company- |            | Percentage
|                                |                                                                                | Number of | Operated | Total      | of Total  
|Region                          | Provinces/States                                                               | Stores    | Stores   | Affiliates | Stores    
|                                |                                                                                |           |          |            |           
|Western Canada                  | British Columbia,
    Alberta, Saskatchewan, Manitoba, Northwest Territories   | 366       | 295      | 71         | 7.34 %    
|U.S. Midwest                    | Ohio, Indiana,
    Kentucky, Illinois, Michigan, Pennsylvania, Iowa            | 692       | 528      | 164        | 13.89 %   
|U.S. West Coast                 | New Mexico,
    Western Texas, Washington, Oregon, California, Hawaii          | 564       | 284      | 280        | 11.32 %   
|U.S. Arizona
    Region         | Nevada, Arizona                                                                | 543       | 543      | 0          | 10.90 %   
|U.S. Southeast                  | Tennessee,
    Northern Mississippi, Georgia, North Carolina, South Carolina   | 283       | 275      | 8          | 5.68 %    
|U.S. Florida and
    Gulf Coast | Florida, Alabama,
    Arkansas, Louisiana, Southern Mississippi, Eastern Texas | 837       | 521      | 316        | 16.80 %   
|Total                           |                                                                                | 4,983     | 3,632    | 1,351      | 100 %     

Couche-Tard conducts its convenience store business through two main types of
arrangements, as set out below.

Company-Operated Stores.

Affiliated Store Program

a)

b)     Licensed Stores.
Couche-Tard has 522 stores operated under license agreements in Canada and the
United States that are owned and operated by independent store operators. The
licensee typically owns or leases the real property from third parties and owns
all other assets related to the business. The licensee enters into a license
agreement with Couche-Tard to use one of Couche-Tards proprietary banners and
agrees to buy merchandise from certain suppliers in order to benefit from
certain vendor rebates based on Couche-Tards purchasing volume. Couche-Tards
revenues from licensed stores includes license fees and a portion of the vendor
rebates related to the licensees purchases that are paid to Couche-Tard.

c)     Motor
Fuel Dealers. Couche-Tards Midwest Division has agreements to sell motor
fuel directly to 105 independent operators at cost plus a mark-up.

Internationally, Couche-Tard through Circle K has license
agreements for the operation and development of stores in Japan, Hong Kong,
China, Indonesia, Guam, Macao and Mexico. The terms of these agreements vary, as
do the royalty rates.

11

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Merchandise Operations

Couche-Tard offers its customers more than 3,200 product
stock keeping units ("SKUs") that include traditional convenience store items
such as packaged and frozen beverages, candy and snacks, coffee, dairy items,
beer/wine and tobacco products, as well as products not traditionally offered by
convenience stores such as fresh food and foodservice items. In addition,
services such as automatic teller machines and lottery ticket sales are featured
in many stores. Couche-Tard is continually looking for new product ideas, such
as cell phones, prepaid phone cards and home office supplies, to offer to its
customers to meet their convenience needs. Couche-Tard evaluates store product
assortment on an ongoing basis to ensure that low turnover products are replaced
by top selling items in order to maximize selling space and ensure that high
demand items are available to the consumer.

Couche-Tard employs category management as a merchandising
tool and assigns internal "category managers" for its top selling products in
each region. These category managers are experts on the products within their
responsibilities, and they use their in-depth knowledge of the products sales
trends, regional preferences, popularity and producers in deciding which items
to stock in a particular geographical region.

Based on merchandise purchase and sales information, Couche-Tard estimates
category revenues as a percentage of total in-store merchandise sales for the
last fiscal year as follows:

|                                 | Percentage of
|-------------------------------- | -------------
|Category                         | Total        
|                                 |              
|Tobacco Products                 | 36.6         
|Beer/Wine/Liquor                 | 16.4         
|Grocery                          | 14.3         
|Beverages                        | 13.5         
|Food Service                     | 11.1         
|Candy/Snacks                     | 8.1          
|Total In-Store Merchandise Sales | 100.0%       

In order to grow its merchandise sales and increase profits,
Couche-Tard focuses primarily on developing its banners and brands, growing and
refining its IMPACT program and expanding its QSR business.

Branding.

IMPACT Program.

12

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Quick Service Restaurants.

Fuel Operations

Prior to Couche-Tards entry into the U.S. market,
approximately 70% of total revenues were generated from merchandise and service
revenues and 30% from motor fuel sales. The mix has been altered since the
acquisition of Bigfoot, Dairy Mart and Circle K, as these companies had a
greater reliance on motor fuel sales than Couche-Tard. In fiscal 2006,
Couche-Tards motor fuel sales in Canada represented about 38% of its Canadian
revenues compared to approximately 64% of revenues for its U.S. stores.

Generally, Couche-Tards company-operated stores sell both
branded and unbranded motor fuel by purchasing the motor fuel and reselling it
at a profit. In addition, Couche-Tard earns a commission for supplying unbranded
motor fuel on a consignment basis to company-operated stores in respect of which
it does not own the pumps or storage tanks. Couche-Tard also acts as agent in
the sale of motor fuel to some of its franchise stores and receives a
commission. At select locations in the United States only, Couche-Tard sells
motor fuel to independent store operators for cost plus a mark-up. Except for
sales made on a commission basis for which only the commission is recorded as
motor fuel revenues, Couche-Tard includes the full value of such sales in its
motor fuel revenues.

The wholesale price in Couche-Tards supply agreements with
major oil companies is typically set by the oil company supplying the motor
fuel. Generally, Couche-Tard obtains the fuel at a price referred to as the
"rack to retail price" and sets the retail price.

Couche-Tard sells motor fuel either under its own brands, including
Couche-Tard and
Macs in Canada and
Circle Kin the United
States, or under the name of major oil companies such as
Esso, Petro-Canada, Shell,
Irving, Ultramar,
BP,
7,
Phillips 66, Marathon, Citgo, HuskiandSunoco.

Distribution and Suppliers

Merchandise Distribution and Supply Arrangements.

In Central Canada, Couche-Tard uses Karrys Bros., Limited as
a regional warehouse supplier to distribute the majority of its in-store
merchandise on an exclusive basis to its company-operated stores and on a
non-exclusive basis to affiliates. Couche-Tard also purchases products such as
carbonated beverages and potato chips, which are not covered under the
arrangement with Karrys, directly from manufacturers and producers. Similarly,
Couche-Tard uses Core-Mark International Inc. as its exclusive supplier for the
majority of its in-store merchandise to its Western Canada stores. Couche-Tard
has an exclusive supply agreement with Eby-Brown Company to supply the majority
of its in-store merchandise for all of its company-operated stores in the U.S.
Midwest. To the extent required, the remainder of the products are purchased on
a non-exclusive basis from regional

13

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In Eastern Canada, Couche-Tard operates its own distribution
centre in Laval, Quebec through which most deliveries to Couche-Tards Quebec
stores are channelled, with the remainder of supplies being delivered directly
to the stores by the manufacturers. The distribution centre was established to
allow Couche-Tard to provide integrated, high-quality services to the 649
Couche-Tard stores dispersed throughout the province. The distribution centre
has enabled Couche-Tard to increase the frequency of its delivery of dairy
products and fresh and frozen foods from once to at least twice a week.

Circle K has a distribution centre in Arizona which is
managed by Core-Mark International Inc. pursuant to a contract for a fee. The
distribution centre services approximately 562 Circle K stores. The distribution
centre allows Circle K to utilize its buying power for warehouse-delivered items
plus certain dairy, bakery, sandwich, ice cream and snack items through vendor
consolidation with the Arizona distribution centre.

Two types of suppliers provide merchandise to Circle K
stores. Direct store delivery suppliers generally supply items such as beer,
soft drinks, snack items, newspapers, milk and bread directly to the stores,
while warehouse suppliers provide cigarettes, fountain cups, groceries, health
and beauty aids, and candy and snacks to the Circle K stores in all areas
outside of Arizona. Circle K also uses Core-Mark as a warehouse supplier to
distribute merchandise to the majority of its stores west of the Mississippi and
to provide management services to the Circle K distribution centre located in
Arizona. Circle K uses McLane Company, Inc. to distribute merchandise to the
majority of its stores east of the Mississippi.

Motor Fuel Supply Arrangements.

Circle K has entered into a supply agreement with
ConocoPhillips pursuant to which ConocoPhillips will provide, for at least the
next five years, subject to cancellation of Couche-Tard subject to certain
conditions, a supply of gasoline and diesel for the stores covered by such
supply agreement. In 2004, Circle K gave notice to terminate its supply
arrangement with ConoccoPhillips for California and Arizona.

Properties

Of the 3,632 company-operated stores, 2,807 are leased and
825 are owned by Couche-Tard, while the remaining 1,351 stores are either leased
or owned by affiliates and franchisees. Most of the owned properties are located
in Quebec. Couche-Tard believes that none of the leases is individually material
to it. Most of the leases are net leases requiring Couche-Tard to pay taxes,
insurance and maintenance costs. Generally our real estate leases in Canada are
for primary terms of five to ten years and in the United States, they are for 10
to 20 years, in both cases, with options to renew. Under certain of the store
leases, we are subject to additional rentals based on store revenues as well as
escalations in the minimum future lease amount.

Couche-Tard leases its corporate headquarters in Laval,
Quebec. Management believes that Couche-Tards headquarters are adequate for its
present and foreseeable needs. In addition, Couche-Tard has seven regional
offices located in Scarborough, Ontario, Calgary, Alberta, Columbus, Indiana,
Charlotte, South Carolina, Tampa, Florida, Corona, California and Tempe,
Arizona, all of which are leased. The distribution centre in Laval, Quebec is
also leased.

Information Systems

Couche-Tard uses the information obtained from its point of
sales ("POS") systems to manage its product mix at the store level. The periodic
reports generated from the data collected using POS scanners allows the store
operators to identify slow-moving inventory, track customer preferences,
optimize product assortment and effectively adapt the store to the needs of
community. Couche-Tard uses POS technology, including scanning, in all of its
Company-operated stores, including scanning. Couche-Tard is also currently
implementing new POS systems including the selective installation of touch
screens in its Macs stores and pay-at-the-pump systems for motor fuel
distribution at certain company-owned stores in all of its regions. This
technology maximizes convenience for customers while allowing Couche-Tard to
collect information on consumer habits to better implement its merchandising
strategy. In fiscal 2003, Couche-Tard established a data warehouse for all of
its Canadian divisions and is developing a wide area network, or WAN, which will
allow it to implement a perpetual inventory and in-store assisted ordering
system. The system, which is in use primarily in Quebec, is designed to optimize
the store supply process.

14

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Employees and Training

As of April 30, 2006, Couche-Tard had approximately 37,000 employees
throughout its company-operated stores, administrative offices, distribution
centre and affiliated stores.

Couche-Tard is organized in eight divisions based on
geography: Eastern Canada (Quebec), Central Canada (Ontario), Western Canada,
the U.S. Midwest, the West Coast Region, the Arizona Region, the Southeast
Region and the Florida and Gulf Coast Region, each managed by a Vice-President
of Operations. Each Vice-President is typically responsible for up to 880
stores. Each store is operated as a separate business unit and store managers
within each region are required to meet specific performance objectives. Store
managers report to market managers who are typically responsible for eight to
ten stores. Market managers report to regional directors who typically oversee
60 to 70 stores. Finally, regional directors are accountable to the regional
vice-presidents. Couche-Tards decentralized structure allows most
store-specific decisions to be made locally, rather than centrally, which
expedites the decision-making process.

Couche-Tard typically spends between 2 % and 4 % of total annual compensation
in the network on the training of its employees.

Trade Names, Service Marks and Trademarks

Couche-Tard has registered or applied for registration of a
variety of trade names, service marks and trademarks for use in its business,
which Couche-Tard regards as having significant value and as being important
factors in the marketing of the Company and its convenience stores. Couche-Tard
operates its corporate stores under mainly the banners
Couche-Tard, Macs, Circle K, 7-jours, Dairy
Mart, Daisy Mart and Winks.
Couche-Tard sells its proprietary
branded food items such as La
Maisonnee and
Handful
fresh sandwiches and breakfast selections, as well as
Sloche
and Froster
brands of iced beverages. Circle K store brands include
Circle K, Circle K Express, The Frozen Zone, Thirst Buster, Polar Pop
and Freshest Coffee Going!.Service brands include: QuickFlick
and Circlek.com.
Tag lines include "What else
do you need". Couche-Tard
also sells motor fuel under its private labels, including
Couche-Tard, Macs, Circle K.
Couche-Tard is not dependent upon any single trademark or trade name, however,
it considers its banners and brands to be important assets. Accordingly,
Couche-Tards policy is to register or otherwise protect these intangible assets
in all jurisdictions in which Couche-Tard operates. Couche-Tard has exclusive
rights to use its trademarks, except in certain counties in Texas and Oklahoma
where Circle K has granted SSP Partners, one of its franchisees, the exclusive
right to use the Circle K
brand.

COMPETITION

Our stores compete with a number of national, regional, local
and independent retailers, including hypermarkets, grocery and supermarket
chains, grocery wholesalers and buying clubs, other convenience store chains,
oil company motor fuel/mini-convenience stores, food stores and fast food chains
as well as variety, drug and candy stores. In terms of motor fuel sales, our
stores compete with other food stores, service stations and, increasingly,
supermarket chains and discount retailers. Each stores ability to compete
depends on its location, accessibility and customer service. The rapid growth in
the numbers of convenience-type stores opened by oil companies and the entry of
a large number of hypermarkets into the industry over the past several years has
intensified competition. An increasing number of hypermarkets and other retail
format such as supermarkets and drugstores have been expanding their product mix
to include core convenience items and fill-in grocery. This channel blending is
eroding the convenience stores traditional base of business, as exemplified by
major drug store chains extending business hours to 24 hours a day, seven days a
week and selling a product assortment similar to that of convenience stores.

15

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ENVIRONMENTAL MATTERS

The Company is subject to various federal, state, provincial
and local environmental laws and regulations, including, in the United States,
the Resource Conservation and
Recovery Act of 1976, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
the Superfund Amendments and
Reauthorization Act of 1986 and
the Clean Air Act, in
each case as amended. The enforcement of these laws by regulatory agencies such
as the U.S. Environmental Protection Agency (the "EPA") and its state and
provincial equivalents will continue to affect our operations by imposing
increased operating and maintenance costs and capital expenditures required for
compliance. In addition, certain procedures required by these laws can result in
increased lead time and costs for new facilities. Violation of environmental
statutes, regulations or orders could result in civil or criminal enforcement
actions. The Company makes financial expenditures in order to comply with
regulations governing underground storage tanks adopted by federal, provincial,
state and local regulatory agencies.

In particular, at the U.S. federal level,
the Resource Conservation and
Recovery Act of 1976, as amended, requires the EPA to establish a
comprehensive regulatory program for the detection, prevention and cleanup of
releases from leaking underground storage tanks. Regulations enacted by the EPA
in 1988 established requirements for installing underground storage tank
systems, upgrading underground storage tank systems, taking corrective action in
response to releases, closing underground storage tank systems, keeping
appropriate records, and maintaining evidence of financial responsibility for
taking corrective action and compensating third parties for bodily injury and
property damage resulting from releases. These regulations permit states to
develop, administer and enforce their own regulatory programs, incorporating
requirements which are at least as stringent as the federal standards.

Our Canadian operations are also subject to environmental
regulation imposed by provincial, federal and municipal governments. This
primarily relates to the motor fuel operations conducted at approximately 513
locations throughout Canada, including the remediation of such products which
have spilled or leaked on or migrated from such locations and other locations
used in our earlier operations and those of our predecessors. We believe that we
are in material compliance with environmental laws in Canada, including such
regulation, and do not anticipate that any increase in the future costs of
maintaining compliance in Canada or of remediation of spills or leaks, including
any capital expenditure required, will be material to us. The Company is
currently dealing with a small number of claims by third parties or governmental
agencies for remediation or damages caused by contamination alleged to be on or
migrating from our current or historic operations. We do not anticipate any
material expense from such claims. However, changes in applicable requirements
and their enforcement or newly discovered conditions could cause us to incur
material costs that could adversely affect our business and results of
operations.

REGULATORY MATTERS

Many aspects of our operations are subject to regulation under federal,
provincial, state and local laws. We describe below the most significant of the
regulations that impact all aspects of our operations.

Safety.

Sale of Alcoholic Beverages and Tobacco Products.

16

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Store Operations.

Our operations are also subject to federal, provincial and
state laws governing such matters as wage rates, overtime, working conditions
and citizenship requirements. At the federal level, there are proposals under
consideration from time to time to increase minimum wage rates and to introduce
a system of mandated health insurance, which could affect our results of
operations.

RISK FACTORS

The "Business Risks" and "Other Risks" sections of our
"Managements Discussion and Analysis of Operating Results and Financial
Position" on pages 48 to 52 of the Companys 2006 Annual Report, is incorporated
herein by reference, as supplemented from time to time in the "Business Risks"
sections of our quarterly reports to shareholders.

DIVIDENDS

Since 1989, the Company had not declared any dividends but
effective since the second quarter of fiscal 2006, the Board of Directors has
implemented a quarterly dividend policy of 2.5 cents Cdn per Class A multiple
voting shares and Class B subordinate voting shares.

CAPITAL STRUCTURE

The voting shares of the Company are its Class A Multiple
Voting Shares (the "Multiple Voting Shares") and its Class B Subordinate Voting
Shares (the "Subordinate Voting Shares"). As at June 30, 2006, 56,388,652
Multiple Voting Shares and 145,651,434 Subordinate Voting Shares of the Company
were issued and outstanding. Each Multiple Voting Share carries 10 votes and
each Subordinate Voting Share carries one vote with respect to all matters
coming before the Meeting.

Conversion Rights

Each Multiple Voting Share is convertible at any time at the
holder's option into one fully paid and non-assessable Subordinate Voting Share.
Upon the earliest to occur of: (i) the day upon which all of the Majority
Holders (defined in the Articles of the Company as being Messrs. Alain Bouchard,
Richard Fortin, Réal Plourde and Jacques D'Amours) will have reached the age of
65, or (ii) the day when the Majority Holders hold, directly or indirectly,
collectively less than 50% of the voting rights attaching to all outstanding
voting shares of the Company, each Subordinate Voting Share shall be
automatically converted into one fully paid and non-assessable Multiple Voting
Share.

Take-Over Bid Protection

In the event that an offer as defined in the Articles of the
Company (an "Offer") is made to holders of Multiple Voting Shares, each
Subordinate Voting Share shall become convertible at the holder's option into
one Multiple Voting Share, for the sole purpose of allowing the holder to accept
the Offer. The term "Offer" is defined in the Articles of the Company as an
offer in respect of the Multiple Voting Shares which, if addressed to holders
resident in Québec, would constitute a take-over bid, a securities exchange bid
or an issuer bid under the Securities Act (Québec) (as presently in force or as it may be
subsequently amended or readopted), except that an Offer shall not include: (a)
an offer which is made at the same time for the same price and on the same terms
to all holders of Subordinate Voting Shares; and (b) an offer which, by reason
of an exemption or exemptions obtained under the
Securities Act (Québec),
does not have to be made to all holders of Multiple Voting Shares; provided
that, if the offer is made by a person other than a Majority Holder or by a
Majority Holder to a person other than a Majority Holder, in reliance on the
block purchase exemption set forth in section 123 of the
Securities Act (Québec),
the offer price does not exceed 115% of the lower of the average market price of
the Multiple Voting Shares and the average market price of the Subordinate
Voting Shares as established with the formula provided by the
Regulation Respecting Securities
(Québec). The conversion right attached to the Subordinate Voting Shares is
subject to the condition that if, on the expiry date of an Offer, any of the
Subordinate Voting Shares converted into Multiple Voting Shares are not taken up
and paid for, such Subordinate Voting Shares shall be deemed never to have been
so converted and to have always remained Subordinate Voting Shares. The Articles
of the Company contain provisions concerning the conversion procedure to be
followed in the event of an Offer.

17

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RATINGSOn November 18, 2003, Moodys Investors Service announced
that it rated the Companys Senior Subordinated Notes at Ba3. Such rating was
reviewed and upgraded in April 2006 to Ba2 pursuant to the operating and
financial progress that the Company has made since the December 2003 Circle K
acquisition. Obligations rated Ba are in the fifth highest category and are
judged to have speculative elements and are subject to substantial credit risk.
The November 2003 rating had been based upon potential post-Circle K merger
operating efficiencies from the Companys position as one of the leading
convenience store chain in North America, the Companys pattern after prior
acquisitions of reducing leverage with free cash flow and incremental equity
offerings, and expected growth in higher-margin merchandise categories.
Constraining the ratings are the integration risks in more than doubling the
Companys base with the Circle K acquisition, the expectation that fixed charge
coverage will remain fairly low for the next several years, and increase
reliance on unpredictable profits from gasoline sales.
On November 21, 2003, Standard and Poors Ratings Services
Limited announced that it had assigned a "B" rating to the Companys Senior
Subordinated Notes, with a stable outlook. Such rating was reviewed and
increased to "B+" in December 2005 to reflect the significant reduction in debt
undertaken by the company since the Circle K acquisition in December 2003,
coupled with operational improvement from its U.S. operations and ample
liquidity. Couche-Tard has exceeded its initial cost savings targets related to
the Circle K stores, where the company has begun to successfully implement its
Impact concepts store renovation program. An obligation rated "B" is more
vulnerable to non-payment than obligations rated "BB", but the obligor currently
has the capacity to meet its financial commitment on the obligation. Adverse
business, financial, or economic conditions will likely impair the obligors
capacity or willingness to meet its financial commitment on the obligation. The
rating reflects the relative large size of the Circle K acquisition, and the
resulting high leverage of the mostly debt funded acquisition. These factors are
partially offset by the Companys strong performing current store base, the
acquired store base that has performed reasonably well and a seasoned management
team that has experience with previous, even though smaller acquisitions.
A security rating is not a recommendation to buy, sell or
hold securities and may be subject to revision or withdrawal at any time by the
rating organization.MARKET FOR SECURITIES

The Multiple Voting Shares and Subordinate Voting Shares are
listed on the Toronto Stock Exchange since December 6, 1999 under the symbols
ATD.A and ATD.B, respectively.
Price Ranges and Volume Traded
Monthly
    Period
    Symbol
    High Price 1
    Low Price 1
    Traded VolumeApril 2005 2
    ATD.A
    $
    21.80
    $
    18.70
    76,060May 2005
    ATD.A
    $
    21.95
    $
    20.15
    26,884June 2005
    ATD.A
    $
    28.25
    $
    21.50
    136,12718
Monthly
    Period
    Symbol
    High Price 1
    Low Price 1
    Traded VolumeJuly 2005
    ATD.A
    $
    26.65
    $
    22.65
    23,145August 2005
    ATD.A
    $
    27.00
    $
    24.51
    22,318September 2005
    ATD.A
    $
    25.01
    $
    23.15
    23,856October 2005
    ATD.A
    $
    23.39
    $
    20.50
    20,579November 2005
    ATD.A
    $
    25.61
    $
    22.00
    24,798December 2005
    ATD.A
    $
    25.50
    $
    22.50
    748,257January 2006
    ATD.A
    $
    26.00
    $
    23.50
    43,899February 2006
    ATD.A
    $
    28.70
    $
    25.50
    28,532March 2006
    ATD.A
    $
    29.00
    $
    25.00
    71,033April 2006
    ATD.A
    $
    28.40
    $
    27.00
    512,388Monthly
    Period
    Symbol
    High Price 1
    Low Price 1
    Traded VolumeApril 2005 2
    ATD.B
    $
    18.00
    $
    16.51
    14,817,347May 2005
    ATD.B
    $
    18.11
    $
    15.91
    3,312,132June 2005
    ATD.B
    $
    19.45
    $
    18.00
    6,998,708July 2005
    ATD.B
    $
    21.58
    $
    18.71
    12,427,176August 2005
    ATD.B
    $
    21.75
    $
    19.86
    14,793,085September 2005
    ATD.B
    $
    20.86
    $
    19.54
    12,231,841October 2005
    ATD.B
    $
    21.67
    $
    19.80
    6,663,789November 2005
    ATD.B
    $
    23.66
    $
    20.97
    15,652,871December 2005
    ATD.B
    $
    23.67
    $
    22.10
    6,593,059January 2006
    ATD.B
    $
    24.23
    $
    22.68
    6,985,179February 2006
    ATD.B
    $
    25.94
    $
    23.46
    9,485,163March 2006
    ATD.B
    $
    26.93
    $
    21.49
    9,698,631April 2006
    ATD.B
    $
    27.83
    $
    25.40
    5,174,656Note:
  (1) All prices are in CAD$ an on a per share basis. 
  (2) From April 1 to 24, 2005 - average prices and total volumes for partial
  month.DIRECTORS AND SENIOR OFFICERSDirectorsThe following tables list the Companys directors. All information is
accurate as of June 30, 2006.Name and municipality of
    residence
    Principal occupationALAIN BOUCHARD 1
    Chairman of the Board, President
    and Chief Executive Officer of the CompanyLorraine, QuébecJACQUES DAMOURS
    1
    Vice-President,Lorraine, Québec
    Administration of
    the CompanyROGER DESROSIERS,
    FCA3
    Corporate DirectorMontréal, QuébecChairman of the
    Audit CommitteeJEAN ÉLIE2
    Corporate DirectorMontréal, Québec19
Name and municipality of
    residence
    Principal occupationRICHARD FORTIN 1
    Executive Vice-President and Chief
    Financial Officer of the CompanyLongueuil, QuébecJOSEE GOULET 3
    Corporate DirectorMontréal, QuébecROGER LONGPRÉ2, 3
    President, Mergerac
    Inc. (consulting firm in mergers and acquisitions)Brossard, QuébecChairman of the
    Human Resources andCorporate
    Governance CommitteeREAL PLOURDE 1
    Executive
    Vice-President and Chief Operating Officer of the CompanyMontréal, QuébecJEAN-PIERRE SAURIOL2
    President and Chief
    Executive Officer, Dessau-Soprin inc.Laval, Québec
    (engineering-
    construction company)JEAN TURMEL 4
    President, Perseus
    Capital Inc. (fund management company)Montréal, QuébecNotes:1)
  Member of the Executive Committee.
  
  2)
  Member of the Human Resources and Corporate Governance Committee. 
  3)
  Member of the Audit Committee. 
  4)Lead Director.

Each director remains in office until the following annual shareholders
meeting or until the election or appointment of his successor, unless he resigns
or his office becomes vacant as a result of his death, removal or any other
cause.

The Directors of the Company held the following principal occupations during
the five preceding years:

Alain Bouchard. He is the founder
of the companies that became Alimentation Couche-Tard Inc., which began with
just one store in 1980. He has more than 35 years of experience in the industry.
Mr. Bouchard began his career at Perrette Dairy Ltd. in 1968 as interim store
manager. He later became supervisor and district director until 1973. As
district director, he supervised the opening of 80 stores and developed the
Perrette network. From 1973 to 1976, while employed by Provigo Inc. (Provi-Soir
division), Mr. Bouchard organized and supervised the opening of 70 Provi-Soir
convenience stores. From 1976 to 1980, Mr. Bouchard operated a Provi-Soir
franchise and, in 1980, he opened the first Couche-Tard convenience store. Mr.
Bouchard is also a director of Quebecor Inc., a communications holding company
and Atrium Biotechnologies Inc. (development and marketing of cosmetic and
nutritional ingredients).

Richard Fortin. Before joining
Couche-Tard in 1984, he had more than 13 years of experience at a number of
major financial institutions, and was Vice-President of Quebec for a Canadian
bank wholly-owned by Societe Generale (France). Mr. Fortin holds a bachelor's
degree in Management with a major in Finance from Laval University in Quebec
City. Mr. Fortin is also a director of Transcontinental Inc., a commercial
printer and Insurance Life of National Bank of Canada.

Réal Plourde. Mr. Plourde joined
us in 1984 and has held various positions, ranging from Manager of Technical
Services to Vice-President of Development, Sales and Operations of the Company.
In 1988 and 1989, Mr. Plourde also acted as President of Pro Optic Inc., then a
wholly-owned subsidiary of Couche-Tard and Quebec's first optical lens
manufacturer. Mr. Plourde began his career in various engineering projects in
Canada and Africa. Mr. Plourde holds an Engineering Degree (Applied Sciences)
from Laval University in Quebec City and an MBA from the Ecole des Hautes Etudes
Commerciales in Montreal. Mr. Plourde is a member of the Quebec Engineers
Association. Mr. Plourde is also a director of Bouclair Inc., a fabric retailer.

Jacques D'Amours. Since joining
the Company in 1980, he has worked in a variety of roles, including Manager of
Technical Services, Vice-President of Sales and Vice-President of Administration
and Operations of the Company.

Jean A. Élie. From 1998 to 2002, Mr. Élie was
managing director of a Canadian bank wholly-owned by Societe Generale (France).
From 1987 to 1997, Mr. Élie was a director and member of the Executive Committee
and

20

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Josée Goulet.
Mrs. Goulet joined the Bell group of companies in 1985 and held various
management positions prior to being appointed to various senior management
positions since 1994 and held the position of Chief, Marketing Services, Bell
Canada when she left in May 2005. Mrs. Goulet graduated from the Ecole
Polytechnique of Montreal where she obtained a bachelor's degree in electrical
engineering and holds an MBA from McGill University in Montreal.

Roger Longpré

Jean Turmel

Jean-Pierre Sauriol

Roger Desrosiers

21

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Senior Officers

The following table lists the Companys senior officers who are not also
directors. All information is accurate as of June 30, 2006.

|Name and municipality of
    residence | Office held with the Company                           
|-------------------------------------- | -------------------------------------------------------
|                                       |                                                        
|MICHEL BERNARD                         | Vice-President,
    Operations Eastern Canada          
|Montreal, Quebec                       |                                                        
|                                       |                                                        
|ROBERT G. CAMPAU                       | Vice-President,
    Operations U.S. Southeast Region   
|Cave Creek ,Arizona                    |                                                        
|                                       |                                                        
|DARRELL DAVIS                          | Vice-President,
    Operations U.S. Midwest            
|Columbus, Indiana                      |                                                        
|                                       |                                                        
|STEPHANE GONTHIER                      | Senior
    Vice-President, Eastern North America       
|Laval, Quebec                          |                                                        
|                                       |                                                        
|MICHEL GUINARD                         | Vice-President,
    Development                        
|Laval, Quebec                          |                                                        
|                                       |                                                        
|BRIAN HANNASCH                         | Senior
    Vice-President, Western North America       
|Columbus Indiana                       |                                                        
|                                       |                                                        
|GEOFFREY C. HAXEL                      | Vice-President,
    Operations U.S. Arizona Region     
|Scottsdale, Arizona                    |                                                        
|                                       |                                                        
|JEAN-LUC MEUNIER                       | Vice-President,
    Operations Central Canada          
|Rosemère, Québec                       |                                                        
|                                       |                                                        
|CHARLES MICHAEL
    PARKER             | Vice-President,
    Operations U.S. Florida/Gulf Region
|Scottsdale ,
    Arizona               |                                                        
|                                       |                                                        
|JOY POWELL                             | Vice-President,
    Operations U.S. West Coast Region  
|Chino Hills,
    California            |                                                        
|                                       |                                                        
|KIM TROWBRIDGE                         | Vice-President,
    Operations Western Canada          
|Calgary, Alberta                       |                                                        

Michel Bernard has been
Vice-President, Operations Eastern Canada since December 2005 and previously
held the position of Vice-President, Operations U.S. Midwest since 2003. Mr.
Bernard has served in a variety of operations and marketing-related positions
during his 25-year supermarket and convenience store career. Mr. Bernard joined
Couche-Tard in 1987 and subsequently departed in 1994 to pursue other
opportunities including as Director of Convenience Retailing for Petro-Canada.
Mr. Bernard returned to Couche-Tard in 1999 as Senior Director of Marketing and
Merchandising. Mr. Bernard holds a bachelor's degree in Management, with a major
in Marketing, from the Universite du Quebec a Montreal.

Robert G. Campau has been
Vice-President, Operations U.S. Southeast Region since December 2003. Mr. Campau
began his nearly 30-year convenience industry career with the Southland
Corporation (7-Eleven) in 1974. Since joining Circle K in 1979, Mr. Campau held
a variety of positions including zone manager, division manager, director of
operations, franchise support services, director of organizational development,
director of operations and representative of the Office of the President. Prior
to December 2003, he served as Manager of Retail Support for ConocoPhillips. Mr.
Campau earned his bachelor's degree in business administration from the
University of Wisconsin at Madison.

Darrell Davis has been Vice-President, Operations
Midwest since December 2005.

22

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Stéphane Gonthierwas appointed Senior Vice-President, Operations Eastern North America in
December 2004 and was Vice-President, Operations, Central Canada from April 2004
to December 2005 and prior thereto, he was Vice-President, Operations Eastern
Canada and Secretary since 1999. In 1998, he joined us as Vice-President of
Legal Affairs, Petroleum Operations and Secretary. Before joining Couche-Tard,
he practised law. Mr. Gonthier holds an LL.B from the University of Montreal and
an MBA from the University of Sherbrooke and is a member of the Quebec Bar
Association.

Michael Guinard

Brian P. Hannasch

Geoffrey C. Haxel

Jean-Luc Meunier

Charles Michael Parker

Joy A. Powell

23

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Kim J. Trowbridge

As at June 30, 2006, the executive officers and directors, as
a group, beneficially owned, directly or indirectly, or exercised control or
direction over, 38,016,632 multiple voting shares and 2,072,208 subordinate
voting shares of the Company representing respectively 67.42% and 1.42% of the
issued and outstanding shares of the Company.

LEGAL PROCEEDINGS

In the ordinary course of business, Couche-Tard is a
defendant in a number of legal proceedings, suits, and claims common to
companies engaged in retail businesses. The majority of these cases are brought
by individual plaintiffs. Couche-Tard believes that it is not currently involved
in any litigation, claims or proceedings in which an adverse outcome would have
a material adverse effect on Couche-Tards operating results and financial
condition.

In the stock purchase agreement for all the outstanding capital stock of
Circle K, ConocoPhillips has agreed to indemnify us against all judgments
arising from legal proceedings filed and served on Circle K as of the closing
date.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the shares of the
Company is Computershare Trust Company of Canada, a/s National Bank Trust
Company, 1100 University Street, Suite 1200, Montreal, Quebec H3B 4L8. Registrar
offices are located in Toronto, Calgary and Vancouver.

MATERIAL CONTRACTS

Credit agreement

In connection with the Circle K acquisition, we refinanced
the majority of Couche-Tard's long-term debt. We entered into a senior credit
facility with a syndicate of lenders led by three Canadian chartered banks. The
senior credit facility is comprised of:

- five-year revolving credits facilities of up to an
  aggregate of approximately $120.0 million expiring in 2008;
- a non-renewable five-year Canadian Term Loan A facility
  which amounts to $19.5 million expiring in 2010; and
- a non-renewable seven-year U.S. Term Loan B facility which
  amounts to $147.0 million expiring in 2010.

Revolving Credit Facilities. We have a credit agreement
consisting of an operating credit in the amount of Cdn50 million, available in
Canadian or US dollars or as letters of guarantee not exceeding Cdn10 million or
the equivalent in US dollars, bearing interest at the Canadian or US prime rate,
depending of the case, or LIBOR, plus a certain margin depending on whether
certain financial ratios are achieved. The operating credit is also available in
the form of bankers' acceptances with stamping fees varying depending on whether
certain financial ratios are achieved. The credit agreement also provides for an
operating credit in the amount of 75 million available in US dollars and as
letters of guarantee not exceeding 30 million, bearing interest at the US prime
rate or at LIBOR plus a certain margin depending on whether certain financial
ratios are achieved.

Canadian Term Loan A Facility. We have a five-year Term
Loan a facility in the amount of an initial $265 million of which there is a
remaining outstanding balance of $19,5 million and which amortizes over the term
of the facility in quarterly instalments varying from 2.5% to 7.5% of the
principal amount. The facility bears interest at the Canadian base rate or
LIBOR, plus a certain margin varying on the basis of our leverage ratio.

U.S. Term Loan B Facility. In addition, we have a seven-year Term Loan B
facility denominated in U.S. dollars in an initial amount of $245 million of
which there is a remaining outstanding balance of $147 million and which
amortizes

24

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Prepayments.Our senior credit facility may be prepaid without premium or penalty at any
time. In addition, we may be required to prepay loans outstanding under the
senior credit facility, subject to certain limitations, by using:

- 100% of the net proceeds from the sale or issuance of
  certain debt or equity securities; and
- 100% of the net cash proceeds from certain asset sales
  (excluding sales of inventory in the ordinary course of business and certain
  specified dispositions), and insurance or condemnation proceeds, subject to
  certain reinvestment provisions.

Increase in Commitments.

Certain Covenants.

Events of Default

Trust Indenture

As part of our financing of the Circle K acquisition, we
issued $350 million 7 1/2 % Senior Subordinated Notes due 2013 (the
"Notes") under an Indenture (the "Indenture") with Wells Fargo Bank Minnesota,
N.A., as trustee (the "Trustee"). The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939,
as amended (the "TIA").

The indenture governing the Notes, among other things, (i)
restricts our ability and the ability of our subsidiaries to incur additional
debt, issue shares of preferred stock, incur liens, pay dividends or make
certain other restricted payments and enter into certain transactions with
affiliates; (ii) prohibits restrictions on the ability of our subsidiaries to
pay dividends should pre-determined criteria not be met or make certain payments
to us; and (iii) restricts our ability and the ability of our subsidiaries to
merge or consolidate with any other person or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of our assets. These
restrictions are subject to financial ratios that are reasonable and easily
reachable. The indenture related to the Notes also contains various covenants,
which limit our discretion in the operation of our businesses.

Circle K Sale and Leaseback Agreements

During March 2004, Circle K Stores Inc. sold a total of 322
properties to five investment companies, Fortress Investment Group controls two
of which and three of which are controlled by Realty Income Corporation. These
properties were immediately leased back by Circle K Stores Inc. pursuant to
leases having initial terms of between 15 and 17 years. The leases also include
options to extend the lease terms for five option terms of 5 years each, and two
additional option terms of 10 years each, for a maximum of 45 years following
the initial term. The performance of Circle K Stores Inc.s obligations as
tenant under each lease is guaranteed by the Company.

In addition, subject to certain conditions, each landlord can
sell a property and require Circle K Stores Inc. to enter into a new lease with
a subsequent purchaser, such lease being on essentially the same terms as the
lease with the selling landlord, and to execute certain documents relating to
the transfer of the applicable lease. Upon such a sale, the selling landlord may
also require the Company to execute a new guaranty of Circle K Stores Inc.'s
lease obligations in favour of the purchaser of the leased property.

25

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Shareholders Agreement

Following a review of the agreement amongst shareholders of
the Company intervened in December 1987, binding namely Développements Orano
Inc. ("Orano") and Metro Inc ("Metro") and in continuance with their former
relationship, they concluded a revised shareholders agreement on March 8, 2005
with respect to their participation in the Company. The rights and obligations
of the parties under that shareholders' agreement were principally as follows:

(i)   
Metro holds a pre-emptive right to participate in new issues of shares to
maintain its then existing equity ownership percentage of the Company;

(ii)  
Metro holds the right to nominate one person for election to the board of
directors of the Companyas long as it
holds at least 5% of all the outstanding shares of the Company on a fully
diluted basis; The representative currently designated by Metro on the board of
directors of the Company is Mr. Jean Élie who is not a Metro employee and not
related in anyway to Metro except for his position as director of the Company;

(iii)  
Metro and Orano have undertaken not to sell or transfer directly or indirectly
the shares of the Company held by them without the other partys prior written
consent;

(iv)  
Metro and Orano hold a reciprocal right of first opportunity on the sale or
transfer of shares held by them, subject to certain conditions; and

(v)  
Metro and Orano hold a reciprocal right of first refusal on the sale and
transfer of the shares of the Company held by them, subject to certain
exceptions for transfers to permitted assignees (including to any of Messrs.
Alain Bouchard, Richard Fortin and Jacques D'Amours).

This agreement provides that it will terminate if either
Metro or Orano holds less than 5% of the issued and outstanding shares of the
share-capital of the Company on a fully diluted basis.

AUDIT COMMITTEE DISCLOSURE

Charter

The Audit Committee assists the Board of Directors to
supervise: (1) the integrity of the Companys financial statements and related
information; (2) the Companys compliance with the applicable requirements
established by law and regulation; (3) the independence, the competence and the
appointment of the external auditors; (4) the performance of the head of the
corporate finance team of the Company with respect to the internal controls and
external auditors; and (5) Managements responsibility with regards to internal
controls.The Audit Committee has the following responsibilities with respect to
the reporting of financial information and the Chairman of the Committee reports
thereon to the Board of Directors:

1.    
Review, together with management and the external auditors, the annual financial
statements and the related notes, the external auditors report thereon and the
accompanying press release and obtain explanations from management on any
significant discrepancies with the corresponding periods before recommending
their approval by the board and publication.

2.    
Review, together with management, the quarterly financial statements and
accompanying press releases before recommending their approval by the board and
publication.

3.    
Review the financial information contained in the annual information form, the
financial information contained in the annual report, managements analysis of
the financial position and the operating results, and other documents containing
similar financial information before their disclosure to the public or filing
with Canadian and American regulatory authorities or other applicable
jurisdictions.

4.    
Review annually and supervise the Companys evaluation and risk management
policies. To that effect, the Committee ensures to receive a detailed report of
the assessed risks that could have a significant impact on the Companys
financial situation and actions taken thereon in order to eliminate or tone down
such risks.

26

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5.    
Review on an annual basis, together with management and the external auditors,
the quality and not just acceptability of the Companys new accounting policies
and review the disclosure and impact of contingencies and the reasonableness of
provisions, reserves and estimations which may have a material impact on the
reporting of financial information.

6.    
Review, together with the external auditors, the problems and difficulties in
connection with the audit and measures adopted in this regard by management and
find a solution to disagreements between management and the external auditors on
the reporting of financial information.

The Audit Committee has the following responsibilities with respect to risk
management and external controls:

1.    
Monitor the quality and integrity of the corporations internal control and
management information systems through discussions with management, the external
auditors and the head of the finance corporate team of the Company, where
applicable.

2.     Approve
the internal audit plan put in place by the head of the finance corporate team
of the Company

3.    
Oversee the reporting of information by management on internal control. Thus,
ensure that head of the finance corporate team of the Company reports biannually
to the Audit Committee the results of the work performed with respect to the
internal control systems.

4.    
Review on a regular basis an internal report describing the internal control
procedures, the material issues raised in the course of the latest reviews of
the internal control and management information systems, or pursuant to an
inquiry by government or professional authorities, as well as the
recommendations made and measures adopted with respect thereto.

5.     Assist
the board in discharging its responsibility for ensuring that the Company
complies with the applicable legal and regulatory requirements.

6.    
Establish procedures for the receipt, retention and treatment of complaints
received by the Company regarding accounting, internal accounting controls, or
auditing matters as well as procedures for the confidential, anonymous
submission by employees of the issuer of concerns regarding questionable
accounting or auditing matters.

The Audit Committee has the following responsibilities with respect to the
external auditors:

1.    
Review the written annual declaration of the external auditors concerning all
their connections with the Company and discuss the connections or services,
which may have an impact on their objectivity or ability to function
independently.

2.    
Recommend to the Board of Directors the appointment and, if necessary, the
non-renewal of the mandate (in both cases, subject to shareholder approval) of
the external auditors and review their competence, performance and ability to
function independently.

3.    
Approve all audit services for the Company and determine which services other
than audit services the auditors are not authorized to perform for the Company
or its subsidiaries. To that effect, the Committee may put in place policies and
procedures for prior detailed approvals concerning such services.

4.     May
delegate, if required to one or more independent members the authority to
pre-approve non-audit services subject that all such approvals be submitted at
the next Audit Committee meeting.

5.     Ensure
that the fees charged by the external auditors both for audit services and other
authorized services are reasonable and thereafter recommend to the Companys
Board of Directors the necessary approvals.

6.     Review
the audit plan with the external auditors and management and approve its
schedule.

7.    
Ensure that the Company complies with regulatory requirements with respect to
hiring partners, employees and former partners and employees of the present and
former external auditors of the Company. To that effect, the Committee must
pre-approve any hiring of current or former partners and employees of the
current or former external auditors.

8.     Ensure
that the external auditors always report to the Audit Committee and the board as
representatives of the shareholders.

27

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9.    
The Audit Committee always has direct lines of communication with the external
auditors and the responsible person of the internal auditing.

10.   
The Audit Committee holds separate meetings with management and the external
auditors at least once a year or more often as appropriate.

Composition of the Audit Committee

The Audit Committee is currently composed of three
independent directors, namely Messrs. Roger Desrosiers (Chairman), Roger Longpré
and Mrs. Josée Goulet.

Financial Literacy

Roger Desrosiers.

Roger Longpré

Josée Goulet.

28

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The Board of Directors of the Company has determined that
Messrs. Desrosiers, Longpré and Mrs. Goulet are "financially literate" in
accordance with Multilateral
Instrument 52-110 Audit Committees applicable in Canada. In addition,
it has determined that Mr. Desrosiers is an "audit committee financial expert"
in accordance with the U.S. Sarbanes-Oxley Act and the rules of the U.S. Securities and Exchange
Commission enacted there under.

Internal Controls

We maintain a system of internal controls over financial
reporting designed to safeguard assets and ensure that financial information is
reliable. We undertake ongoing evaluations of the effectiveness of internal
controls over financial reporting and implement control enhancements, when
appropriate. As at April 30, 2006, our management and our external auditors
reported that these internal controls were effective. By issuing this report at
that date, we have complied with legal and regulatory requirements prior to the
implementation date set for our Company by the Canadian and American regulatory
authorities.

We also maintain a system of disclosure controls and
procedures designed to ensure the reliability, completeness and timeliness of
the information we disclose in this MD&A and other public disclosure documents,
by taking into account materiality. Disclosure controls and procedures are
designed to ensure that information required to be disclosed by the Company in
reports filed with securities regulatory agencies is recorded and/or disclosed
on a timely basis, as required by law, and is accumulated and communicated to
the Companys management, including its Chief Executive Officer and its Chief
Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure.

Policy on the Approval of Non-audit Services

At its meeting held on March 16, 2004, the Audit Committee
adopted a policy and procedures on the pre-approval of non-audit services by the
Companys auditors. This policy prohibits the Company from engaging the auditors
to provide certain non-audit services to the Company and its subsidiaries,
including bookkeeping or other services related to the accounting records or
financial statements, financial information systems design and implementation,
appraisal or valuation services, actuarial services, internal audit services,
investment banking services, management functions or human resources functions,
legal services and expert services unrelated to the audit. The policy allows the
Company to engage the auditors to provide non-audit services, other than the
prohibited services, only if the services have specifically been pre-approved by
the Audit Committee.

29

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A copy of the policy and procedures on the pre-approval of
non-audit services by the Companys auditors may be obtained without charge by
contacting the Corporate Secretary at the head office of the Company, 1600
St-Martin Blvd. East, Tower B, Suite 200, Laval, Quebec H7G 4S7.

Code of Ethics for CEO, CFO and Senior Financial Officers

At its meeting held on March 15, 2004, the Audit Committee
approved a Code of ethics for the CEO, CFO and senior financial officers in
accordance with the U.S. SarbanesOxley Act ("SOX") and the applicable rules of the U.S.
Securities and Exchange Commission.

A copy of the Code of ethics for the CEO, CFO and senior
financial officers may be obtained without charge by contacting the Corporate
Secretary at the head office of the Company, 1600 St-Martin Blvd. East, Tower B,
Suite 200, Laval, Quebec H7G 4S7.

Whistle-Blowing Policy

During fiscal 2005, the Audit Committee approved in
accordance with the Canadian securities laws and with the U.S.
SarbanesOxley Act and
the applicable rules of the U.S. Securities and Exchange Commission a
whistle-blowing policy with respect to complaints on accounting and auditing
matters of the Company with the objective to:

- Establish procedures for the receipt, retention and
  treatment of complaints and/or concerns received regarding accounting,
  internal accounting controls or auditing matters;
- Establish procedures for the confidential, anonymous
  submission by employee of concerns regarding questionable accounting or
  auditing matters; and
- Establish mechanisms in order to ensure that no
  retaliations or punitive measures taken against an employee if the complaint
  was taken based on facts, in good faith and was not intended to cause
  prejudice to a person or in view of gaining any personal advantages.

Auditors Fees

Raymond Chabot Grant Thornton LLP, chartered accountants,
Montreal, have served as the Companys auditors since 1990. For the fiscal years
ended on April 30, 2006 and April 24, 2005, billed fees for audit,
audit-related, tax and all other services provided to the Company by Raymond
Chabot Grant Thornton LLP were as follows:

|                        | 2006            | 2005         
|----------------------- | --------------- | -------------
|Audit Fees1             | $
    916,920   | $
    895 256
|Audit-Related
    Fees2 | $
    118,620   | $
    55 984 
|Tax Fees3               | Nil             | Nil          
|All Other
    Fees      | Nil             | Nil          
|TOTAL                   | $
    1,035,540 | $
    951 240

Notes:

(1)  
Audit services are professional services rendered for the audit of an issuer's
annual financial statements and, if applicable, for the reviews of an issuer's
financial statements included in the issuer's quarterly reports and services
that are normally provided by the accountant in connection with an engagement to
audit the financial statements of an issuer - for example:

- attendance at audit committee meetings at which matters
  related to the audits or reviews are discussed;
- consultations on specific audit or accounting matters that
  arise during or as a result of an audit or review;
- preparation of a management letter;
- time incurred in connection with the audit of the income
  tax accrual; and
- services in connection with the issuer's annual and
  quarterly reports, prospectuses and other filings with Canadian, US or other
  securities commissions.

(2)  
Audit-related services (the Canadian term) are assurance and related services
traditionally performed by an independent auditor - for example:

- employee benefit
  plan audits;
- accounting work
  related to mergers and acquisitions, including special audits, due diligence
  and accounting consultations;
- internal control
  reviews;

30

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assurance engagements that are not required by statute or
  regulation; and - general advice on accounting standards.(3)   
This category includes tax services other than time incurred in connection with
the audit of the income tax accrual.

ADDITIONAL INFORMATION

The Company shall provide to any person, upon request to the
Secretary of the Company:

a)    
when the securities of the Company are in the course of a distribution pursuant
to a short form prospectus or a preliminary short form prospectus has been filed
in respect of a distribution of its securities:

i)     
one copy of the Company's annual information form, together with one copy of any
document, or the pertinent pages of any document, incorporated by reference in
the annual information form,

ii)    
one copy of the comparative financial statements of the Company for its most
recently completed financial year together with the accompanying report of the
auditor and one copy of any interim financial statements of the Company
subsequent to the financial statements for its most recently completed financial
year,

iii)   
one copy of the management proxy circular of the Company in respect of its most
recent annual meeting of shareholders that involved the election of directors,
and

iv)   
one copy of any other documents that are incorporated by reference into the
preliminary short form prospectus or the short form prospectus and are not
required to be provided under i) to iii) above; or

b)    
at any other time, one copy of any of the documents referred to in i), ii) and
iii) above, provided that the Company may require the payment of a reasonable
fee if the request is not made by a title holder of the Company.

Additional information, including officers and directors
remuneration and loans granted to them, if any, principal shareholders of the
Company, stock options and the interest of insiders in material transactions, if
any, is contained in the management proxy circular dated July 12, 2006 which was
prepared for the 2006 annual meeting of shareholders. Other financial
information is included in the audited consolidated financial statements and the
notes thereto for the fiscal year ended April 30, 2006 as well as Management's
Discussion and Analysis thereon. All such additional information relating to the
Company is available on SEDAR at www.sedar.com. The foregoing documents may be
obtained by contacting the Corporate Secretary at the head office of the
Company, 1600 St-Martin Blvd. East, Tower B, Suite 200, Laval, Quebec H7G 4S7.

* * * * *



31

---





|M | anagements Discussion
    and Analysis of Results
    and Financial Position
|- | -----------------------------------------------------------------------------



---

The purpose of this Managements Discussion and Analysis
(MD&A) is, as required by regulators, to explain managements point of view on
Alimentation Couche-Tard Inc.s (Couche-Tard) financial condition and results of
operations as well as past performance. More specifically, it outlines our
development strategy, performance in relation to objectives, future expectations
and how we address risk and manage our available financial resources. This MD&A
also provides information to improve the readers understanding of the
consolidated financial statements and related notes. It should therefore be read
in conjunction with those documents. By "we", "our", "us" and "the Company", we
refer collectively to Couche-Tard and its subsidiaries.
Except where otherwise indicated, all financial information
reflected herein is expressed in United States dollars (US dollars) and
determined on the basis of Canadian generally accepted accounting principles
(Canadian GAAP). You should read the following MD&A in conjunction with the
annual consolidated financial statements and related notes included in this 2006
Annual Report. Additional information relating to Couche-Tard, including the
Annual Information Form, is available on SEDAR at www.sedar.com and on the SECs
website at www.sec.gov.
Forward-Looking Statements
This MD&A includes certain statements that are "forward-looking statements"
within the meaning of the U.S. Private Securities Litigation Reform Act of
1995. Any statement in this MD&A that is not a statement of historical fact
may be deemed to be a forward-looking statement. When used in this MD&A, the
words "believe", "intend", "expect", "estimate" and other similar expressions
are generally intended to identify forward-looking statements.
It is important to know that the forward-looking statements
in this MD&A describe our expectations as at July 12, 2006 and are not
guarantees of future performance of Couche-Tard or its industry and involve
known and unknown risks and uncertainties which may cause the Companys or the
industrys outlook, actual results or performance to be materially different
from any future results or performance expressed or implied by such statements.
Our actual results could be materially different from what we expect if known or
unknown risks affect our business, or if our estimates or assumptions turn out
to be inaccurate. As a result, we cannot guarantee that any forward-looking
statement will materialize and, accordingly, you are cautioned not to place
undue reliance on these forward-looking statements. Forward-looking statements
do not take into account the effect that transactions or special items announced
or occurring after the statements are made may have on our business. For
example, they do not include the effect of sales of assets, monetizations,
mergers, acquisitions, other business combinations or transactions, asset
write-downs or other charges announced or occurring after forward-looking
statements are made.
Unless otherwise required by applicable securities laws, Couche-Tard
disclaims any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
The foregoing risks and uncertainties include the risks set forth below under
"Business Risks" as well as other risks detailed from time to time in reports
filed by Couche-Tard with securities regulators in Canada and the United States.
Change in Reporting Currency
Since our first quarter of fiscal 2006, we have reported our financial
results and financial position in US dollars and accordingly, our Canadian
assets and liabilities are translated into US dollars using the exchange rate in
effect at the balance sheet date. Revenues and expenses are translated at the
average rate in effect during the period. Gains and losses are included in the
Cumulative translation adjustments account in the Shareholders' equity. The
functional currency of the Company and the functional currencies of each of its
subsidiaries remain unchanged. All comparative amounts for prior periods have
been restated and are presented in US dollars.
Our Business
We are the leader in the Canadian convenience store industry. In North
America, we are the third largest convenience store operator and the second
largest independent convenience store operator (not integrated with a petroleum
company) and the most profitable public company within such category. We
currently operate a network of 4,983 convenience stores, 3,085 of which include
motor fuel dispensing, located in eight large geographic markets, including
three in Canada and five in the United States, covering 23 states. Some 37,000
people are employed throughout Couche-Tard's retail convenience network and
executive offices in North America.
We sell food and beverage items, motor fuel and other
products and services targeted to meet our customers' demand for convenience and
quality in a clean and welcoming environment. We believe that our business model
has differentiated Couche-Tard from its competition through its decentralized
management structure, commitment to operational expertise, focus on in-store
merchandise, particularly the higher growth and higher margin grocery
categories, and continued investment in store modernization and technology.

---

In light of improvements made to the Store 2000
differentiation concept in recent years through the addition of various
marketing and merchandizing approaches and components, we have renamed our
various concepts under one acronym  IMPACT (Innovation, Marketing and People at
Alimentation Couche-Tard). This acronym reflects not only the impact our
differentiation strategies have on our customers, sales and earnings but also
the diversity of the dynamic programs designed by the Couche-Tard teams in order
to create a unique, warm, friendly and inviting environment for customers.
We conduct our business through different modes of
operations. Although the majority of our stores are Company-operated, some are
part of our affiliate program, which includes franchised and licensed stores.
The amount of operating income generated from the affiliates amounted to $14.1
million or 4.3% of our total operating income for fiscal 2006, including $2.7
million or 1.0% of our total operating income generated by licensees outside
North America.
The convenience store industry is fragmented, with the top
ten operators representing only approximately 25% of the estimated total of
138,200 stores in the United States. Industry consolidation by highly leveraged
operators in the 1990's, combined with competition and fluctuations in motor
fuel margins, has led to numerous corporate restructurings and rationalizations
in recent years. As a result, we believe the opportunity exists for
well-capitalized, established industry participants to grow through mergers and
acquisitions.
2006 Overview
We announced record results for fiscal 2006, up 26.4% over last year to
$196.2 million or $0.94 per share on a diluted basis. This performance primarily
reflects growth in merchandise and service revenues and motor fuel revenues as
well as an increase in the corresponding gross margins in our Canadian and
American markets.
Excluding non-recurring items and items for which we have little or no
control, net earnings would have been $195.8 million(1) or $0.94 per
share on a diluted basis, an increase of 26.2% compared to last fiscal year.
Also, net earnings of the fourth quarter of 2006 amounted to
$32.1 million or $0.15 per share on a diluted basis, a decrease of 1.2%.
However, excluding the items mentioned above, net earnings would have been $36.7
million(1) or $0.18 per share on a diluted basis, which represents an
increase of 35.9 % compared with the net earnings of the fourth quarter of the
previous year (adjusted based on the annual effective income tax rate of 2005).
During the year, we experienced significant increases in the
retail price of motor fuel in our U.S markets, primarily attributable to the
volatility in the world prices for crude oil. The average retail price of motor
fuel in our U.S. markets amounted to $2.40 per gallon in fiscal 2006 compared
with $1.94 per gallon in fiscal 2005. The gross margin on motor fuel revenues
varies primarily as a result of product cost volatility and competition.
Although motor fuel gross margins can be volatile from one quarter to the next,
they generally even out on an annual basis. For each of our four quarters
commencing with the first quarter of fiscal 2006, motor fuel gross margins for
the Company-operated stores in the U.S. markets stood at 14.86¢, 17.05¢, 17.63¢
and 10.96¢ per gallon respectively - with a weighted average of 15.14¢ per
gallon for 2006 compared with 14.17¢ per gallon for the previous year. Net of
electronic payment modes related expense, these same gross margins were 11.88¢(2),
13.55¢(2), 14.39¢(2) and 7.65¢ per gallon, with a weighted
average of 11.88¢ per gallon in fiscal 2006, compared with 11.52¢ per gallon in
fiscal 2005. In fiscal 2006, this increase in the motor fuel gross margin had a
positive impact of $19.7 million on our operating income ($25.3 million
including Company-operated stores in Canada). Net of the increase in electronic
payment modes related expense, excluding volume effect, the positive impact is
reduced to $7.2 million ($11.6 million including Company-operated stores in
Canada).
Dividends
On November 15, 2005, the Companys Board of Directors adopted a quarterly
dividend policy of Cdn0.025$ per share on Class A multiple voting shares and
Class B subordinate voting shares (the shares). Following the adoption of this
dividend policy, the Board of Directors declared and approved quarterly
dividends of Cdn0.025$ per share for both second and third quarters of fiscal
2006. Subsequent to year end, the Board of Directors declared and approved a
quarterly dividend of Cdn0.025$ per share for the fourth quarter of fiscal 2006,
payable July 31, 2006.
(1)
    These adjusted net earnings are presented for information purposes only.
    They do not have a standardized meaning prescribed by Canadian GAAP.
    Management believes
    this information is a
    relevant complement to information published based on Canadian GAAP.(2)
    Restated
    following improvements in analysis and available data.2
Business acquisitions
During fiscal 2006, we made the following business acquisitions:

    effective
    March 14, 2006: purchase of 34 Company-operated stores and 19 affiliated
    stores, all operating under the Shell banner in the Indianapolis area of
    Indiana, United States, from Shell Oil Products US. At the closing date, two
    Company-operated stores were closed;
    effective
    December 14, 2005: purchase of 16 Company-operated stores operating under
    the Winners banner in New Mexico, United States, from Conway Oil Company and
    Conway Real Estate Company;
    effective
    December 8, 2005: purchase of 18 Company-operated stores and 8 affiliated
    stores, all operating under the BP banner in the Memphis area of Tennessee,
    United States, from BP Products North America, Inc.;
    effective November 3, 2005: purchase of seven Company-operated stores
    operating under the Fuel Mart banner in Ohio, United States, from Ports
    Petroleum Co.We expect those 73 new Company-operated stores and 27
affiliated stores to represent additional annual sales of approximately $341.0
million and to contribute to our net earnings on an annual basis.
These four acquisitions were carried out for a total cash
consideration of $91.6 million, financed using the Companys available cash. The
net assets acquired include $4.6 million in working capital, $81.4 million in
property and equipment, $2.0 million in trademarks and licences, $1.3 million in
other assets, $3.9 million in goodwill and $1.6 million in deferred credits and
other liabilities. Most of the goodwill related to the transactions is
deductible for tax purposes.Internal controlsWe confirm the effectiveness of our controls over financial
reporting as at April 30, 2006 thus conforming to legal and regulatory
requirements prior to the applicable implementation date set by Canadian and
American regulatory authorities.Franchises and licencesDuring fiscal 2006, we entered into an agreement with
ConocoPhillips Company resulting in the addition of 75 new franchises operating
under the Circle K banner in the Western United States, which will bring the
total to 251 franchises operated by ConocoPhillips Company and 672 franchises in
the entire North American network. Also during fiscal 2006, we decided not to
renew the agreement with the licence holder of 800 stores operated in Taiwan
under the Circle K banner since we did not agree on conditions of renewal.
Overall, the impact of these events on our financial position and operating
results will not be significant.

Hurricanes

Fiscal 2006

During 2006, Florida and the Gulf of Mexico region was
affected by three hurricanes, which resulted in some damages to certain of our
sites. We estimates that assets and leased properties that were damaged have a
total replacement value of approximately $16.7 million, which will result in a
net claim of about $13.0 million. The net book value of the damaged assets is
lower than the net claim. As at April 30, 2006, we have received $2.0 million in
insurance proceeds. We do not expect these hurricanes to have a significant
effect on our financial position and operating results.

In total, 163 sites were affected to various degrees, 15 of
which are still closed as of today. Of these sites, we expect that approximately
13 will remain permanently closed because they did not have the potential to
meet our contribution expectations, while the other two should reopen in fiscal
year 2008. As at April 30, 2006, and from the date of occurrence of those
events, we estimate that we have lost approximately 5,500 store-days.

As part of our risk management process, we have decided not
to renew our insurance coverage for material damage related to hurricanes. This
decision is based on the fact that the renewal conditions proposed by the
insurance companies were considered to be unacceptable from an economic
perspective. In fact, based on the proposals received, we would have had to
assume the majority of the risk. In addition, we believe that we have the
financial strength and available funds to absorb the risk. This decision will be
reviewed and re-evaluated on a regular basis in light of changing market
conditions.

3

---

Fiscal 2005
During 2005, certain areas of our business in Florida
experienced damages resulting from four hurricanes. Assets and leased properties
that were damaged have a total replacement value of $23.5 million, which
resulted in a net claim of about $16.6 million. The net book value of the
damaged assets is lower than the net claim. As at April 30, 2006, we have
received $15.9 million in insurance proceeds. We consider that these hurricanes
had no significant effect on our financial position and operating results.
In total, 92 sites were affected to various degrees, four of
which will remain permanently closed because they did not have the potential to
meet our contribution expectations. As at April 30, 2006, and from the date of
occurrence of those events, we estimate that we have lost approximately 4,800
store-days.
Subsequent events

Acquisitions
On June 12, 2006, we finalized the transaction with Spectrum
Holding, Inc. regarding the acquisition of 90 stores operating under the
Spectrum banner in the States of Georgia and Alabama in the United States. The
transaction was carried out for a cash consideration of $130.0 million, financed
using the Companys available cash. We expect that the 90 new stores will
represent additional annual revenues of approximately $325.0 million and that
they will contribute to our net earnings on an annual basis.
In addition, again on June 12, 2006, we signed an agreement
with Moore Oil Company, LLC in order to acquire a network of 24 stores operating
under the Stop-n-Save banner in the Monroe area of Louisiana in the U.S. Of the
24 stores, six are operated by the company, 17 are operated by independent store
operators and one store is currently under construction. If the transaction is
completed as expected in July 2006, we anticipate that these stores will
contribute to our operating income on an annual basis.
Income taxes
On June 9, 2006, the Government of Québec adopted Bill 15 in
the National Assembly of Québec regarding amendments to the Taxation Act and
other legislative provisions. As a result, an unusual retroactive income tax
expense of approximately $9.8 million, excluding other associated expenses, will
be recognized in the first quarter of fiscal 2007. This modification will not
have a significant impact on the effective income tax rate of the Company in the
future.
Outstanding shares and stock options
As at June 30, 2006, Couche-Tard had 56,388,652 Class A multiple voting
shares and 145,651,434 Class B subordinate voting shares issued and outstanding.
In addition, as at the same date, Couche-Tard had 9,307,980 outstanding stock
options for the purchase of Class B subordinate voting shares.
Income Statement Categories
Merchandise and Service Revenues. In-store merchandise revenues are
comprised primarily of the sale of tobacco products, grocery items, candy and
snacks, beverages, beer/wine and fresh food offerings, including quick service
restaurants (QSRs). Service revenues include the commission on sale of lottery
tickets and issuance of money orders, fees from automatic teller machines, sales
of calling cards and gift cards, fees for cashing cheques and sales of postage
stamps and bus tickets, as well as revenues from car washes. Service revenues
also include franchise fees, license fees from affiliates and royalties from
franchisees.
Motor Fuel Revenues. We include in our revenues the total
dollar amount of motor fuel sales, including any imbedded taxes, if we take
ownership of the motor fuel inventory. In the United States, we purchase motor
fuel and sell it to approximately 112 independent store operators at cost plus a
mark-up. We record the full value of these revenues (cost plus mark-up) as motor
fuel revenues. Where we act as a selling agent for a petroleum distributor, only
the commission we have earned is recorded as revenues. Gross profit from motor
fuel is derived by deducting the cost of the motor fuel from the motor fuel
revenues, except for commission stores where the gross profit is equal to the
recorded commission from the sale.
Gross Profit. Gross profit consists mainly of revenues
less the cost of goods and motor fuel sold. For in-store merchandise, the cost
of inventory is generally determined using the retail method (retail price less
a normal margin), and for motor fuel, it is determined using the average cost
method.

4

---

Operating, Selling, Administrative and General Expenses.
The primary components of operating, selling, administrative and general
expenses are labor, occupancy costs, commissions to dealers and overhead and
include advertising expenses that are charged as incurred.
Key performance indicators used by management, which can be
found under "Results of Operations-Other Operating Data", are merchandise and
service gross margin, growth of same-store merchandise revenues, motor fuel
gross margin and growth of same-store motor fuel volume.
Summary of Fourth Quarter Results: 13-Week Period Ended April 30, 2006
Compared to the 12-Week Period Ended April 24, 2005
The following table highlights certain information regarding the movement of our
stores during the 13-week period ended April 30, 2006:

|                                          | Company-operated | Affiliated | Total
|----------------------------------------- | ---------------- | ---------- | -----
|stores                                    | stores          
|Number
    of stores, beginning of period | 3,605            | 1,304      | 4,909
|Acquired                                  | 32               | 19         | 51   
|Opened                                    | 22               | 33         | 55   
|Closed                                    | (25)             | (7)        | (32) 
|Converted into affiliated stores          | (2)              | 2          | -    
|Number of stores, end of period           | 3,632            | 1,351      | 4,983

During the quarter, we also implemented our IMPACT program in
182 Company-operated stores for a total of 446 in 2006. As a result, 47.6% of
our Company-operated stores have now been converted to our IMPACT program, which
gives us considerable potential for future internal growth.

All of our Company-operated stores that were closed did not have the
potential to meet our contribution expectations. Most of these stores were part
of the Circle K network acquired December 17, 2003.

The following table highlights certain information regarding our operations
for the 13-week period ended April 30, 2006 and the 12-week period ended April
24, 2005:

|(In millions of US
    dollars, unless otherwise stated, unaudited)       | 13-week
    period | 12-week
    period
|------------------------------------------------------------------------- | ------------------ | ------------------
|                                                                          | ended              | ended             
|                                                                          | April 30, 2006     | April 24, 2005    
|Revenues                                                                  | 2,638.9            | 1,961.7           
|Operating income                                                          | 57.2               | 47.1              
|Net earnings                                                              | 32.1               | 32.5              
|Selected Operating
    Data:                                              |                    |                   
|Growth of same-store
    merchandise revenues on a 12-week basis (1) (2): |                    |                   
|Canada                                                                    | 4.3%               | 3.3%(3)           
|United States                                                             | 4.6%               | 6.6%(3)           
|Growth of same-store
    motor fuel volume on a 12-week basis (2):        |                    |                   
|Canada                                                                    | 4.1%               | 7.4%(3)           
|United States                                                             | 5.8%               | 4.5%(3)           

|    |                                                                                                                                                                                                                                                | 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|(1) | Excludes other revenues derived from
    franchise fees, royalties and rebates on some purchases by franchisees and
    licensees. (Growth in Canada is calculated based on Canadian dollars.)                                                
|(2) | Since our first quarter of fiscal
    2006, growth in both merchandise revenues and motor fuel volume has been
    reported on a same-store basis.                                                                                            
|(3) | For the comparative period, growth in
    merchandise revenues and motor fuel volume is reported on an average per
    store basis to be constant with our prior practices. Growth in the United
    States excludes the Circle K acquisition.

5

---

For the 13-week period ended April 30, 2006, we achieved
revenues of $2.64 billion, compared with $1.96 billion for the same
period in fiscal 2005, an increase of 34.5% or $677.2 million. We recorded 78.9%
of our revenues in the United States, compared with 77.7% in the fourth quarter
last year.
In the United States, growth of same-store merchandise
revenues (on a 12-week standardized basis) was 4.6 % while it was 4.3% in
Canada. In both the U.S. and Canada, this growth is partially due to the
results from investment in our IMPACT program conversions, as well as the
results from the launch of new products that were well received by customers and
from the implementation of our pricing strategies on certain product categories.
In Canada, the growth was negatively affected by growing smuggling on tobacco
products.
In the United States, the growth of same-store motor fuel
volume (on a 12-week standardized basis) was 5.8 % in the fourth quarter of
2006 while it was 4.1% in Canada, which reflects the positive impact, in
both the U.S. and Canada, of certain pricing strategies. Growth in Canada also
reflects the positive consumer response in Ontario to our rebranding of several
motor fuel locations, which now operate under Macs in addition to a strong
economy in Western Canada.
Net earnings stood at $32.1 million or $0.16 per share
($0.15 per share on a diluted basis), compared with $32.5 million or $0.16 per
share ($0.16 per share on a diluted basis), which represents a decrease of 1.2%.
By applying the annual effective tax rate in effect for 2005 (32.08%) to
earnings of the fourth quarter of 2005, the net earnings for this quarter would
have been $27.0 million or $0.13 per share on a diluted basis. In addition, net
earnings in the fourth quarter of 2006 were affected by the following items,
presented net of income tax:

|Net earnings for the 4th quarter of
    2006, as presented | Negative impact related to the
    increase in electronic payment modes related expense (1) | Negative impact related to
    non-recurring termination fees (2) | Negative impact related to the
    increase in the effective tax rate (3) | Positive impact related to changes in
    the exchange rate (4) | Positive impact related to the 13th
    week of the 4th quarter of 2006 | Net earnings for the fourth quarter of
    2006, adjusted (5)
|---------------------------------------------------------- | ------------------------------------------------------------------------------------------- | ----------------------------------------------------------------- | ------------------------------------------------------------------------- | --------------------------------------------------------------- | ----------------------------------------------------------------------- | -------------------------------------------------------------
|$32.1 million                                              | $4.0 million                                                                                | $3.3 million                                                      | $1.0 million                                                              | ($1.0) million                                                  | ($2.7) million                                                          | $36.7 million                                                

|    |                                                                                                                                                                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Related to the increase in the retail price and
    sales volume of motor fuel.                                                                                                                                                                                                                                                                                          
|(2) | Recognition of a non-recurring charge relating to
    penalties for the termination of two contracts governing the operation of
    automatic teller machines in some of our stores in the United States. The
    termination of these contracts will allow us to operate the automatic teller
    machines in these stores ourselves and to increase their contribution.
|(3) | Impact of the increase in the effective tax rate,
    which was 34.09% in the fourth quarter of this year compared with 32.08% for
    fiscal year 2005.                                                                                                                                                                                                                 
|(4) | Impact of the increase in the value of the
    Canadian dollar compared with the US dollar.                                                                                                                                                                                                                                                                              
|(5) | These adjusted net earnings are presented for
    information purposes only. They do not have a standardized meaning
    prescribed by Canadian GAAP. Management believes this information is a
    relevant complement to information published based on Canadian GAAP.                                                                                                 

Thus, by taking into account all of these factors for which
the nature is non-recurring or for which the Company has little or no control,
the net earnings for the fourth quarter of 2006 would have been $36.7 million
($0.18 per share on a diluted basis), which represents an increase of 35.9%
compared with the net earnings of the fourth quarter of the previous year
(adjusted based on the annual effective income tax rate of 2005).

Exchange Rate Data

The Companys US dollar reporting currency provides shareholders with more
relevant information giving consideration to the predominance of our operations
in the United States and our US dollar denominated debt.

The following table sets forth information about exchange rates based upon
the Bank of Canada closing rates expressed as US dollars per Cdn$1.00:

|                               | 53-week period ended | 52-week periods ended
|------------------------------ | -------------------- | ---------------------
|April 30, 2006                 | April 24, 2005       | April 25, 2004       
|Average for the
    period (1) | 0.8417               | 0.7779               
|Period end                     | 0.8945               | 0.8098               

|    |                                                                                                          | 
|--- | -------------------------------------------------------------------------------------------------------- | 
|(1) | Calculated by taking the average of the
    closing exchange rates of each day in the applicable period.

6

---

Selected Consolidated Financial Information

The following table highlights certain information regarding our operations
for the 53-week period ended April 30, 2006 and the 52-week periods ended April
24, 2005 and April 25, 2004:

|(In
    millions of US dollars, unless otherwise stated)                  | 53-week period
    ended | 52-week periods
    ended
|------------------------------------------------------------------------- | ------------------------ | -------------------------
|                                                                          | April 30, 2006           | April 24,2005            
|Statement of Operations Data:                                             |                          |                          
|Merchandise and service revenues (1):                                     |                          |                          
|Canada                                                                    | 1,426.7                  | 1,239.5                  
|United States                                                             | 2,812.0                  | 2,564.7                  
|Total merchandise and service revenues                                    | 4,238.7                  | 3,804.2                  
|Motor
    fuel revenues                                                   |                          |                          
|Canada                                                                    | 873.7                    | 664.8                    
|United States                                                             | 5,044.9                  | 3,567.8                  
|Total motor fuel revenues                                                 | 5,918.6                  | 4,232.6                  
|Total revenues                                                            | 10,157.3                 | 8,036.8                  
|Merchandise and service gross profit (1) :                                |                          |                          
|Canada                                                                    | 483.1                    | 415.7                    
|United States                                                             | 932.3                    | 834.9                    
|Total merchandise and service gross profit                                | 1,415.4                  | 1,250.6                  
|Motor
    fuel gross profit:                                              |                          |                          
|Canada                                                                    | 63.6                     | 51.3                     
|United States                                                             | 312.5                    | 255.9                    
|Total motor fuel gross profit                                             | 376.1                    | 307.2                    
|Total gross profit                                                        | 1,791.5                  | 1,557.8                  
|Operating, selling, administrative and general expenses                   | 1,352.9                  | 1,214.7                  
|Depreciation and amortization of property and equipment and other assets  | 106.9                    | 83.9                     
|Operating income                                                          | 331.7                    | 259.2                    
|Financial expenses                                                        | 34.0                     | 30.7                     
|Write-off of financing costs                                              | -                        | -                        
|Earnings before income taxes                                              | 297.7                    | 228.5                    
|Income
    taxes                                                          | 101.5                    | 73.3                     
|Net
    earnings                                                          | 196.2                    | 155.2                    
|Other Operating Data:                                                     |                          |                          
|Merchandise and service gross margin (1):                                 |                          |                          
|Consolidated                                                              | 33.4%                    | 32.9%                    
|Canada                                                                    | 33.9%                    | 33.5%                    
|United States                                                             | 33.2%                    | 32.6%                    
|Growth
    of same-store merchandise revenues on a 52-week basis (2) (5): |                          |                          
|Canada                                                                    | 3.9%                     | 2.6%(6)                  
|United States                                                             | 5.2%                     | 10.4%(6)                 
|Motor
    fuel gross margin:                                              |                          |                          
|Canada (Cdn cents per litre)                                              | 5.00                     | 4.61                     
|United States (cents per gallon) (3)                                      | 15.14                    | 14.17                    
|Volume
    of motor fuel sold (4) :                                       |                          |                          
|Canada (millions of litres)                                               | 1,509.6                  | 1,413.5                  
|United States (millions of gallons)                                       | 2,116.1                  | 1,858.1                  
|Growth
    of same-store motor fuel volume on a 52-week basis:            |                          |                          
|Canada                                                                    | 2.8%                     | 6.6%(6)                  
|United States                                                             | 6.0%                     | 6.3%(6)                  
|Per
    Share Data:                                                       |                          |                          
|Basic net earnings per share (dollars per share)                          | 0.97                     | 0.77                     
|Diluted net earnings per share (dollars per
    share)                    | 0.94                     | 0.75                     
|Dividends paid on common shares (Cdn dollars per
    share)               | 0.05                     | -                        
|Balance Sheet Data:                                                       |                          |                          
|Total assets                                                              | 2,369.2                  | 1,995.7                  
|Interest-bearing debt                                                     | 524.1                    | 530.9                    

|    |                                                                                                                                                                                                                                                  | 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | 
|(1) | Includes other revenues
    derived from franchise fees, royalties and rebates on some purchases by
    franchisees and licensees.                                                                                                              
|(2) | Does not include
    services and other revenues (as described in footnote 1). (Growth in Canada
    is calculated based on Canadian dollars.)                                                                                                  
|(3) | For Company-operated
    stores only.                                                                                                                                                                                                           
|(4) | Includes volume of
    franchisees and dealers.                                                                                                                                                                                                 
|(5) | Since our first quarter
    of fiscal 2006, growth in both merchandise revenues and motor fuel volume
    has been reported on a same-store basis.                                                                                              
|(6) | For both comparative
    periods, growth in merchandise revenues and motor fuel volume is reported on
    an average per store basis to be constant with our prior practices. Growth
    in the United States excludes the Circle K acquisition.

7

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53-Week Period Ended April 30, 2006 Compared to the 52-Week Period Ended
April 24, 2005

The following table highlights certain information regarding the movement of
our stores during the 53-week period ended April 30, 2006:

|                                       | Company-operated
    stores | Affiliated
    stores | Total
|-------------------------------------- | --------------------------- | --------------------- | -----
|Number of stores, beginning of period  | 3,581                       | 1,264                 | 4,845
|Acquired                               | 73                          | 27                    | 100  
|Opened                                 | 78                          | 119                   | 197  
|Closed                                 | (91)                        | (68)                  | (159)
|Converted into Company-operated stores | 1                           | (1)                   | -    
|Converted into affiliated stores       | (10)                        | 10                    | -    
|Number of stores, end of period        | 3,632                       | 1,351                 | 4,983

All of our Company-operated stores that were closed did not have the
potential to meet our contribution expectations. Most of these stores were part
of the Circle K network acquired December 17, 2003.

For the 53-week period ended April 30, 2006,

In the United States, growth of same-store merchandise
revenues (on a 52-week standardized basis) was 5.2% over the prior year
while it was 3.9% in Canada. In both the U.S. and Canada, this growth
reflects the results from investment in our IMPACT program conversions as well
as the efforts made by implementing new pricing strategies on certain product
categories and by modifying product mix. In the U.S., the increase in tobacco
tax in some regions also contributed to the growth while in Canada, growing
smuggling on tobacco products had a negative impact.

In the United States, the growth of same-store motor fuel
volume (on a 52-week standardized basis) was 6.0% while it was 2.8% in
Canada. The growth in the U.S. in part reflects the positive impact of
certain pricing strategies, partially offset by the shortage of motor fuel in
certain regions in the second and third quarters of 2006 due to the hurricanes.
In addition, in both the U.S. and Canada, growth was negatively affected by
pressure on consumer spending caused by the sharp increase in retail pump
prices.

Gross profit grew by 15.0% or $233.7 million to $1.79
billion, compared with $1.56 billion for the previous year. This increase is
mainly due to higher sales overall and higher margins on merchandise and service
revenues and on motor fuel revenues in both Canada and the U.S.

| | The
    consolidated merchandise and service gross margin was 33.4%, up from
    32.9% in the previous fiscal year. The gross margin in the U.Swas
    33.2%, up from 32.6% in the previous year. In Canada, it was 33.9%
    compared with 33.5% for fiscal 2005. In both our Canadian and U.S. markets,
    the impact of improvements in purchasing terms, changes in product mix with
    a focus on higher margin items, the launch of new products that were well
    received by customers and that generated higher margins, as well as the
    implementation of our IMPACT program in an increasing number of our stores
    are behind the increase in gross margin. However, the increase in gross
    margin in the United States and Canada was also affected by our pricing
    strategies on certain product categories designed to increase volume.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The
    motor fuel gross margin increased to 15.14¢ per gallon in the United
    Statesfrom 14.17¢ per gallon in the previous year, whereas in Canada,
    it also increased, reaching Cdn5.00¢ per litre compared with Cdn4.61¢ per
    litre in the previous year. These increases primarily reflect the volatile
    nature of the motor fuel business, partially offset by our selective pricing
    strategies implemented in certain areas of the U.S. to increase sales volume
    and by strong competition in some regions.                                                                                                                                                                                                                                                                                                                                

Operating, selling, administrative and general expenses
increased by $138.2 million or 11.4% over the previous fiscal year. This
includes an increase of $20.8 million in electronic payment modes related
expense, which relates to the increase in the retail price of motor fuel. As a
percentage of merchandise and service revenues, operating, selling,
administrative and general expenses remained unchanged despite the recognition
of a non-recurring charge of $5.0 million relating to the termination of certain
contracts governing the operation of automatic teller machines in some of our
stores in the United States. Not including this non-recurring charge, operating,
selling, administrative and general expenses would have decreased by 0.1% as a percentage of merchandise and
service revenues, reflecting the effectiveness of our operating model.

8

---

Depreciation and amortization of property and equipment and other assets
increased by 27.4% to $106.9 million in fiscal 2006. This increase is due mainly
to the impact of the capital expenditures made during fiscal 2005 and 2006.
Operating income of $331.7 million for
fiscal 2006 increased by 28.0%, or $72.5 million, over the $259.2 million earned
in the previous fiscal year.
Financial expenses of $34.0
million were up by $3.3 million or 10.7% over last year due to a general
increase in interest rates. The average interest rate applied to our borrowings
rose to 7.0% compared with 5.2% for fiscal 2005. Interest rate swaps entered
into in March 2004 increased financial expenses by $1.3 million compared with a
decrease of $5.6 million for fiscal 2005. In addition, financial expenses were
reduced by $8.1 million of interest income earned from the investing of excess
cash compared with $2.2 million in the previous year.
Income taxes increased by
$28.2 million or 38.5%, to $101.5 million, primarily due to increased pre-tax
earnings. The increase in the effective income tax rate by approximately 2.0% is
attributable to changes made to the apportionment of taxable income among the
various jurisdictions that have different income tax rates.
Net earnings increased by
$41.0 million or 26.4%, to $196.2 million or $0.97 per share ($0.94 per share on
a diluted basis), compared with $155.2 million or $0.77 per share ($0.75 per
share on a diluted basis) in the previous year. Net earnings for 2006 were
affected by the following items, presented net of income tax:

|Net earnings for 2006, as presented | Negative impact related to the increase in
    electronic payment modes related expense(1) | Negativeimpact related to non-recurring
    termination fees (2) | Positive impact related to the increase in
    motor fuel margins (3) | Negativeimpact related to the increase in the
    effective tax rate (4) | Positive impact related to changes in the
    exchange rate (5) | Positive impact related to the 53rd
    week of 2006 | Net earnings for 2006, adjusted
    (6)
|----------------------------------- | ------------------------------------------------------------------------------------------ | ---------------------------------------------------------------- | --------------------------------------------------------------------- | ------------------------------------------------------------------------ | --------------------------------------------------------------- | ---------------------------------------------------- | ---------------------------------------
|$196.2
    million                  | $13.7
    million                                                                          | $3.3 million                                                     | ($16.7)
    million                                                   | $6.0
    million                                                         | ($4.0)
    million                                              | ($2.7) million                                       | $195.8 million                         

> (1) Related to the increase in the retail price and sales
>   volume of motor fuel. 
>   (2) Recognition of a non-recurring charge relating to penalties for the
>   termination of certain contracts governing the operation of automatic teller
>   machines in some of our stores in the United States. 
>   (3) Increase in the motor fuel gross margins for our Company-operated stores.
>   
>   (4) Impact of the increase in the effective tax rate, which was 34.09% for
>   this year compared with 32.08% for fiscal year 2005. 
>   (5) Impact of the increase in the value of the Canadian dollar compared with
>   the American dollar. 
>   (6) These adjusted net earnings are presented for information purposes only.
>   They do not have a standardized meaning prescribed by Canadian GAAP.
>   Management believes this information is a relevant complement to information
>   published based on Canadian GAAP.

Thus, by taking into account all of these factors for which
the nature is non-recurring or for which the Company has little or no control,
the net earnings for 2006 would have been $195.8 million ($0.94 per share on a
diluted basis), which represents an increase of 26.2% compared with the net
earnings for the previous year.

Financial Position as at April 30, 2006

Our total consolidated assets of $2.37 billion as at April
30, 2006 increased by $373.5 million compared with the previous year. The
following items primarily represent the change:

- an increase of $202.1 million in property and equipment
  attributable to capital investments in 2006;
- an increase of $78.8 million in cash and cash equivalents,
  which amounted to $331.5 million as at April 30, 2006;
- an increase of $26.6 million in credit and debit card
  receivables generated mostly by higher motor fuel revenues;
- an increase of $21.2 million in motor fuel inventory
  attributable to higher crude oil prices on the global market.

9

---

Shareholders equity of $966.0 million as at April 30, 2006
increased by $232.8 million resulting mainly from net earnings of $196.2 million
in addition to the increase in cumulative translation adjustments for fiscal
2006. The increase in cumulative translation adjustments was generated by
significant exchange rate fluctuations. The net interest-bearing debt to total
capitalization ratio stood at 0.17:1 (1) versus 0.28:1 as at April
24, 2005.



Liquidity and Capital Resources

Our principal source of liquidity is net cash provided by
operating activities. Our principal uses of cash are to finance our capital
expenditures, carry out acquisitions, pay dividends, meet debt service
requirements, and provide for working capital. We expect that cash available
from operations together with borrowings available under our revolving credit
facilities as well as potential sale and leaseback transactions will be adequate
to meet our liquidity needs in the foreseeable future.

As at April 30, 2006, our total debt was $524.1 million (of
which $350.0 million consisted of 7.5% Subordinated unsecured debt maturing in
2013, $166.5 million consisted of borrowings under our Secured term loans and
$7.6 million consisted of other long-term debt).

In addition to the above, we have interest rate swap
agreements with three banks under which we pay interest on $350.0 million at a
rate of LIBOR plus an aggregate weighted average rate factor of 2.95%. The
interest rate is reset every six months over the term of the agreements. The
swap agreements, which expire on December 15, 2013, provide that, after December
15, 2008, each bank has the right to terminate its arrangement with the payment
of a termination fee if terminated before December 15, 2011 and, if terminated
after that date, without payment of a termination fee. In addition, both parties
to each agreement have a mutual right to terminate the arrangement on the fifth
anniversary date of the effective date of each of the three agreements. If such
right was exercised by either party, that party would be required to pay the
other party the mark to market value of the interest rate swap. We formally
document and designate each derivative financial instrument as a hedge of our
Subordinated unsecured debt. We determine that derivative financial instruments
are effective hedges, at the time of the establishment of the hedge and for the
duration of the instrument, since the date to maturity, the reference amount and
interest rate of the instruments correspond to all the conditions of the debt.

_____________________________

10

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Credit Facilities.

Virtually all of our assets secure our senior credit
facility. We must meet certain commitments and achieve certain financial ratios
under the credit agreement. In addition, the credit agreement imposes certain
restrictions on business acquisitions, dividend payments and, if a certain ratio
is not achieved, capital spending. As well, the indenture governing the
subordinated debt also contains certain restrictions on business acquisitions
and the payment of dividends. Compliance with the ratios, commitments and
restrictions described above is tested at the end of each quarter. As at April
30, 2006, the Company was in compliance with all of these covenants.

Net Cash Provided by Operating Activities.

Net Cash Used in Investing Activities.

Net Cash Used by Financing Activities.

Contractual Obligations and Commercial Commitments

Set out below is a summary of our material contractual cash obligations as of
April 30, 2006:

|                            | 2007                        | 2008  | 2009  | 2010  | 2011  | Thereafter | Total  
|--------------------------- | --------------------------- | ----- | ----- | ----- | ----- | ---------- | -------
|                            | (in millions of US dollars)
|Long-term debt              | 7.6                         | 8.2   | 8.9   | 1.9   | 141.3 | 353.9      | 521.8  
|Capital lease obligations   | 0.8                         | 0.6   | 0.5   | 0.4   | 0.4   | 1.7        | 4.4    
|Operating lease obligations | 159.6                       | 142.3 | 119.4 | 106.0 | 93.1  | 748.7      | 1,369.1
|Purchase commitments        | 3.5                         | 0.5   | 1.3   | 0.6   | 0.6   | 1.3        | 7.8    
|Total                       | 171.5                       | 151.6 | 130.1 | 108.9 | 235.4 | 1,105.6    | 1,903.1

Business Acquisition.

__________________________

11

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Long-Term Debt.



Capital Lease Obligations.

Operating Lease Obligations.

Contingencies.

We are covered by insurance policies that have significant
deductibles. At this time, we believe that we are adequately covered through the
combination of insurance policies and self-insurance. Future losses which exceed
insurance policy limits or, under adverse interpretations, are excluded from
coverage would have to be paid out of general corporate funds. In association
with our workers' compensation policies, we issue letters of credit as
collateral for certain policies.

We also issue surety bonds for a variety of business
purposes, including bonds for taxes, lottery sales, wholesale distribution and
alcoholic beverage sales. In most cases, the surety bonds are required by a
municipality or state governmental agency as a condition of operating a store in
that area.

Off-Balance Sheets Arrangements

In the normal course of business, we finance certain of our
activities off-balance sheets through operating leases for properties on which
we conduct our retail business. The future commitments are included under
"Operating Lease Obligations" in the table above.

_____________________

12

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Selected Quarterly Financial Information (Unaudited)

The Companys 52-week reporting cycle is divided into four
quarters of 12 weeks each except for the third quarter, which comprises 16
weeks. When a fiscal year, such as 2006, contains 53 weeks, the fourth quarter
comprises 13 weeks. The following is a summary of selected consolidated
financial information derived from the Companys unaudited interim consolidated
financial statements for each of the eight most recently completed quarters.
This information was prepared in accordance with Canadian GAAP and is reported
in US dollars.

|(In millions of US dollars
    except for per share data, unaudited) | 53 weeks ended April 30, 2006 | 52 weeks ended April 24, 2005
|-------------------------------------------------------------------- | ----------------------------- | -----------------------------
|Quarter                                                              | 4th                           | 3rd                          
|Weeks                                                                | 13 weeks                      | 16 weeks                     
|                                                                     |                               |                              
|Revenues                                                             | 2,638.9                       | 2,944.2                      
|Income before depreciation
    and                                   |                               |                              
|amortization of property and equipment                               |                               |                              
|and other assets, financial expenses and                             |                               |                              
|income taxes                                                         | 84.0                          | 128.2                        
|Depreciation and amortization
    of property                        |                               |                              
|and equipment and other assets                                       | 26.8                          | 33.4                         
|Operating income                                                     | 57.2                          | 94.8                         
|Financial expenses                                                   | 8.5                           | 10.8                         
|Net earnings                                                         | 32.1                          | 54.5                         
|Net earnings per share                                               |                               |                              
|Basic                                                                | $0.16                         | $0.27                        
|Diluted                                                              | $0.15                         | $0.26                        

The influences of the volatility of motor fuel gross margin
and seasonality have an impact on the variability of our quarterly net earnings.
Since the acquisition of Circle K, motor fuel revenues have become a more
significant segment of our business and therefore our results are more sensitive
to the volatility of motor fuel gross margins.

52-Week Period Ended April 24, 2005 Compared to the 52-Week Period Ended
April 25, 2004

During the 52-week period ended April 24, 2005, we completed
three small business acquisitions for a total of 49 stores, opened 44 QSRs and
implemented our IMPACT program in 223 stores, including 54 new stores.

For the 52-week period ended April 24, 2005,
we achieved revenues of $8.04 billion, compared with $4.40 billion in
fiscal 2004, a major increase of 82.8% or $3.64 billion of which $3.37 billion
come from the U.S., reflecting primarily the contribution of $3.02 billion in
revenue from Circle K and the internal growth in the U.S. network. We recorded
76.3% of our revenues in the United States, compared with 62.7% in the previous
fiscal year.

In the U.S., growth of average merchandise revenues per store
(excluding Circle K for comparative purposes) was 10.4% over the prior year,
while it was 2.6% in Canada. The growth in the U.S. reflects efforts made
to increase revenues by optimizing product mix, as well as the influence from
investment in our IMPACT program conversions (formerly Store 2000) and the
increase in tobacco tax. Growth in Canada reflects the aggressive pricing on
generic tobacco and certain dairy categories.

In the U.S., growth of average motor fuel volume per store
(excluding Circle K) was 6.3% over the prior year, while it was 6.6% in
Canada. In the U.S., the growth reflects the positive consumer response to
our rebranding of several motor fuel locations to nationally recognized brands
whereas in Canada, the growth reflects certain pricing strategies. In both
markets, the implementation of our IMPACT program (formerly Store 2000) in our
stores also had a positive impact on growth. Gross profit grew by 70.3%
or $643.3 million to $1.56 billion, compared with $914.5 million for the
previous year. This increase is mainly due to higher revenues, particularly
additional sales from Circle K and higher motor fuel gross margins, in
particular from Circle K.

- 

13

---



Operating, selling, administrative and general expenses

Depreciation and amortization of property and equipment

Operating income

Financial expenses

Income taxes

Net earnings

Net earnings for fiscal 2005 were affected by the following
items, which are presented on an after-tax basis:

- the additional electronic payment modes related expense in
  our U.S. markets (primarily resulting from higher motor fuel retail prices)
  amounting to approximately $11.5 million ($0.06 per share on a diluted basis).
  Including Canada, electronic payment modes related expense increased by
  approximately $12.1 ($0.06 per share on a diluted basis);
- the expense of $2.4 million ($0.01 per share on a diluted
  basis) related to the amended stock-based compensation accounting policy
  adopted retroactively this year without restatement of prior years earnings.

Internal Controls

We maintain a system of internal controls over financial
reporting designed to safeguard assets and ensure that financial information is
reliable. We undertake ongoing evaluations of the effectiveness of internal
controls over financial reporting and implement control enhancements, when
appropriate. As at April 30, 2006, our management and our external auditors
reported that these internal controls were effective. By issuing this report at
that date, we have complied with legal and regulatory requirements prior to the
implementation date set for our Company by the Canadian and American regulatory
authorities.

We also maintain a system of disclosure controls and
procedures designed to ensure the reliability, completeness and timeliness of
the information we disclose in this MD&A and other public disclosure documents,
by taking into account materiality. Disclosure controls and procedures are
designed to ensure that information required to be disclosed by the Company in
reports filed with securities regulatory agencies is recorded and/or disclosed
on a timely basis, as required by law, and is accumulated and communicated to
the Companys management, including its Chief Executive Officer and its Chief
Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure.

14

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Critical Accounting Policies and Estimates

Estimates. This MD&A is based on Couche-Tard's
consolidated financial statements, which have been prepared in accordance with
Canadian GAAP. These principles require us to make certain estimates and
assumptions that affect our financial position and results of operations as
reflected in our financial statements. These assumptions and estimates are based
on past events and expectations of future outcomes. On an ongoing basis,
management reviews its estimates, including those relating to supplier rebates,
environmental costs and asset retirement obligations based on available
information. These estimates are based on management's best knowledge of current
events and actions that the Company may undertake in the future. Actual results
may differ from the estimates.

Inventory. Our inventory is comprised mainly of products
purchased for resale including grocery items, tobacco products, packaged and
fresh food products, motor fuel and lottery tickets. Inventories are valued at
the lesser of cost and net realizable value. Cost is generally determined by the
retail method for in-store merchandise, the average cost method for motor fuel
inventory and first-in first-out for distribution centres. Inherent in the
determination of gross profit margins are certain management judgments and
estimates, which could affect ending inventory valuations and results of
operations.

Impairment of Long-lived Assets. We evaluate long-lived
assets other than goodwill for indicators of impairment whenever events or
changes in circumstances indicate their carrying value may not be recoverable.
Managements judgments regarding the existence of impairment indicators are
based on market conditions and operational performance. The variability of these
factors depends on a number of conditions, including uncertainty about future
events. These factors could cause us to conclude that impairment indicators
exist and require that impairment tests be performed, which could result in
determining that the value of certain long-lived assets is impaired, resulting
in a write-down of such long-lived assets.

Goodwill, Trademarks and Licences are evaluated for
impairment annually, or more often if events or changes in circumstances
indicate that the value of certain goodwill, trademarks or licences may be
impaired. For the purpose of this impairment test, management uses estimates and
assumptions to establish the fair value of its reporting units and intangible
assets. If these assumptions and estimates prove to be incorrect, the carrying
value of our goodwill, trademarks or licenses may be overstated. Our annual
impairment test is performed in the first quarter of each fiscal year.

Environmental Matters. We provide for estimated future
site remediation costs to meet government standards for known site contamination
when such costs can be reasonably estimated. Estimates of the anticipated future
costs for remediation activities at such sites are based on our prior experience
with remediation sites and consideration of other factors such as the condition
of the site contamination, location of sites and experience with contractors
that perform the environmental assessments and remediation work.

In each of the U.S. states in which we operate, except
Michigan, Iowa, Florida, Texas and Washington State, there is a state fund to
cover the cost of certain rehabilitation and removing of motor fuel tanks. These
state funds provide insurance for motor fuel facilities operations to cover the
cost of cleaning up contamination to the environment caused by the usage of
underground motor fuel equipment. Underground motor fuel storage tank
registration fees and a motor fuel tax in each of the states finance the trust
funds. We pay the registration fees and remit the sales taxes to the states
where we are a member of the trust fund. Insurance coverage is different in the
various states.

Should the estimated future remediation expenditures or state reimbursement
amounts change, it could have a material adverse effect on the financial
condition and results of operations.

Income Taxes. Future income tax assets and liabilities
are recognized for the future income tax consequences attributable to temporary
differences between the financial statement carrying values of assets and
liabilities and their respective income tax bases. Future income tax assets or
liabilities are measured using enacted or substantively enacted income tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The calculation of current
and future income taxes requires management to make estimates and assumptions
and to exercise a certain amount of judgment regarding the financial statement
carrying values of assets and liabilities which are subject to accounting
estimates inherent in those balances, the interpretation of income tax
legislation across various jurisdictions, expectations about future operating
results and the timing of reversal of temporary differences and possible audits
of tax fillings by the regulatory authorities. Management believes it has
adequately provided for income taxes based on current available information.

Changes or differences in these estimates or assumptions may
result in changes to the current or future income tax balances on the
consolidated balance sheets, a charge or credit to income tax expense in the
consolidated statement of earnings and may result in cash payments or receipts.

15

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Insurance and Workers' Compensation. We use a combination
of insurance, self-insured retention, and self-insurance for a number of risks
including workers' compensation (in certain states), property damage, and
general liability claims. Accruals for loss incidences are made based on our
claims experience and actuarial assumptions followed in the insurance industry.
A material revision to our liability could result from a significant change to
our claims experience or the actuarial assumptions of our insurers. Actual
losses could differ from accrued amounts. Workers' compensation is covered by
government-imposed insurance in Canada and by third-party insurance in our
United States operations, except in certain states where we are self-insured.
With respect to the third-party insurance in the United States, independent
actuarial estimates of the aggregate liabilities for claims incurred serve as a
basis for our share of workers' compensation losses.

Accounting Changes

Non-monetary transactions

On June 1, 2005, the Canadian Institute of Chartered
Accountants (CICA) issued Handbook Section 3831, "Non-Monetary Transactions",
replacing Section 3830 of the same name. Under these new standards, all
non-monetary transactions initiated in periods beginning on or after January 1,
2006 have to be measured at fair value unless:

- the transaction lacks commercial substance;
- the transaction is an exchange of a product or property
  held for sale in the ordinary course of business for a product or property to
  be sold in the same line of business to facilitate sales to customers other
  than the parties to the exchange;
- neither the fair value of the assets received nor the fair
  value of the asset given up is reliably measurable; or
- the transaction is a non-monetary, non-reciprocal transfer
  to owners that represents a spin-off or other form of restructuring or
  liquidation.

We adopted these new recommendations both early and
prospectively on July 18, 2005. The implementation of these new recommendations
did not have any impact on our financial statements.

Recently Issued Accounting Standards

On January 27, 2005, the CICA Accounting Standards Board (AcSB)
issued Section 1530, "Comprehensive Income", Section 3855, "Financial
Instruments  Recognition and Measurement" and Section 3865, "Hedges". These new
sections are effective for interim and annual periods beginning after October 1,
2006 and provide comprehensive requirements for the recognition and measurement
of financial instruments, as well as standards on when and how hedge accounting
may be applied. Additionally, these sections introduce a new component of equity
referred to as comprehensive income.

Section 1530 requires companies to disclose comprehensive
income, which includes, in addition to net income, comprehensive income
consisting primarily of unrealized gains and losses that bypass the traditional
earnings statement and are recorded directly into shareholders equity. The
components of other comprehensive income consist of unrealized gains and losses
related to the translation of foreign currency financial statements, certain
deferred gains and losses from hedging activities, and unrealized gains and
losses on certain investment securities.

We do not expect that these new recommendations will have a
material impact on our consolidated results of operations and financial
condition.

Business Risks

Increases and volatility in crude oil prices and volatility
in wholesale petroleum pricing and supply could affect our revenues and gross
profit.As a result of our expansion in the United States, our motor fuel
revenues have become a greater component of revenues. For the 53-week period
ended April 30, 2006, our motor fuel revenues represented approximately 60% of
total revenues and our motor fuel gross profit accounted for approximately 20%
of our total gross profit. Crude oil and domestic wholesale petroleum markets
display significant volatility. Since we typically have no more than a four to
five-day supply of motor fuel, we are susceptible to interruptions in the supply
of motor fuel at our facilities. General political conditions and instability in
oil producing regions, particularly in the Middle East and South America, could
significantly and adversely affect crude oil supplies and wholesale petroleum
costs. Local supply interruptions may also occur. For example, in August 2003, a
cracked pipeline interrupted the supply of motor fuel to the greater Phoenix
area. In addition, any new standards that the U.S. Environmental Protection
Agency may impose on petroleum refining that would necessitate changes in
the refining process could limit the volume of petroleum products available from
refiners in the future. Volatility in wholesale petroleum supply and costs could
result in significant changes in the retail price
of petroleum products and in lower fuel gross margin per gallon or litre. In
addition, changes in the retail price of petroleum products could dampen
consumer demand for motor fuel. These factors could materially influence our
motor fuel volume, motor fuel gross profit and overall customer traffic, which,
in turn, could have a material adverse effect on our operating results and
financial condition.

16

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The convenience store and retail motor fuel industries are
highly competitive and affected by new entrants. The industries and
geographic areas in which we operate are highly competitive and marked by ease
of entry and constant change in terms of the number and type of retailers
offering the products and services found in our stores. We compete with other
convenience store chains, independent convenience stores, gas station operators,
large and small food retailers, local pharmacies and pharmaceutical chains,
discount stores, club stores and mass merchants, many of which are
well-established companies. In recent years, several non-traditional retail
segments have entered the motor fuel retail business, including supermarkets,
club stores and mass merchants, and this additional competition has had a
negative impact on motor fuel profit margins in the convenience store industry.
These non-traditional motor fuel retailers have obtained a significant share of
the motor fuel market and their market share is expected to grow. In some of our
markets, our competitors have been in existence longer and have greater
financial, marketing and other resources than we do. We may not be able to
compete successfully against current and future competitors, and competitive
pressures faced by us could materially and adversely affect our business,
results of operations and financial condition.

We are subject to federal, provincial, state and local
environmental laws, and the costs of compliance could require substantial
capital expenditures. Our operations are subject to a variety of
environmental laws and regulations, including those relating to emissions to the
air, discharges into water, releases of hazardous and toxic substances, and
remediation of contaminated sites. Under various federal, provincial, state and
local laws and regulations, we may, as the owner or operator, be liable for the
costs of removal or remediation of contamination at our current stores or our
former stores, whether or not we knew of, or were responsible for, the presence
of such contamination. In particular, as an owner and operator of motor fuelling
stations, we face risks relating to petroleum product contamination, which other
convenience store operators not engaged in such activities would not face. The
remediation costs and other costs required to clean up or treat contaminated
sites could be substantial.

Contamination on and from our current or former stores may
subject us to liability to third parties or governmental authorities for
injuries to persons, property or natural resources and may adversely affect our
ability to sell or rent our properties or to borrow money using such properties
as collateral.

In the United States, persons who dispose of or arrange for
the disposal or treatment of hazardous or toxic substances away from sites may
also be liable for the costs of removal or remediation of such substances at the
disposal sites even if such sites are not owned by such persons. Although we do
not typically arrange for the treatment or disposal of large quantities of
hazardous or toxic substances from any location, our current and historic
operation of many stores and the disposal of contaminated soil and groundwater
wastes generated during cleanups of contamination at such stores could expose us
to such liability.

We are subject to extensive environmental laws and
regulations regulating underground storage tanks and vapour recovery systems.
Compliance with existing and future environmental laws regulating such tanks and
systems may require significant expenditures. In the United States, we pay fees
to state "leaking underground storage tank" trust funds in states where they
exist. These state trust funds are expected to pay or reimburse us for
remediation expenses related to contamination associated with underground
storage tanks subject to their jurisdiction. Such payments are always subject to
a deductible paid by us, specified per incident caps and specified maximum
annual payments which vary among the funds. As well, such funds may have
eligibility requirements, which not all of our sites will meet. To the extent
state funds, or other responsible parties do not pay or delay payments for
remediation, we will be obligated to make these payments, which could materially
adversely affect our financial condition and results of operations. We cannot
assure that these funds or responsible third parties are or will continue to
remain viable.

The nature of our motor fuel operations and those we acquire
present risks of soil and groundwater contamination. In the future, we may incur
substantial expenditures for remediation of contamination that has not been
discovered at existing stores or at stores which we may acquire. We believe that
a significant number of our current stores may be contaminated and expect to
discover that contamination through the normal operation of our business in the
future. We regularly monitor our facilities for environmental contamination and
take reserves on our financial statements to cover potential environmental
remediation and compliance costs, as we consider appropriate. However, we cannot
assure that the liabilities for which we have taken reserves are the only
environmental liabilities relating to our current and former stores, that
material environmental conditions not known to us do not exist, that future laws
or regulations will not impose material environmental liability on us or that
our actual environmental liabilities will not exceed our reserves. In addition,
failure to comply with any environmental regulations or an increase in
regulations could materially and adversely affect our operating results and
financial condition.

17

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Future tobacco legislation,
campaigns to discourage smoking, increases in tobacco taxes and wholesale cost
increases of tobacco products could have a material adverse impact on our
revenues and profit.Tobacco products
represent our largest product category of merchandise and service revenues. For
fiscal year ended April 30, 2006, revenues of tobacco products were
approximately 38% of total merchandise and service revenues. Significant
increases in wholesale cigarette costs and a tax increase on tobacco products,
as well as future legislation and national and local campaigns to discourage
smoking in the United States and Canada, may have an adverse effect on the
demand for tobacco products, and therefore reduce our revenues and profits.

Competitive pressures in our
markets can make it difficult to pass price increases on to our customers. These
factors could materially and adversely affect our retail price of cigarettes,
cigarette unit volume and revenues, merchandise gross profit and overall
customer traffic. Because we derive a large percentage of our revenues from
tobacco products, reduced revenues of tobacco products or smaller margins on the
revenues we make could have a material adverse effect on our operating results
and financial condition.

Because we depend on the
experience and industry knowledge of our management, we would be adversely
affected if members of our management team left us.Our senior management team and the heads of our operating divisions who are
principally responsible for our operations under our decentralized management
structure are key elements of our business operations. Our future success
depends on our ability to retain this team. If, for any reason, our senior
executives and divisional vice-presidents do not continue to be active in
management, our business, financial condition or results of operations could be
adversely affected. We do not enter into employment agreements or
non-competition agreements with our officers. Although we believe that current
management will remain active in the business and that we will continue to be
able to attract and retain other talented personnel and replace key personnel
should the need arise, competition in recruiting replacement personnel could be
significant. If we are not successful in retaining our key personnel or
replacing them, our business, financial condition or results of operations could
be adversely affected.

Acquisitions have been a
substantial part, and are expected to continue to be a part, of our growth
strategy, which could expose us to significant business risks.Acquisitions have been a significant part of our growth strategy. We expect to
continue to selectively seek strategic acquisitions in the future. Our ability
to consummate and to integrate effectively any future acquisitions on terms that
are favorable to us may be limited by the number of attractive acquisition
targets, internal demands on our resources and, to the extent necessary, our
ability to obtain financing on satisfactory terms for larger acquisitions, if at
all. Acquisitions may expose us to additional risks, including:

- difficulties in integrating
  administrative, financial reporting, operational and information systems and
  managing newly-acquired operations and improving their operating efficiency;
- difficulties in maintaining
  uniform standards, controls, procedures and policies across all of our
  businesses;
- entry into markets in which we
  have little or no direct prior experience;
- difficulties in retaining key
  employees of the acquired operations;
- disruptions to our ongoing
  business; and
- diversion of management time
  and resources.

In addition, future acquisitions
could result in the incurrence of additional debt, costs and contingent
liabilities. We may also incur costs and divert management attention for
potential acquisitions, which are never consummated. For acquisitions we do
consummate, expected synergies may not materialize. Our failure to effectively
address any of these issues could adversely affect our results of operations,
financial condition and ability to service debt, including the subordinated
debt.

Although we have historically
performed a due diligence investigation of the businesses or assets that we
acquire and anticipate continuing to do so for future acquisitions, there may be
liabilities of the acquired business or assets that we fail or are unable to
uncover during our due diligence investigation and for which we, as a successor
owner, may be responsible.

When feasible, we seek to
minimize the impact of these types of potential liabilities by obtaining
indemnities and warranties from the seller, which may in some instances be
supported by deferring payment of a portion of the purchase price. However,
these indemnities and warranties, if obtained, may not fully cover the
liabilities because of their limited scope, amount or duration, the financial
resources of the indemnitor or warrantor or other reasons.

18

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We may experience difficulties in executing key aspects of
our business strategy or in differentiating ourselves from our competitors.The future success of our business is highly dependent upon effectively
implementing our business strategy and differentiating ourselves from our
competitors. We may experience difficulties in executing key aspects of our
business strategy. For example, we may be limited in our ability to implement
our IMPACT program in additional stores because of a number of factors,
including limited capital expenditure resources and restrictions contained in
our senior credit facility. In addition, our in-store branding strategies may be
less successful than we anticipate in increasing our gross margins. We may be
unable to obtain new QSR franchises, and it is possible that our existing QSR
franchises would be cancelled. We may also be less successful than anticipated
in achieving volume-purchasing benefits. Furthermore, we may experience
difficulty in differentiating ourselves from our competitors if our competitors
are able to successfully employ business strategies similar to ours or if market
conditions or demographics reduce what we believe to be our competitive
advantages.

We are subject to government regulations relating to, among
other things, alcohol, tobacco and minimum wage. Our business and properties
are subject to governmental laws and regulations including, but not limited to,
employment laws and regulations, regulations governing the sale of alcohol and
tobacco, minimum wage requirements and other laws and regulations.

In certain areas where our stores are located, provincial,
state or local laws limit the stores' hours of operation or the sale of
alcoholic beverages, tobacco products, possible inhalants and lottery tickets,
in particular to minors. Failure to comply with these laws could adversely
affect our revenues and results of operations because these state and local
regulatory agencies have the power to revoke, suspend or deny applications for
and renewals of permits and licenses relating to the sale of these products or
to seek other remedies.

Regulations related to wages also affect our business. Any
appreciable increase in the statutory minimum wage would result in an increase
in our labor costs and such cost increase, or the penalties for failing to
comply with such statutory minimums, could adversely affect our business,
financial condition and results of operations.

Any change in the legislation or regulations described above
that is adverse to us and our properties could affect our operating and
financial performance. In addition, new regulations are proposed from time to
time which, if adopted, could have a material adverse effect on our operating
results and financial condition.

We are subject to short-term interest rate fluctuations.
Since approximately 95% of our long-term debt is directly or indirectly (through
interest rate swaps) based on variable interest rate of no longer than six
months in duration, we can experience interest expense variances solely based on
changes in short-term interest rates.

Lawsuits relating to tobacco products. We sell cigarettes
and other tobacco-related products at all of our convenience stores. In
addition, we sell brands of cigarettes that are manufactured to be sold by it on
an exclusive basis. We are not currently a named party in any health-related
tobacco litigation. However, various health-related legal actions, proceedings
and claims arising out of the sale, distribution, manufacture, development,
advertising and marketing of cigarettes have been brought against vendors of
tobacco products and may be instituted against us in the future. Damages in
amounts escalating into the hundreds of millions and even billions of dollars
have been pleaded in suits brought against vendors of cigarettes. An unfavorable
verdict against us in any health-related suit could adversely affect our
financial condition and ability to pay interest and principal on our debts.
Moreover, we have not established any reserves for the payment of expenses or
adverse results related to any potential health-related litigation.

Changes in regional economic conditions may influence the
retail industry, consumer preferences and spending patterns. Our revenues
may be negatively influenced by changes in regional or local economic variables
and consumer confidence. External factors that affect economic variables and
consumer confidence and over which we exercise no influence include unemployment
rates, levels of personal disposable income and regional or local economic
conditions. Changes in economic conditions could adversely affect consumer
spending patterns, travel and tourism in certain of our market areas. Some of
our stores are located in coastal, resort or tourist destinations and,
historically, travel and consumer behavior in such markets is more severely
affected by weak economic conditions.

19

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We may be subject to losses that might not be covered in
whole or in part by our insurance coverage.We carry comprehensive
liability, fire and extended coverage insurance on most of our facilities, with
policy specifications and insured limits customarily carried in our industry for
similar properties. The cost of our insurance policies has increased recently.
In addition, some types of losses, such as losses resulting from wars, acts of
terrorism, or natural disasters, generally are not insured because they are
either uninsurable or not economically practical. Moreover, insurers recently
have become more reluctant to insure against these types of events.

Should an uninsured loss or a loss in excess of insured
limits occur, we could lose capital invested in that property, as well as the
anticipated future revenues derived from the retailing activities conducted at
that property, while remaining obligated for any mortgage debt or other
financial obligations related to the property. Any such loss could adversely
affect our business, results of operations or financial condition.

Acts of war and terrorism could impact our business. Acts
of war and terrorism could impact general economic conditions and the supply and
price of crude oil. In addition, these events may cause damage to our retail
facilities and disrupt the supply of the products and services we offer in our
stores. In times of uncertainty, people also tend to travel less and spend more
time at home. All these factors could impact our revenues, operating results and
financial condition.

Other risks

Motor Fuel Margin risk. With the purchase of Circle K,
which has a large component of its business in motor fuel, we are more sensitive
to the changes in the motor fuel gross margin. For example, in fiscal 2006, a
change of one cent per gallon would have resulted in a change of $20.3 million
in the motor fuel gross profit. Such amount would impact net earnings by $0.07
per share ($0.06 per share on a diluted basis) for our Company-operated stores
in the U.S.

Electronic payment modes related expense risk. The
majority of our electronic payment modes related expense is based on retail
prices of motor fuel. We are exposed to significant fluctuations in electronic
payment modes related expense as a result of the large increase in motor fuel
selling prices particularly in our U.S. markets. For example, based on fiscal
2006, for each ten cent increase in the retail selling price of a gallon of
motor fuel, the electronic payment modes related expense would have increased by
approximately $2.1 million. In Canada, for each Cdn ten cent increase in the
selling price of a litre of motor fuel, electronic payment modes related expense
would have increased by approximately $1.4 million. Such amounts would impact,
in the aggregate, net earnings by $0.01 per share on a diluted basis.

Interest Rate Risk. We are exposed to market risk
relating to changes in interest rates relating to our variable rate debt. We
have a significant amount of debt, $516.5 million of which, in effect, bears
interest at floating rates, including the $350.0 million 7.5% Subordinated
unsecured debt that is subject to interest rate swaps. Our total annual interest
expense, assuming interest rates as they were in effect on April 30, 2006, would
be approximately $41.0 million. A one-percentage point increase in interest
rates would increase our total annual interest expense by $5.2 million or $0.02
per share on a diluted basis.

Seasonality and natural disasters. Weather conditions can
have an impact on our revenues as historical purchase patterns indicate that our
customers increase their transactions and also purchase higher margin items when
weather conditions are favorable. Consequently, our results are seasonal and
typically more profitable during the summer months. Motor fuel volumes and
margins are also seasonal as volumes increase during the summer driving season
as well as margins. Motor fuel margins are subject to fluctuation due to supply
changes and can differ from historical norms. We have operations in the
Southeast and Westcoast regions of the United States and although these regions
are generally known for their mild weather, these regions are susceptible to
severe storms including hurricanes, like we experienced in fiscal 2006 and 2005,
as well as earthquakes in the Westcoast region and other natural disasters. We
could be also impacted by other occurrences in these regions such as energy
shortages or increase in energy prices. Consequently, our operating results and
cash flow from operations could be adversely affected. Moreover, since we have
decided, during fiscal 2006, not to renew our insurance coverage for material
damages related to hurricanes, such natural disasters could adversely affect our
operating results and financial condition.

20

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Outlook

We had a very successful year in 2006, ending the year in a strong position
with $331.5 million in cash, an interest bearing debt of $524.1 million and
total equity of $966.0 million.

We generated net cash from operating activities of $401.5
million while investing $336.9 million in property and equipment and small
business acquisitions. We believe that our financial strength and the allocation
of our financial resources will form the basis of continued successful
implementation of our operating strategies. We will continue to invest capital
in our existing store base with a target in fiscal 2007 of converting
approximately 500 stores under our IMPACT program and adding approximately 100
new store locations through new store development and small acquisitions. We
anticipate that about 50 stores will be closed or converted into affiliated
stores, including 28 from the Circle K store network. As a result, we plan to
invest a net amount of approximately $300.0 million in property and equipment,
which is expected to be financed with net cash from operations.

For fiscal 2007, we are optimistic about our opportunities
while recognizing that growth in earnings is dependent on various external
factors, including the impact of the foreign exchange rate, motor fuel gross
margin and electronic payment modes related expenses.

We will continue to focus our resources on innovation, including the
introduction of new products and services, to satisfy our customers needs.

July 12, 2006





21

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Alimentation Couche-Tard Inc. 
Consolidated Financial Statements 
April 30, 2006, April 24, 2005 and April 25, 2004



|Managements Report                                                                           | 1
|--------------------------------------------------------------------------------------------- | -
|Report of Independent
    Registered Public Accounting Firm Consolidated Financial Statements | 2
|Consolidated Statements of Earnings                                                           | 3
|Consolidated Statements of Contributed Surplus                                                | 3
|Consolidated Statements of Retained Earnings                                                  | 3
|Consolidated Statements of Cash Flows                                                         | 4
|Consolidated Balance Sheets                                                                   | 5
|Notes to Consolidated Financial Statements                                                    | 6





---

MANAGEMENTS REPORTThe consolidated financial statements of Alimentation
Couche-Tard Inc. and financial information contained in this Annual Report are
the responsibility of management. This responsibility is based on a judicious
choice of accounting procedures and principles, the application of which
requires the informed judgment of management. The consolidated financial
statements were prepared according to generally accepted accounting principles
in Canada and were approved by the Board of Directors. In addition, the
financial information included in the Annual Report is consistent with the
consolidated financial statements.
Alimentation Couche-Tard Inc. maintains accounting and
administrative control systems which, in the opinion of management, ensure
reasonable accuracy, relevance and reliability of financial information and
well-ordered, efficient management of the Companys affairs.
The Board of Directors is responsible for approving the
consolidated financial statements included in this Annual Report, primarily
through its Audit committee. This Committee, which holds periodic meetings with
members of management as well external auditors, reviewed the consolidated
financial statements of Alimentation Couche-Tard Inc. and recommended their
approval to the Board of Directors.
The enclosed consolidated financial statements were audited
by Raymond Chabot Grant Thornton LLP, our independent registered public
accounting firm, and their report indicates the extent of their audit and their
opinion on the consolidated financial statements.

|                                      |                            
|------------------------------------- | ---------------------------
|Alain Bouchard                        | Richard Fortin             
|Chairman of the Board,                | Executive Vice-President   
|president and Chief Executive Officer | and Chief Financial Officer



1

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTo the Shareholders of 
Alimentation Couche-Tard Inc.

We have audited the consolidated balance sheets of
Alimentation Couche-Tard Inc. as at April 30, 2006 and April 24, 2005 and the
consolidated statements of earnings, contributed surplus, retained earnings and
cash flows for each of the years in the three-year period ended April 30, 2006.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with Canadian generally
accepted auditing standards and the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform an audit to obtain reasonable assurance whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, these consolidated financial statements
present fairly, in all material respects, the financial position of the Company
as at April 30, 2006 and April 24, 2005 and the results of its operations and
its cash flows for each of the years in the three-year period ended April 30,
2006 in accordance with Canadian generally accepted accounting principles.

We also have audited, in accordance with the Standards of the
Public Company Accounting Oversight Board (United States), the effectiveness of
Alimentation Couche-Tard Inc.s internal control over financial reporting as at
April 30, 2006, based on criteria established in



Chartered Accountants

Montréal, Canada 
June 14, 2006



2

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CONSOLIDATED STATEMENTS OF EARNINGSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars (Note 2), except per share amounts)

|                                                                                      | 2006       | 2005       | 2004             
|------------------------------------------------------------------------------------- | ---------- | ---------- | -----------------
|                                                                                      | (53 weeks) | (52 weeks) | (52 weeks)       
|                                                                                      |            |            | restated (Note 3)
|                                                                                      | $          | $          | $                
|Revenues                                                                              | 10,157.3   | 8,036.8    | 4,395.3          
|Cost of sales                                                                         | 8,365.8    | 6,479.0    | 3,480.8          
|Gross profit                                                                          | 1,791.5    | 1,557.8    | 914.5            
|                                                                                      |            |            |                  
|Operating, selling, administrative and
    general expenses                           | 1,352.9    | 1,214.7    | 740.3            
|Depreciation and amortization of property and equipment and
    other assets (Note 6) | 106.9      | 83.9       | 57.7             
|                                                                                      | 1,459.8    | 1,298.6    | 798.0            
|Operating income                                                                      | 331.7      | 259.2      | 116.5            
|Financial expenses (Note 6)                                                           | 34.0       | 30.7       | 23.5             
|Earnings before income taxes and write-off of financing costs                         | 297.7      | 228.5      | 93.0             
|Write-off of financing costs (Note 16)                                                | -          | -          | 9.2              
|Earnings before income taxes                                                          | 297.7      | 228.5      | 83.8             
|Income taxes (Note 7)                                                                 | 101.5      | 73.3       | 27.7             
|Net earnings                                                                          | 196.2      | 155.2      | 56.1             
|                                                                                      |            |            |                  
|Net earnings per share (Note 8)                                                       |            |            |                  
|Basic                                                                                 | 0.97       | 0.77       | 0.31             
|Diluted                                                                               | 0.94       | 0.75       | 0.30             

CONSOLIDATED STATEMENTS OF CONTRIBUTED SURPLUS

|                                                          | 2006       | 2005       | 2004             
|--------------------------------------------------------- | ---------- | ---------- | -----------------
|                                                          | (53 weeks) | (52 weeks) | (52 weeks)       
|                                                          |            |            | restated (Note 3)
|                                                          | $          | $          | $                
|Balance, beginning of year, as previously
    reported    | 5.6        | 0.8        | 0.8              
|Impact of change in accounting for stock options (Note 3) | -          | 2.4        | -                
|Balance, beginning of year, as restated                   | 5.6        | 3.2        | 0.8              
|Stock-based compensation (Note 19)                        | 3.8        | 2.5        | -                
|Fair value of stock options exercised                     | -          | (0.1)      | -                
|Balance, end of year                                      | 9.4        | 5.6        | 0.8              

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS

|                                                                                   | 2006       | 2005       | 2004             
|---------------------------------------------------------------------------------- | ---------- | ---------- | -----------------
|                                                                                   | (53 weeks) | (52 weeks) | (52 weeks)       
|                                                                                   |            |            | restated (Note 3)
|                                                                                   | $          | $          | $                
|Balance, beginning of year, as previously
    reported (a)                         | 317.5      | 164.7      | 110.2            
|Impact of change in accounting for stock options, without
    restatement (Note 3) | -          | (2.4)      | -                
|                                                                                   | 317.5      | 162.3      | 110.2            
|Net earnings                                                                       | 196.2      | 155.2      | 56.1             
|                                                                                   | 513.7      | 317.5      | 166.3            
|Dividends                                                                          | (8.7)      | -          | -                
|Share issue expenses (net of future income taxes of $0.8)                          | -          | -          | 1.6              
|Balance, end of year                                                               | 505.0      | 317.5      | 164.7            
|(a) Including the accounting
    changes done with restatement (Note 3).          

The accompanying notes are an integral part of the consolidated financial
statements.

3

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CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                                                      | 2006       | 2005       | 2004             
|--------------------------------------------------------------------------------------------------------------------- | ---------- | ---------- | -----------------
|                                                                                                                      | (53 weeks) | (52 weeks) | (52 weeks)       
|                                                                                                                      |            |            | restated (Note 3)
|                                                                                                                      | $          | $          | $                
|Operating activities                                                                                                  |            |            |                  
|Net earnings                                                                                                          | 196.2      | 155.2      | 56.1             
|Adjustments to reconcile net earnings to net
    cash provided by operating activities                                |            |            |                  
|Depreciation and amortization of property and
    equipment and other assets, net of amortization of deferred credits | 99.2       | 75.0       | 51.9             
|Future income taxes                                                                                                   | 26.8       | 26.4       | (12.8)           
|Loss on disposal of property and equipment and
    other assets                                                       | 2.1        | 1.7        | 2.5              
|Write-off of financing costs                                                                                          | -          | -          | 9.2              
|Deferred credits                                                                                                      | 15.2       | 13.5       | 9.1              
|Other                                                                                                                 | 4.8        | (1.7)      | (0.1)            
|Changes in non-cash working capital (Note 9)                                                                          | 57.2       | 46.0       | 118.8            
|Net cash provided by operating activities                                                                             | 401.5      | 316.1      | 234.7            
|                                                                                                                      |            |            |                  
|Investing activities                                                                                                  |            |            |                  
|Purchase of property and equipment                                                                                    | (245.3)    | (182.8)    | (85.6)           
|Business acquisitions (Note 5)                                                                                        | (91.6)     | (69.6)     | (772.5)          
|Proceeds from sale and leaseback transactions                                                                         | 36.2       | 19.9       | 284.1            
|Temporary investments                                                                                                 | (21.0)     | -          | -                
|Proceeds from disposal of property and
    equipment and other assets                                                 | 15.9       | 20.5       | 3.9              
|Increase in other assets                                                                                              | (7.0)      | (6.5)      | (2.4)            
|Liabilities assumed on business acquisitions                                                                          | (4.0)      | (5.1)      | (1.7)            
|Net cash used in investing activities                                                                                 | (316.8)    | (223.6)    | (574.2)          
|                                                                                                                      |            |            |                  
|Financing activities                                                                                                  |            |            |                  
|Dividends paid                                                                                                        | (8.7)      | -          | -                
|Repayment of long-term debt                                                                                           | (6.9)      | (6.3)      | (557.9)          
|Issuance of shares, net of share issue
    expenses                                                                   | 0.2        | 9.3        | 169.0            
|Increase in long-term debt, net of financing costs                                                                    | -          | 0.2        | 846.9            
|Net cash provided by (used in) financing activities                                                                   | (15.4)     | 3.2        | 458.0            
|Effect of exchange rate fluctuations on cash and cash
    equivalents                                                 | 9.5        | 3.2        | 1.9              
|Net increase in cash and cash equivalents                                                                             | 78.8       | 98.9       | 120.4            
|Cash and cash equivalents, beginning of year                                                                          | 252.7      | 153.8      | 33.4             
|Cash and cash equivalents, end of year                                                                                | 331.5      | 252.7      | 153.8            
|                                                                                                                      |            |            |                  
|The accompanying notes are an integral part
    of the consolidated financial statements.                             |            |            |                  

4

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CONSOLIDATED BALANCE SHEETS

|                                                                                          | 2006    | 2005   
|----------------------------------------------------------------------------------------- | ------- | -------
|                                                                                          | $       | $      
|Assets                                                                                    |         |        
|Current assets                                                                            |         |        
|Cash and cash equivalents                                                                 | 331.5   | 252.7  
|Temporary investments                                                                     | 21.4    | -      
|Accounts receivable (Note 10)                                                             | 153.0   | 109.7  
|Income taxes receivable                                                                   | 0.7     | 31.6   
|Inventories (Note 11)                                                                     | 322.3   | 295.4  
|Prepaid expenses                                                                          | 15.2    | 10.0   
|Future income taxes (Note 7)                                                              | 18.9    | 17.2   
|                                                                                          | 863.0   | 716.6  
|Property and equipment (Note 12)                                                          | 1,014.1 | 812.0  
|Goodwill                                                                                  | 245.8   | 224.9  
|Trademarks and licenses                                                                   | 175.4   | 172.5  
|Other assets (Note 13)                                                                    | 70.3    | 68.1   
|Future income taxes (Note 7)                                                              | 0.6     | 1.6    
|                                                                                          | 2,369.2 | 1,995.7
|                                                                                          |         |        
|Liabilities                                                                               |         |        
|Current liabilities                                                                       |         |        
|Accounts payable and accrued liabilities (Note
    15)                                    | 681.8   | 609.6  
|Current portion of long-term debt (Note 16)                                               | 8.0     | 7.0    
|Future income taxes (Note 7)                                                              | 0.1     | 0.1    
|                                                                                          | 689.9   | 616.7  
|Long-term debt (Note 16)                                                                  | 516.1   | 523.9  
|Deferred credits and other liabilities (Note
    17)                                      | 127.2   | 89.6   
|Future income taxes (Note 7)                                                              | 70.0    | 32.3   
|                                                                                          | 1,403.2 | 1,262.5
|                                                                                          |         |        
|Shareholders equity                                                                      |         |        
|Capital stock (Note 18)                                                                   | 351.0   | 350.8  
|Contributed surplus                                                                       | 9.4     | 5.6    
|Retained earnings                                                                         | 505.0   | 317.5  
|Cumulative translation adjustments                                                        | 100.6   | 59.3   
|                                                                                          | 966.0   | 733.2  
|                                                                                          | 2,369.2 | 1,995.7
|                                                                                          |         |        
|The accompanying notes are an
    integral part of the consolidated financial statements.

|                        |               
|----------------------- | --------------
|On behalf of the Board, |               
|                        |               
|                        |               
|Alain Bouchard          | Richard Fortin
|Director                | Director      

5

---



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Governing statutes and nature of operations

Alimentation Couche-Tard Inc. (the Company) is incorporated
under the Companies Act (Quebec).

The Company owns and licenses 4,983 convenience stores across
North America of which 3,632 are Company-operated and generates income primarily
from the sales of tobacco products, grocery items, beverages, fresh food
offerings, including quick service restaurants, motor fuel and other products
and services.

2. Basis of presentation

Year end date

The Companys year end is the last Sunday of April of each
year. For comparative purposes, the years ended April 30, 2006, April 24, 2005
and April 25, 2004 are referred to as 2006, 2005 and 2004. The year ended April
30, 2006 has 53 weeks (52 weeks in 2005 and 2004).

Basis of presentation

The consolidated financial statements have been prepared in
accordance with Canadian generally accepted accounting principles (Canadian GAAP).

Change in reporting currency

As at April 25, 2005, the Company has changed its reporting
currency from Canadian dollars to US dollars to provide more relevant
information considering its predominant operations in the United States and its
US dollar denominated debt. For comparative purposes, historical consolidated
financial statements and notes have been restated into US dollars using the
current rate method. The functional currencies of the Company and each of its
subsidiaries remained unchanged.

3. Accounting changes

2006

Non-monetary transactions

On June 1, 2005, the Canadian Institute of Chartered
Accountants (CICA) issued Handbook Section 3831, "Non-Monetary Transactions",
replacing Section 3830 of the same name. Under these new standards, all
non-monetary transactions initiated in periods beginning on or after January 1,
2006 have to be measured at fair value unless:

- the transaction lacks commercial substance;
- the transaction is an exchange of a product or property
  held for sale in the ordinary course of business for a product or property to
  be sold in the same line of business to facilitate sales to customers other
  than the parties to the exchange;
- neither the fair value of the assets received nor the fair
  value of the asset given up is reliably measurable; or
- the transaction is a non-monetary, non-reciprocal transfer
  to owners that represents a spin-off or other form of restructuring or
  liquidation.

The Company adopted these new recommendations both early and
prospectively on July 18, 2005. The implementation of these new recommendations
did not have a material impact on the Companys consolidated financial
statements.

2005

Accounting for property and equipment and lease accounting

During 2005, the Company undertook a review of its
depreciation and amortization policies for all of its property and equipment and
of its lease accounting policies. Previously, the Company used the decreasing
charge method at various rates to calculate depreciation, except for Circle K
where the straight-line method was used. In addition, leasehold improvements
were amortized over the shorter of the term of the lease plus renewal periods or
their useful lives and rent expense was recorded over the committed lease period
and did not take into account future rent escalations included in the lease
term.

As a result of the review and an in depth study of the useful
lives of its property and equipment, the Company decided to change its
accounting policy for depreciation and amortization of property and equipment to
use the straight-line method throughout the Company. This method is more
representative of the actual useful lives of the assets and provides uniformity
within the Company. This change has been applied retroactively and prior years
consolidated financial statements have been restated.

Following a review of its lease accounting policies and the
relevant accounting literature, the Company has determined it should amortize
its leasehold improvements over the shorter of their useful lives or the lease
term. Moreover, the Company decided it should record lease expense using the
straight-line method. Accordingly, the Company has restated previously reported
consolidated financial statements to reflect these changes.

The impact of those changes as of April 25, 2004 is a
decrease in property and equipment of $10.0, an increase in net future income
tax assets of $6.5, an increase in accounts payable and accrued liabilities of
$0.6, an increase in deferred credits and other liabilities of $8.1, a reduction
in retained earnings of $11.5 and a decrease in the cumulative translation
adjustments balance of $0.7.

For 2005, the impact of those changes resulted in a $1.7
increase of the depreciation expense ($1.6 in 2004), a $3.5 increase in lease
expense ($1.9 in 2004) and in a $3.7 decrease in net earnings ($2.7 in 2004).
The impact on diluted net earnings per share is a decrease of $0.02 in 2005 and
$0.01 in 2004.

6

---



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

3. Accounting changes (continued)

Consolidation of variable interest entities

During 2005, the Company adopted the CICA Accounting
Guideline No.15 (AcG-15) "Consolidation of Variable Interest Entities" (VIEs)
that came into effect November 1, 2004. This guideline clarifies and addresses
the application of consolidation guidance to those entities defined as VIEs,
which are entities that are subject to control on a basis other than voting
interests. Such entities should be consolidated by the primary beneficiary,
which is the entity that will absorb a majority of the VIEs expected losses or
will receive a majority of its expected residual returns, or both.

The implementation of this guideline did not have any
material impact on the Companys consolidated financial statements.

Asset retirement obligations

During 2005, the Company adopted the new CICA Handbook
Section 3110, "Asset Retirement Obligations", which establishes standards for
the recognition, measurement and disclosure of legal obligations associated with
the costs to retire long-lived assets. Accordingly, under the new standard, the
fair value of the future retirement costs of the Companys underground motor
fuel storage tanks is recorded as a liability on a discounted basis when it is
incurred and an equivalent amount is capitalized to property and equipment. The
initial recorded obligation, which has been discounted using the Companys
credit-adjusted risk free-rate, will be reviewed periodically to reflect the
passage of time and changes in the estimated future costs underlying the
obligation. The Company amortizes the initial amount capitalized to property and
equipment and recognizes accretion expense in connection with the discounted
liability over the estimated remaining useful life of the underground motor fuel
storage tanks.

The new standard has been applied retroactively and
consolidated financial statements of the prior periods have been restated. The
impact of this change as of April 25, 2004 is an increase in property and
equipment of $12.9, an increase in asset retirement obligations of $15.9, an
increase in net future income tax assets of $1.3 and a reduction in retained
earnings of $1.7.

For 2005 and 2004, the impact on net earnings is a decrease
of $1.8 and $0.3, respectively (a decrease of $0.01 per share on a diluted basis
in 2005 and nil in 2004).

Stock-based compensation and other stock-based payments

Effective April 26, 2004, the Company adopted the amended
recommendations of the CICA relating to Section 3870, "Stock-based Compensation
and Other Stock-based Payments". These amendments require that stock-based
compensation costs be measured at the grant date of the award based on the fair
value method for all transactions entered into for years beginning on or after
January 1, 2002. The Company chose to apply these amendments retroactively,
without restating prior periods, for stock options granted since April 29, 2002.
The fair value of the stock options is recognized over the vesting period as
compensation expense with a corresponding increase in contributed surplus. When
stock options are exercised, the corresponding contributed surplus is
transferred to capital stock.

Prior to April 29, 2002, the Company recorded no compensation
cost for its stock options granted to employees but provided, in its notes to
the consolidated financial statements, pro forma disclosures of net earnings and
net earnings per share as if the fair value based method of accounting had been
applied.

The retroactive treatment of these recommendations resulted
in a decrease of $2.4 in opening retained earnings with a corresponding increase
in contributed surplus (see Note 19).

Recording of certain consideration received from a vendor

On January 31, 2005, the Company adopted both early and
retroactively the amended recommendations of the Emerging Issues Committee of
the CICA relating to the third topic of Abstract 144 (EIC-144), "Accounting by a
Customer (Including a Reseller) for Certain Consideration Received From a
Vendor". These amendments address the recognition, measurement and disclosure
requirements for vendor rebates and state that those rebates must be recognized
when probable and reasonably estimable. Therefore, vendor rebates recognized in
earnings and for which the full requirements for entitlement have not yet been
met would be disclosed. The implementation of these new recommendations did not
have any material impact on the Companys consolidated financial statements.

Generally accepted accounting principles

In July 2003, the CICA issued Handbook Section 1100,
"Generally Accepted Accounting Principles", which establishes standards for
financial reporting in accordance with Canadian GAAP and provides guidance on
sources to consult when selecting accounting policies and determining
appropriate disclosures when a matter is not dealt with explicitly in the
primary sources of Canadian GAAP. The application of these new standards was
done prospectively starting on April 26, 2004 and had no material impact on the
Companys consolidated financial statements, except for the lease accounting
described above.

2004

Recording of certain consideration received from a vendor

In January 2004, the Emerging Issues Committee of the CICA
released EIC-144, "Accounting by a Customer (Including a Reseller) for Certain
Consideration Received From a Vendor". Under this new standard, certain cash
consideration received from a vendor should be considered as an adjustment of
the prices of the vendors products, and therefore should be characterized as a
reduction of cost of sales and related inventories when recognized in the
financial statements. Certain exceptions apply if the consideration is a payment
for assets or services delivered to the vendor or for reimbursement of selling
costs incurred to promote the vendors products, provided that certain
conditions are met.

The Company adopted these new recommendations both early and
retroactively on January 30, 2004 and consolidated financial statements from
prior years have been restated.

For the year ended April 25, 2004, application of EIC-144
resulted in a $0.7 increase in the cost of goods sold and a decrease in net
earnings of $0.5.

7

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

3. Accounting changes (continued)

Impairment of long-lived assets

In December 2002, the CICA issued Handbook Section 3063
entitled "Impairment of Long-lived Assets". This section sets out standards for
recognizing, measuring and reporting the impairment of long-lived assets. It
supersedes the write-down provisions included in Section 3061, "Property, Plant
and Equipment". This new section requires that the Company recognizes an
impairment loss for long-lived assets to be kept and used when events or changes
in circumstances result in their carrying amount exceeding the sum of the
undiscounted cash flows expected to result from their use and eventual disposal.
The impairment loss is equivalent to the amount by which the assets carrying
amount exceeds its fair value.

This modification of accounting principles was applied
prospectively beginning April 28, 2003 and had no material impact on the
carrying amount of the Company's long-lived assets.

Guarantees

In February 2003, the CICA issued Accounting Guideline No. 14
(AcG-14), ''Disclosure of Guarantees''. This guideline provides information
related to financial statements disclosures to be provided under certain
guarantees. The Company adopted these new recommendations as at April 28, 2003.

A guarantee is defined as a contract or an indemnification
agreement contingently requiring a company to make payments to a third party
based on future events. These payments are contingent on either changes in an
underlying or other variables that are related to an asset, liability, or an
equity security of the indemnified party or the failure of another entity to
perform under an obligating agreement. It could also be an indirect guarantee of
the indebtedness of another party.

4. Accounting policies

Accounting estimates

The preparation of consolidated financial statements in
accordance with Canadian GAAP requires management to make estimates and
assumptions that affect the amounts reported in the consolidated financial
statements and accompanying notes. On an ongoing basis, management reviews its
estimates, including those relating to supplier rebates, environmental costs and
asset retirement obligations based on available information. These estimates are
based on managements best knowledge of current events and actions that the
Company may undertake in the future. Actual results could differ from those
estimates.

Principles of consolidation

The consolidated financial statements include the accounts of
the Company and of its subsidiaries, all of which are wholly owned.

Foreign currency translation

The non-consolidated financial statements of the Company and
its subsidiaries are prepared based on their respective functional currencies,
which is US dollar for US operations and Canadian dollar for Canadian operations
and corporate activities.

As a result, in the Companys consolidated financial
statements, the Canadian and corporate operations are translated into US dollars
using the current rate method. Under this method, assets and liabilities are
translated using the exchange rate in effect at the balance sheet date. Revenues
and expenses are translated at the average rate in effect during the year. Gains
and losses are included in Cumulative translation adjustments account in the
Shareholders' equity.

Net earnings per share

Basic net earnings per share is calculated by dividing the
net earnings available to Class A and Class B shareholders by the weighted
average number of Class A and Class B shares outstanding during the year.
Diluted net earnings per share is calculated using the treasury stock method and
takes into account the dilutive effect of stock options and warrants.

Revenue recognition

For its two major product categories, merchandise and motor
fuel, the Company recognizes revenue at the point of sale. Merchandise sales are
comprised primarily of the sale of tobacco products, grocery items, candy and
snacks, beverages, beer, wine, fresh food offerings, including quick service
restaurants, and services.

Services revenues include the commission on sale of lottery
tickets and issuance of money orders, fees from automatic teller machines, sales
of calling cards and gift cards, fees for cashing cheques, sales of postage
stamps and bus tickets and car wash revenues. These revenues are recognized at
the time of transaction in stores. Services revenues also include franchise and
license fees, which are recognized in revenues over the period of the agreement
to which the fees relate and royalties from franchisees and licensees, which are
recognized periodically based on sales reported by franchise and licence
operators.

Operating, selling, administrative and general expenses

The main items comprising Operating, selling, administrative
and general expenses are labour, building occupancy costs and overhead and
include advertising expenses that are charged as incurred in the amount of $26.8
in 2006, $21.6 in 2005 and $13.8 in 2004.

Self-insurance

In the United States, the Company is self-insured for certain
losses related to general liability and workers compensation. The expected
ultimate cost for claims incurred as of the balance sheet date is not discounted
and is recognized as a liability. This cost is estimated based upon analysis of
the Companys historical data and actuarial estimates.

8

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

4. Accounting policies (continued)

Cash and cash equivalents

Cash includes cash and demand deposits. Cash equivalents
include highly liquid investments that can be converted into cash for a fixed
amount and that mature less than three months from the date of acquisition.

Temporary investments

Temporary investments are comprised of securities that have
maturities of more than three months and are valued at lower of cost and fair
value.

Inventories

Inventories are valued at the lesser of cost and net
realizable value. Cost of merchandise - distribution centres is determined
according to the first-in first-out method, the cost of merchandise - retail is
valued based on the retail price less a normal margin and the cost of motor fuel
inventory is determined according to the average cost method.

Vendor rebates

The Company records cash received from vendors related to
vendor rebates as a reduction in the price of the vendors products and reflects
them as a reduction of costs of sales and related inventory in its consolidated
statements of earnings and balance sheets when those rebates satisfy the
recognition criteria.

Income taxes

The Company uses the liability method to account for income
taxes. Under this method, future income tax assets and liabilities are
determined based on differences between the carrying amounts and tax bases of
assets and liabilities using enacted or substantively enacted tax rates and laws
at the date of the consolidated financial statements for the years in which the
temporary differences are expected to reverse. A valuation allowance is
recognized to the extent that it is more likely than not that all of the future
income tax assets will not be realized.

Depreciation and amortization

Property and equipment are stated at cost and depreciated
over their estimated useful lives using the straight-line method based on the
following periods:

|Buildings                          | 3 to 40 years
|---------------------------------- | -------------
|Equipment                          | 3 to 30 years
|Buildings under capital
    leases | Lease term   

Leasehold improvements and property and equipment on leased
properties are amortized and depreciated over the lesser of their useful lives
and the term of the lease.

Rent expense

Rent expense is recognized in earnings using the
straight-line method.

Goodwill

Goodwill is the excess of the cost of an acquired business
over the fair value of underlying net assets acquired from the business at the
time of acquisition. Goodwill is not amortized. It is rather tested for
impairment annually, or more frequently should events or changes in
circumstances indicate that it might be impaired. Should the carrying amount of
a reporting units goodwill exceed its fair value, an impairment loss would be
recognized.

Trademarks and licenses

Trademarks and licenses have indefinite lives, are recorded
at cost and are not amortized; rather, they are tested for impairment annually,
or more frequently, should events or circumstances indicate that the assets
might be impaired. Should the carrying amount of a trademark or license exceed
its fair value, an impairment loss in the amount of the excess would be
recognized.

Other assets

Other assets include deferred charges, environmental costs
receivable, accrued pension benefit asset and deposits.

Deferred charges are mainly financing costs amortized using
the effective interest rate method over the period of the corresponding debt.
Deferred charges also include expenses incurred in connection with the analysis
and signing of operating leases which are deferred and amortized on a
straight-line basis over the lease term. Other deferred charges are amortized on
a straight-line basis over periods of five to seven years.

9

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

4. Accounting policies (continued)

Employee future benefits

The Company accrues its obligations under employee pension
plans and the related costs, net of plan assets. The Company has adopted the
following policies with respect to the defined benefit plans:

- the accrued benefit obligations and the cost of pension
  benefits earned by active employees are actuarially determined using the
  projected benefit method prorated on service and pension expense is recorded
  in income as the services are rendered by active employees. The calculations
  reflect managements best estimate of expected plan investment performance,
  salary escalation and retirement ages of employees;
- for the purpose of calculating the expected return on plan
  assets, those assets are valued at fair value;
- actuarial gains (losses) arise from the difference between
  actual long-term rate of return on plan assets for a period and the expected
  long-term rate of return on plan assets for that period or from changes in
  actuarial assumptions used to determine the accrued benefit obligation. The
  excess of the net actuarial gain (loss) over 10% of the greater of the benefit
  obligation and fair value of plan assets is amortized over the average
  remaining service period of active employees. The average remaining service
  period of the active employees covered by the pension plans is 10 years;
- on May 1, 2000, the Company adopted the new accounting
  standard on employee future benefits using the prospective application method.
  The Company is amortizing the transitional asset on a straight-line basis over
  11 years, which was the average remaining service period of employees expected
  to receive benefits under the benefit plan as of May 1, 2000;
- past service costs are amortized on a straight-line basis
  over the average remaining service period of active employees.

The pension costs recorded in earnings for the defined
contribution plan is equivalent to the contribution which the Company is
required to pay in exchange for services provided by the employees.

Environmental costs

The Company provides for estimated future site remediation
costs to meet government standards for known site contaminations when such costs
can be reasonably estimated. Estimates of the anticipated future costs for
remediation activities at such sites are based on the Companys prior experience
with remediation sites and consideration of other factors such as the condition
of the site contamination, location of sites and experience with contractors
that perform the environmental assessments and remediation work.

Hedging and derivative financial instruments

The Company uses derivative financial instruments by way of
interest rate swaps to manage current and forecast risks related to interest
rate fluctuations associated with the Company's subordinated unsecured debt. The
Company does not use freestanding derivative financial instruments for trading
or speculative purposes.

The Company formally documents and designates each derivative
financial instrument as a hedge of its subordinated unsecured debt. The Company
determines that derivative financial instruments are effective hedges, at the
time of the establishment of the hedge and for the duration of the instrument,
since the date to maturity, the reference amount and interest rate of the
instruments correspond to all the conditions of the debt.

The Company uses interest rate swaps as part of its program
for managing the combination of fixed and variable interest rates of its debt
and the corresponding aggregate cost of borrowing. Interest rate swaps involve
an exchange of interest payments without an exchange of principal underlying the
interest payments. They are accounted for as an adjustment of accrued interest
expense on the debt instruments. The corresponding amount to be paid to
counterparties or to be received from counterparties is accounted for as an
adjustment of accrued interest.

In the case of an early termination of one of the interest
swap agreements or if the hedge ceases to be effective prior to maturity, any
realized and unrealized gains or losses would be recorded on the balance sheet
and amortized to consolidated statements of earnings over the remaining term of
the related hedged debt. In the event of early extinguishment of the debt, any
realized or unrealized gains or losses related to the swap would be recognized
in the consolidated statements of earnings at the time of the extinguishment of
the debt.

The Company has also designated its entire US dollars
denominated long-term debt as a foreign exchange hedge of its net investment in
its U.S. self-sustaining subsidiaries. Accordingly, corresponding foreign
exchange gains and losses are recorded in cumulative translation adjustments
account in the shareholders equity to offset the foreign currency translation
adjustments on the investments.

5. Business acquisitions

The Company has made the following business acquisitions that
were accounted for using the purchase method. Earnings from the businesses
acquired are included in the consolidated statements of earnings from their
respective dates of acquisition.

2006

During the year, the Company made the following business
acquisitions:

- effective March 14, 2006: purchase of 34 Company-operated
  stores and 19 affiliated stores, all operating under the Shell banner in the
  Indianapolis area of Indiana, United States, from Shell Oil Products US. At
  the closing date, two Company-operated stores were closed;
- effective December 14, 2005: purchase of 16
  Company-operated stores operating under the Winners banner in New Mexico,
  United States, from Conway Oil Company and Conway Real Estate Company;
- effective December 8, 2005: purchase of 18 Company-operated
  stores and 8 affiliated stores, all operating under the BP banner in the
  Memphis area of Tennessee, United States, from BP Products North America,
  Inc.;
- effective November 3, 2005: purchase of seven
  Company-operated stores operating under the Fuel Mart banner in Ohio, United
  States, from Ports Petroleum Co.

10

---



NOTES TO
CONSOLIDATED FINANCIAL STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

5. Business acquisitions (continued)

These four acquisitions were settled for a total cash
consideration of $91.6, financed from the Companys available cash. The net
assets acquired included working capital of $4.6, property and equipment of
$81.4, goodwill of $3.9, trademarks and licences of $2.0, other assets of $1.3
and deferred credits and other liabilities of $1.6. Most of the goodwill related
to these transactions is deductible for tax purposes.

2005

Changes to the purchase price allocation

During 2005, the Company finalized the allocation of the
purchase price related to the acquisition of The Circle K Corporation on
December 17, 2003. The final allocation resulted in an increase in property and
equipment of $16.5 and an increase in asset retirement obligations of $15.2
mainly due to a change in the estimate of the asset retirement obligations and
an increase in trademarks and licenses of $12.9 based on an external valuation
of trademarks.

In addition, the final allocation resulted in an increase in
net working capital of $1.6, an increase in other assets of $1.3 and a decrease
in net future income tax asset of $17.1. The preliminary allocation of the
purchase price is described below.

Acquisitions

During 2005, the Company made the following business
acquisitions:

- in April 2005: purchase of nine sites operating under the
  Thornton and Pit Stop banners in the Midwest region of United States, from
  Thornton Inc. and Broadus Oil Corporation of Illinois Inc.;
- effective February 2, 2005: purchase of 19 sites operating
  under the Pump N Shop banner in the Augusta, Georgia area, United States, from
  QVS Inc. and Brosious & Holt Properties LLC;
- effective November 3, 2004: purchase of 21 sites in the
  Phoenix, Arizona area, United States, from Shell Oil Products US.

These three acquisitions were settled for a total cash
consideration of $69.6 financed from the Companys available cash. The net
assets acquired included working capital of $3.3, property and equipment of
$64.0 and goodwill of $2.3. Most of the goodwill related to these transactions
is deductible for tax purposes.

2004

On December 17, 2003, the Company acquired all of the
outstanding shares of Circle K from ConocoPhillips Company. The assets included
a chain of 1,663 stores in 16 U.S. states, mainly in the southern United States.
At the acquisition date, Circle K also held franchise or licensing agreements
with another 627 stores in the U.S. and 4,003 international licenses agreements.

This acquisition was made for a total cash consideration of
$831.8, including acquisition costs and amounts payable in accordance with a
price adjustment clause, based on the working capital acquired. The acquisition
was financed by issuing 27,111,076 new Class B subordinate voting shares (see
Note 18) and by issuing new debt.

On September 4, 2003, the Company concluded the acquisition
of assets of Clark Retail Enterprises Inc. (Clark) including 43 stores in the
states of Illinois, Indiana, Iowa, Michigan and Ohio. This acquisition was made
for a total cash consideration of $29.9, including acquisition costs. The
transaction was financed by using the Company's existing credit facilities. Most
of the goodwill related to this transaction is deductible for tax purposes.

The preliminary allocations of the purchase prices of the
acquisitions were as follows:

|                                                   | Circle K | Clark | Total  
|-------------------------------------------------- | -------- | ----- | -------
|                                                   | $        | $     | $      
|Current assets                                     | 237.3    | 3.5   | 240.8  
|Property and equipment                             | 587.6    | 21.8  | 609.4  
|Goodwill                                           | -        | 5.3   | 5.3    
|Trademarks, licenses and other assets              | 159.2    | -     | 159.2  
|Future income taxes                                | 27.9     | 0.1   | 28.0   
|                                                   | 1,012.0  | 30.7  | 1,042.7
|                                                   |          |       |        
|Current liabilities assumed                        | 164.7    | 0.4   | 165.1  
|Long-term debt assumed                             | 6.7      | -     | 6.7    
|Deferred credits and other liabilities
    assumed | 8.8      | 0.4   | 9.2    
|                                                   | 180.2    | 0.8   | 181.0  
|Net assets and total consideration                 | 831.8    | 29.9  | 861.7  
|Less: cash from the acquisition                    | 80.6     | -     | 80.6   
|Net assets excluding cash from the
    acquisition | 751.2    | 29.9  | 781.1  
|Less: balance to be paid to vendors                | 8.6      | -     | 8.6    
|Cash consideration                                 | 742.6    | 29.9  | 772.5  

Subsequent to the acquisitions of Circle K and Clark, the
Company entered into sale and leaseback agreements under which certain property
and equipment acquired were sold to financial institutions and re-leased to the
Company under long-term leases. Most of these long-term leases are for periods
of 15 to 17 years, with the possibility of renewal. These transactions did not
result in any gains or losses for the Company. Proceeds related to these
transactions amounted to $267.7, net of related expenses.

11

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

6. Information included in the consolidated statements of earnings

|                                         | 2006  | 2005 | 2004             
|---------------------------------------- | ----- | ---- | -----------------
|                                         |       |      | restated (Note 3)
|                                         | $     | $    | $                
|Depreciation and amortization            |       |      |                  
|Property and equipment                   | 106.1 | 83.1 | 57.4             
|Other assets                             | 0.8   | 0.8  | 0.3              
|                                         | 106.9 | 83.9 | 57.7             
|                                         |       |      |                  
|Financial expenses                       |       |      |                  
|Interest on long-term debt               | 30.6  | 27.1 | 20.7             
|Amortization of deferred financing costs | 3.1   | 3.1  | 2.2              
|                                         | 33.7  | 30.2 | 22.9             
|Interest on short-term debt              | 0.3   | 0.5  | 0.6              
|                                         | 34.0  | 30.7 | 23.5             

Interest expense

Interest expense on long-term debt is net of interest income.
Interest income total $8.5 in 2006, $2.2 in 2005 and $0.4 in 2004.

Supplementary information related to the rental expense
included in Operating, selling, administrative and general expenses:

|                   | 2006  | 2005  | 2004             
|------------------ | ----- | ----- | -----------------
|                   |       |       | restated (Note 3)
|                   | $     | $     | $                
|Net rent expense   |       |       |                  
|Rent expense       | 174.0 | 158.5 | 97.1             
|Sub-leasing income | 11.5  | 11.7  | 7.0              
|                   | 162.5 | 146.8 | 90.1             

7. Income taxes

|                             | 2006  | 2005  | 2004             
|---------------------------- | ----- | ----- | -----------------
|                             |       |       | restated (Note 3)
|                             | $     | $     | $                
|Current income taxes         | 74.7  | 46.9  | 40.5             
|Future income taxes          | 26.8  | 26.4  | (12.8)           
|                             | 101.5 | 73.3  | 27.7             
|                             |       |       |                  
|Earnings before income taxes |       |       |                  
|Domestic                     | 79.7  | 96.5  | 38.4             
|Foreign                      | 218.0 | 132.0 | 45.4             
|                             | 297.7 | 228.5 | 83.8             
|                             |       |       |                  
|Current income taxes         |       |       |                  
|Domestic                     | 12.4  | 26.1  | 21.6             
|Foreign                      | 62.3  | 20.8  | 18.9             
|                             | 74.7  | 46.9  | 40.5             
|                             |       |       |                  
|Future income taxes          |       |       |                  
|Domestic                     | 4.8   | 4.4   | (9.3)            
|Foreign                      | 22.0  | 22.0  | (3.5)            
|                             | 26.8  | 26.4  | (12.8)           

The principal items which resulted in differences between the
Company's effective income tax rates and the combined statutory rates in Canada
are detailed as follows:

|                                                     | 2006   | 2005   | 2004  
|---------------------------------------------------- | ------ | ------ | ------
|                                                     | %      | %      | %     
|Combined statutory income tax rate in Canada
    (a) | 32.46  | 32.28  | 35.70 
|Impact of tax rate increases (decreases)             | (0.02) | (0.32) | 0.23  
|Other permanent differences                          | 1.65   | 0.12   | (2.88)
|Effective income tax rate                            | 34.09  | 32.08  | 33.05 

(a) The Company's combined statutory income tax rate in Canada includes the
appropriate provincial income tax rates.

12

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

7. Income taxes (continued)

The components of future income tax assets (liabilities) are
as follows:

|                                    | 2006   | 2005  
|----------------------------------- | ------ | ------
|                                    | $      | $     
|Net future income tax assets        |        |       
|Expenses deductible in future years | 17.1   | 11.5  
|Deferred credits                    | 0.2    | 1.1   
|Other                               | 1.5    | 4.5   
|                                    | 18.8   | 17.1  
|                                    |        |       
|Net future income tax liabilities   |        |       
|Expenses deductible in future years | 5.2    | 5.3   
|Property and equipment              | (21.4) | (2.6) 
|Non-capital losses                  | 3.8    | 4.1   
|Deferred credits                    | 8.9    | 8.9   
|Borrowing and share issue costs     | 1.2    | 2.0   
|Goodwill                            | (1.9)  | 0.6   
|Trademarks and licences             | (56.2) | (42.2)
|Other                               | (9.0)  | (6.8) 
|                                    | (69.4) | (30.7)

8. Net earnings per share

The following table presents the information for the
computation of basic and diluted net earnings per share, adjusted for the share
splits described in Note 18:

|                                                                            | 2006    | 2005    | 2004             
|--------------------------------------------------------------------------- | ------- | ------- | -----------------
|                                                                            |         |         | restated (Note 3)
|                                                                            | $       | $       | $                
|Basic net earnings attributable to Class A
    and B shareholders           | 196.2   | 155.2   | 56.1             
|                                                                            |         |         |                  
|Weighted average number of shares (in
    thousands)                        | 202,030 | 201,342 | 179,317          
|Dilutive effect of stock options (in
    thousands)                         | 5,632   | 5,020   | 8,060            
|Weighted average number of diluted shares (in
    thousands)                | 207,662 | 206,362 | 187,377          
|                                                                            |         |         |                  
|Basic net earnings per share available for
    Class A and B shareholders   | 0.97    | 0.77    | 0.31             
|                                                                            |         |         |                  
|Diluted net earnings per share available for
    Class A and B shareholders | 0.94    | 0.75    | 0.30             

In calculating diluted net earnings per share for 2006, 170,000 stock options
(465,000 in 2005 and nil in 2004) are excluded due to their antidilutive effect.

9. Information included in the consolidated statements of
cash flows

The changes in non-cash working capital are detailed as
follows:

|                                         | 2006   | 2005   | 2004             
|---------------------------------------- | ------ | ------ | -----------------
|                                         |        |        | restated (Note 3)
|                                         | $      | $      | $                
|Accounts receivable                      | (37.9) | (5.9)  | 6.0              
|Inventories                              | (9.9)  | (5.9)  | (7.6)            
|Prepaid expenses                         | (5.3)  | 1.8    | (6.5)            
|Accounts payable and accrued liabilities | 76.8   | 119.1  | 107.2            
|Income taxes                             | 33.5   | (63.1) | 19.7             
|                                         | 57.2   | 46.0   | 118.8            

Cash flows relating to interest and income taxes of operating
activities are detailed as follows:

|                  | 2006 | 2005  | 2004
|----------------- | ---- | ----- | ----
|                  | $    | $     | $   
|Interest paid     | 36.8 | 30.3  | 13.2
|Income taxes paid | 42.2 | 110.9 | 23.7

10. Accounts receivable

|                                                            | 2006  | 2005 
|----------------------------------------------------------- | ----- | -----
|                                                            | $     | $    
|Trade accounts receivable and vendor rebates
    receivable | 70.1  | 54.4 
|Credit and debit cards receivable                           | 66.0  | 39.4 
|Environmental costs receivable                              | 2.0   | 0.9  
|Other accounts receivable                                   | 14.9  | 15.0 
|                                                            | 153.0 | 109.7

13

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

11. Inventories

|                                   | 2006  | 2005 
|---------------------------------- | ----- | -----
|                                   | $     | $    
|Merchandise  retail               | 216.0 | 203.9
|Motor fuel                         | 84.8  | 63.6 
|Merchandise  distribution centres | 21.5  | 27.9 
|                                   | 322.3 | 295.4

12. Property and equipment

|                               |         |              |        
|------------------------------ | ------- | ------------ | -------
|                               |         |              | 2006   
|                               |         | Accumulated  |        
|                               | Cost    | depreciation | Net    
|                               | $       | $            | $      
|Land                           | 240.8   | -            | 240.8  
|Buildings                      | 202.2   | 44.3         | 157.9  
|Leasehold improvements         | 198.6   | 74.5         | 124.1  
|Equipment                      | 780.4   | 289.6        | 490.8  
|                               | 1,422.0 | 408.4        | 1,013.6
|Buildings under capital leases | 4.1     | 3.6          | 0.5    
|                               | 1,426.1 | 412.0        | 1,014.1
|                               |         |              |        
|                               |         |              | 2005   
|                               |         | Accumulated  |        
|                               | Cost    | depreciation | Net    
|                               | $       | $            | $      
|Land                           | 192.3   | -            | 192.3  
|Buildings                      | 162.7   | 46.6         | 116.1  
|Leasehold improvements         | 143.1   | 45.1         | 98.0   
|Equipment                      | 605.2   | 200.2        | 405.0  
|                               | 1,103.3 | 291.9        | 811.4  
|Buildings under capital leases | 3.7     | 3.1          | 0.6    
|                               | 1 107,0 | 295,0        | 812,0  

13. Other assets

|                               | 2006 | 2005
|------------------------------ | ---- | ----
|                               | $    | $   
|Deferred charges, net          | 28.2 | 30.7
|Environmental costs receivable | 19.8 | 21.6
|Accrued pension benefit asset  | 8.6  | 8.0 
|Deposits                       | 2.1  | 2.7 
|Other, at cost                 | 11.6 | 5.1 
|                               | 70.3 | 68.1

14. Bank indebtedness

Bank indebtedness reflects the used portion of the credit
facilities available to the Company. Available credit facilities are unused as
at April 30, 2006 and April 24, 2005, with the exception of certain letters of
guarantee.

The Company has a credit agreement consisting of a five-year
renewable operating credit, maturing in December 2008, in the amount of Cdn$50.0
available in Canadian or US dollars or as letters of guarantee not exceeding
Cdn$10.0 or the equivalent in US dollars, bearing interest at the Canadian or US
prime rate plus 0.25% to 1.0% (same in 2005) or at LIBOR plus 1.25% to 2.0%
(same in 2005), depending on whether certain financial ratios are achieved. The
operating credit is also available in the form of bankers' acceptances with
stamping fees of 1.25% to 2.0% (same in 2005), depending on whether certain
financial ratios are achieved. As at April 30, 2006, an amount of Cdn$49.1 (same
as at April 24, 2005) is available under this operating credit and the effective
interest rate is 6.25% (4.63% in 2005). The credit agreement also provides for a
five-year renewable operating credit, maturing in December 2008, in the amount
of $75.0 available in US dollars and as letters of guarantee not exceeding
$30.0, bearing interest at the US prime rate plus 0.25% to 1.0% (same in 2005)
or at LIBOR plus 1.25% to 2.0% (same in 2005) depending on whether certain
financial ratios are achieved. As at April 30, 2006, an amount of $59.5 ($62.8
as at April 24, 2005) is available under this operating credit and the effective
interest rate is 6.25% (4.63% in 2005). These credit facilities are subject to
the same guarantees and restrictive covenants which apply to the term loans
described in Note 16.

15. Accounts payable and accrued liabilities

|                                      | 2006  | 2005 
|------------------------------------- | ----- | -----
|                                      | $     | $    
|Accounts payable and accrued expenses | 494.1 | 435.4
|Sales and other taxes payable         | 61.9  | 53.2 
|Salaries and social benefits          | 49.2  | 45.9 
|Deferred credits                      | 11.0  | 9.1  
|Environmental costs                   | 9.9   | 7.5  
|Other                                 | 55.7  | 58.5 
|                                      | 681.8 | 609.6

14

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

16. Long-term debt

|                                                                                                                                                                           | 2006  | 2005 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----- | -----
|                                                                                                                                                                           | $     | $    
|Subordinated unsecured debt (a)                                                                                                                                            | 350.0 | 350.0
|Secured term loans (b)                                                                                                                                                     |       |      
|Term loan "A"                                                                                                                                                              | 19.5  | 24.1 
|Term loan "B"                                                                                                                                                              | 147.0 | 148.5
|Note payable, secured by the assets of
    certain stores, 8.75%, repayable in monthly instalments, maturing in 2019                                                       | 5.2   | 5.4  
|Obligations related to buildings under
    capital leases, rates varying from 6.89% to 13.25% (5.9% to 13.25% in 2005),
    payable on various dates until 2019            | 2.3   | 2.5  
|Mortgage loans secured by land and buildings,
    rates varying from 7.0% to 8.0% (same in 2005), payable in monthly
    instalments, maturing on various dates until 2010 | 0.1   | 0.2  
|Note payable without interest                                                                                                                                              | -     | 0.2  
|                                                                                                                                                                           | 524.1 | 530.9
|Current portion of long-term debt                                                                                                                                          | 8.0   | 7.0  
|                                                                                                                                                                           | 516.1 | 523.9

(a) Subordinated unsecured debt:

Subordinated unsecured debt, maturing December 15, 2013,
bearing interest at a rate of 7.5% and redeemable under certain conditions as of
December 15, 2008.

The total amount of the loan is subject to interest rate
swaps (see Note 22).

The subordinated unsecured debt agreement imposes certain
restrictions on business acquisitions and the payment of dividends.

(b) Secured term loans:

- 

> Term loan "A", maturing on December 17,
>   2008, payable in quarterly instalments increasing gradually from 2.5% of the
>   balance of the loan to 7.5% of the balance of the loan from July 2008, bearing
>   interest at the Canadian prime rate plus 0.25% to 1.0% (same in 2005) or the
>   LIBOR rate plus 1.25% to 2.0% (same in 2005), depending on whether certain
>   financial ratios are achieved. As at April 30, 2006, the effective interest
>   rate is 6.25% (4.63% as at April 24, 2005);

- 

> Term loan "B", maturing on December 17, 2010, payable in
>   quarterly instalments of 0.25% of the balance of the loan for the first six
>   years and in quarterly instalments of 23.5% of the balance of the loan for the
>   seventh year, bearing interest at the prime US rate plus 0.75% (same in 2005)
>   or the LIBOR rate plus 1.75% (same in 2005). As at April 30, 2006, the
>   effective interest rate is 6.75% (4.75% as at April 24, 2005).

Substantially all of the Companys
assets have been pledged to secure these term loans.

Under the credit agreement, the
Company must meet certain commitments and achieve certain financial ratios.
Furthermore, the credit agreement imposes certain restrictions on business
acquisitions and payment of dividends and, if a certain ratio is not achieved,
on capital spending.

On December 17, 2003, the Company concluded a new credit
agreement. Consequently, the deferred financing costs relating to the previous
agreement in the amount of $2.1 were written off. In addition, in 2004, the
Company repaid its debt with proceeds from sale and leaseback transactions. The
portion of deferred financing costs in the amount of $7.1 relating to the repaid
debt was also written off.

Instalments on long-term debt for the next years are as
follows:

|                                                        | Obligations related |            
|------------------------------------------------------- | ------------------- | -----------
|                                                        | to buildings under  |            
|                                                        | capital leases      | Other loans
|                                                        | $                   | $          
|2007                                                    | 0.8                 | 7.6        
|2008                                                    | 0.6                 | 8.2        
|2009                                                    | 0.5                 | 8.9        
|2010                                                    | 0.4                 | 1.9        
|2011                                                    | 0.4                 | 141.3      
|2012 and subsequent years                               | 1.7                 | 353.9      
|                                                        | 4.4                 |            
|Interest expense included in minimum lease
    payments | 2.1                 |            
|                                                        | 2.3                 |            

15

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

17. Deferred credits and other
liabilities

|                                     | 2006  | 2005
|------------------------------------ | ----- | ----
|                                     | $     | $   
|Asset retirement obligations (a)     | 31.2  | 17.9
|Deferred credits                     | 19.6  | 16.3
|Provision for site restoration costs | 18.1  | 20.9
|Accrued pension benefit liability    | 8.4   | 5.8 
|Provision for workers' compensation  | 8.0   | 5.7 
|Other liabilities                    | 41.9  | 23.0
|                                     | 127.2 | 89.6

(a) Asset retirement obligations relate to estimated future costs to remove
underground motor fuel storage tanks and are based on the Companys prior
experience in removing these tanks, estimated tank useful life, lease terms for
those tanks installed on leased properties, external estimates and governmental
regulatory requirements. To determine the initial recorded liability, the future
estimated cash flows have been discounted at rates of 9% and 10%, representing
the Companys credit-adjusted risk-free rates at the time the costs have been
estimated and revised. The total undiscounted amount of estimated cash flows to
settle the asset retirement obligations is approximately $68.1 and is expected
to be incurred over the next 40 years. Should changes occur in estimated future
removal costs, tank useful lives, lease terms or governmental regulatory
requirements, revisions to the liability could be made.

The reconciliation of the Companys liability for the asset
retirement obligations related to the removal of its underground motor fuel
storage tanks is as follows:

|                                     | 2006  | 2005 
|------------------------------------ | ----- | -----
|                                     | $     | $    
|Balance, beginning of year           | 22.1  | 15.9 
|Liabilities incurred                 | 0.4   | 0.1  
|Liabilities settled                  | (1.3) | (0.5)
|Accretion expense                    | 1.9   | 1.9  
|Business acquisitions                | 0.5   | 3.7  
|Revision of estimations              | 11.8  | -    
|Effect of exchange rate fluctuations | 0.5   | 1.0  
|Balance, end of year                 | 35.9  | 22.1 

Of the total liability recorded in the consolidated balance
sheets as of April 30, 2006 and April 24, 2005, $31.2 and $17.9, respectively,
are included in Deferred credits and other liabilities and the remainder is
included in Accounts payable and accrued liabilities.

18. Capital stock

Authorized

Unlimited number of shares without par value

First and second preferred shares
issuable in series, non-voting, ranking prior to other classes of shares with
respect to dividends and payment of capital upon dissolution. The Board of
Directors is authorized to determine the designation, rights, privileges,
conditions and restrictions relating to each series of shares prior to their
issuance.

Class A multiple voting and
participating shares, ten votes per share except for certain situations which
provide for only one vote per share, convertible into Class B subordinate voting
shares on a share-for-share basis at the holder's option. Under the articles of
amendment, no new Class A multiple voting share can be issued.

Class B subordinate voting and
participating shares, convertible automatically into Class A multiple voting
shares on a share-for-share basis upon the occurrence of certain events.

The order of priority for the payment of dividends is as follows:

- first preferred shares;
- second preferred shares;
- Class B subordinate voting shares and Class A multiple voting shares,
  ranking pari passu.

16

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

18. Capital stock (continued)

Issued and fully paid

The changes in number of outstanding shares are as follows:

|                                              |                  | 2006  |                  | 2005 
|--------------------------------------------- | ---------------- | ----- | ---------------- | -----
|                                              | Number of shares | $     | Number of shares | $    
|Class A multiple voting shares                |                  |       |                  |      
|Balance, beginning of year                    | 56,594,692       | 8.0   | 57,041,722       | 8.1  
|Conversion into Class B shares                | (206,040)        | -     | (447,030)        | (0.1)
|Balance, end of year                          | 56,388,652       | 8.0   | 56,594,692       | 8.0  
|                                              |                  |       |                  |      
|Class B subordinate voting shares             |                  |       |                  |      
|Balance, beginning of year                    | 145,375,660      | 342.8 | 140,490,082      | 333.4
|Issued as part of a previous acquisition      | 1,630            | -     | 548              | -    
|Issued on conversion of Class A shares        | 206,040          | -     | 447,030          | 0.1  
|Stock options exercised for cash              | 68,104           | 0.2   | 4,438,000        | 9.3  
|Balance, end of year                          | 145,651,434      | 343.0 | 145,375,660      | 342.8
|                                              |                  |       |                  |      
|Total issued and fully paid                   |                  | 351.0 |                  | 350.8
|                                              |                  |       |                  |      
|                                              |                  |       |                  | 2004 
|                                              |                  |       | Number of shares | $    
|Class A multiple voting shares                |                  |       |                  |      
|Balance, beginning of year                    |                  |       | 57,097,648       | 8.1  
|Conversion into Class B shares                |                  |       | (55,926)         | -    
|Balance, end of year                          |                  |       | 57,041,722       | 8.1  
|                                              |                  |       |                  |      
|Class B subordinate voting shares             |                  |       |                  |      
|Balance, beginning of year                    |                  |       | 112,004,270      | 162.0
|Issued as part of the acquisition of Circle K |                  |       | 27,111,076       | 168.8
|Issued as part of a previous acquisition      |                  |       | 10               | -    
|Issued on conversion of Class A shares        |                  |       | 55,926           | -    
|Stock options exercised for cash              |                  |       | 1,318,800        | 2.6  
|Balance, end of year                          |                  |       | 140,490,082      | 333.4
|                                              |                  |       |                  |      
|Total issued and fully paid                   |                  |       |                  | 341.5

During the year ended April 24, 2005, the Company split all
of its issued and outstanding Class A and B shares on a two-for-one basis. All
share and per-share information in these consolidated financial statements has
been adjusted retroactively to reflect stock split.

On December 17, 2003, the Company exchanged 27,111,076
warrants for Class B shares on a share-for-share basis. These warrants were
issued on October 6, 2003 at a price of Cdn$8.25 each for a total consideration
of $168.8. The issue costs, net of related future income taxes, amounted to
$1.6.

19. Stock-based compensation and other stock-based payments

The Company has a stock option plan (the plan) under which it
may grant up to 16,892,000 stock options for the purchase of Class B subordinate
voting shares of the Company.

Stock options have up to a ten-year term, vest 20% on the
date of the grant and cumulatively thereafter on each anniversary date of the
grant and are exercisable at the designated market price. The grant price of
each stock option shall not be set below the market price of the Class B shares
on the Toronto Stock Exchange on the date of the grant. Each stock option is
exercisable into one Class B share of the Company at the price specified in the
terms of the stock option.

The table below presents the status of the Company's stock
option plan as at April 30, 2006, April 24, 2005 and April 25, 2004 and the
changes therein during the years then ended:

|                                       |                 | 2006             |                 | 2005            
|-------------------------------------- | --------------- | ---------------- | --------------- | ----------------
|                                       | Number of stock | Weighted average | Number of stock | Weighted average
|                                       | options         | exercise price   | options         | exercise price  
|                                       |                 | Cdn$             |                 | Cdn$            
|Outstanding, beginning of year         | 8,745,400       | 6.93             | 12,626,200      | 5.05            
|Granted                                | 580,100         | 18.36            | 605,000         | 15.92           
|Exercised                              | (68,104)        | 4.13             | (4,438,000)     | 2.79            
|Cancelled                              | (5,016)         | 14.33            | (47,800)        | 6.74            
|Outstanding, end of year               | 9,252,380       | 7.66             | 8,745,400       | 6.93            
|                                       |                 |                  |                 |                 
|Exercisable stock options, end of year | 7,674,976       |                  | 6,312,000       |                 

17

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

19. Stock-based compensation and other stock-based payments (continued)

|                                       |                 | 2004            
|-------------------------------------- | --------------- | ----------------
|                                       | Number of stock | Weighted average
|                                       | options         | exercise price  
|                                       |                 | Cdn$            
|Outstanding, beginning of year         | 12,313,000      | 4.07            
|Granted                                | 1,680,000       | 10.29           
|Exercised                              | (1,318,800)     | 2.65            
|Cancelled                              | (48,000)        | 4.04            
|Outstanding, end of year               | 12,626,200      | 5.05            
|                                       |                 |                 
|Exercisable stock options, end of year | 8,742,640       |                 

The following table presents information on the stock options
outstanding and exercisable as at April 30, 2006:

|                |                   | Options outstanding |          |                   | Options exercisable
|--------------- | ----------------- | ------------------- | -------- | ----------------- | -------------------
|                | Number of         | Weighted average    | Weighted | Number of         | Weighted           
|                | stock options     | remaining           | average  | stock options     | average            
|Range of        | outstanding as at | contractual life    | exercise | exercisable as at | exercise           
|exercise prices | April 30, 2006    | (years)             | price    | April 30, 2006    | price              
|Cdn$            |                   |                     | Cdn$     |                   | Cdn$               
|2 - 4           | 2,908,000         | 4.40                | 2.68     | 2,908,000         | 2.68               
|6 - 8           | 3,707,100         | 6.01                | 7.35     | 3,535,360         | 7.35               
|8 - 14          | 1,595,800         | 7.63                | 10.83    | 930,320           | 10.81              
|14 - 20         | 921,480           | 8.87                | 17.26    | 277,296           | 17.25              
|20 - 26         | 120,000           | 9.64                | 22.50    | 24,000            | 22.50              
|                | 9,252,380         |                     |          | 7,674,976         |                    

For 2004, the Company did not record any compensation cost.
If the compensation cost had been determined using the fair value method at the
date of attribution of stock options granted beginning on April 29, 2002 to
employees, net earnings and net earnings per share information would have been
reduced to the pro forma shown in the following table:

|                               |           | 2004     
|------------------------------ | --------- | ---------
|                               | Disclosed | Pro forma
|                               | $         | $        
|Net earnings                   | 56.1      | 54.2     
|Basic net earnings per share   | 0.31      | 0.30     
|Diluted net earnings per share | 0.30      | 0.29     

The pro forma impact on net earnings for the period is not
representative of the pro forma net earnings of future periods because it does
not take into account the pro forma compensation relating to options granted
prior to April 29, 2002.

The fair value of stock options granted is estimated at the
grant date using the Black & Scholes option pricing model on the basis of the
following weighted average assumptions for the stock options granted during the
year:

|                               | 2006     | 2005    | 2004   
|------------------------------ | -------- | ------- | -------
|Expected dividends (per share) | Cdn$0.10 | None    | None   
|Expected volatility            | 35%      | 35%     | 30%    
|Risk-free interest rate        | 3.92%    | 4.26%   | 4.45%  
|Expected life                  | 8 years  | 8 years | 8 years

The weighted average fair value of stock options granted in
the year ended April 30, 2006 is Cdn$8.65 (Cdn$7.72 in 2005 and Cdn$4.61 in
2004).

For the year ended April 30, 2006, compensation cost charged
to consolidated statement of earnings amount to $3.8 ($2.5 in 2005).

Deferred Share Unit Plan

On July 13, 2004, the Company adopted a Deferred Share Unit
Plan for the benefit of its external directors allowing them to receive all or a
portion of their annual compensation in the form of Deferred Share Units (DSUs).
A DSU is a notional unit, equivalent in value to the Companys Class B share.
Upon resignation from the Board of Directors, participants are entitled to
receive the payment of their cumulated DSUs either a) in the form of cash based
on the price of the Companys Class B shares as traded on the open market on the
date of payment, or b) in Class B shares bought by the Company on the open
market on behalf of the Participant.

The DSU expense and the related liability are recorded at the
grant date. The liability is adjusted periodically to reflect any increase in
the market value of the Class B shares. As at April 30, 2006, the Company has a
total of 21,108 DSUs outstanding (14,665 as at April 24, 2005).

Share Appreciation Rights Plan

The Board of Directors approved on July 13, 2004 a Share
Appreciation Rights Plan for officers and key employees of the Company. The
amount payable to the Participant is equal to the difference between the market
value of the Companys Class B shares at exercise and its value at the grant
date and is payable in cash. The grant agreement describes the exercise period,
the value of the shares at grant date and the duration of the plan for each
participant. No share appreciation right is granted as at April 30, 2006.

18

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

20. Employee future benefits

The Company has a number of funded and unfunded defined
benefit and defined contribution plans that provide retirement benefits to
certain employees. Its defined benefit plans are based on years of service and
on the consecutive highest five years average salary.

Total cash payments for employee future benefits consist of
cash contributed by the Company to its funded pension plans, cash payments
directly to beneficiaries for its unfunded pension plans and cash contributed to
its defined contribution plans and amount to $3.3 for 2006 ($3.6 for 2005).

Defined benefit plans

The Company measures its accrued benefit obligation and the
fair value of plan assets for accounting purposes the last Sunday of April of
each year. The most recent actuarial valuation of the pension plans for funding
purposes was as of January 1, 2005 and the next required valuation will be as of
January 1, 2008.

Information about the Company's defined benefit plans, in
aggregate, is as follows:

|                                     | 2006  | 2005 
|------------------------------------ | ----- | -----
|                                     | $     | $    
|Accrued benefit obligation           |       |      
|Balance, beginning of year           | 29.2  | 23.1 
|Current service cost                 | 0.7   | 0.5  
|Interest cost                        | 1.7   | 1.5  
|Benefits paid                        | (1.7) | (1.7)
|Actuarial losses                     | -     | 3.3  
|Effect of exchange rate fluctuations | 3.0   | 2.5  
|Balance, end of year                 | 32.9  | 29.2 
|                                     |       |      
|                                     | 2006  | 2005 
|                                     | $     | $    
|Plans assets                         |       |      
|Fair value, beginning of year        | 21.4  | 19.6 
|Actual return on plans assets        | 0.6   | 1.0  
|Employees contributions              | 0.1   | 0.1  
|Benefits paid                        | (1.3) | (1.3)
|Effect of exchange rate fluctuations | 2.1   | 2.0  
|Fair value, end of year              | 22.9  | 21.4 

Reconciliation of the funded status of the benefit plans to the amount
recorded in the consolidated financial statements:

|                                   | 2006   | 2005 
|---------------------------------- | ------ | -----
|                                   | $      | $    
|Fair value of plans assets         | 22.9   | 21.4 
|Accrued benefit obligation         | 32.9   | 29.2 
|Funded status-plan deficit         | (10.0) | (7.8)
|Unamortized net actuarial loss     | 12.1   | 10.9 
|Unamortized transitional net asset | (2.5)  | (2.8)
|Unamortized past service cost      | 1.8    | 1.9  
|Accrued benefit asset              | 1.4    | 2.2  

As at April 30, 2006, the accrued benefit obligation for
unfunded pension plans amount to $11.7 ($10.3 in 2005).

The accrued benefit asset is included in the Companys
balance sheets as follows:

|                                                         | 2006                           | 2005 
|-------------------------------------------------------- | ------------------------------ | -----
|                                                         | $                              | $    
|Other assets                                             | 8.6                            | 8.0  
|Deferred credits and other liabilities                   | (7.2)                          | (5.8)
|Accrued benefit asset                                    | 1.4                            | 2.2  
|                                                         |                                |      
|As of the measurement date, plans assets
    consist of: |                                |      
|                                                         | Percentage of
    plans assets
|                                                         | 2006                           | 2005 
|                                                         | %                              | %    
|Assets category                                          |                                |      
|Equity securities                                        | 32.1                           | 28.5 
|Debt securities                                          | 67.9                           | 71.5 
|Total                                                    | 100.0                          | 100.0

19

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

20. Employee future benefits (continued)

The Company's pension benefit expense for the year is determined as follows:

|                                                        |                     |             | 2006                 
|------------------------------------------------------- | ------------------- | ----------- | ---------------------
|                                                        | Incurred during the | Adjustments | Recognized during    
|                                                        | year                | (a)         | the year             
|                                                        | $                   | $           | $                    
|Current service cost, net of employee
    contributions | 0.6                 | -           | 0.6                  
|Interest cost                                           | 1.7                 | -           | 1.7                  
|Actual return on plan assets                            | (0.6)               | (0.9)       | (1.5)                
|Amortization of the net transitional asset              | -                   | (0.5)       | (0.5)                
|Net actuarial losses                                    | -                   | 0.8         | 0.8                  
|Amortization of past service cost                       | -                   | 0.3         | 0.3                  
|Pension expense for the year                            | 1.7                 | (0.3)       | 1.4                  
|                                                        |                     |             |                      
|                                                        |                     |             | 2005                 
|                                                        | Incurred during     | Adjustments | Recognized during the
|                                                        | the year            | (a)         | year                 
|                                                        | $                   | $           | $                    
|Current service cost, net of employee
    contributions | 0.5                 | -           | 0.5                  
|Interest cost                                           | 1.5                 | -           | 1.5                  
|Actual return on plan assets                            | (1.0)               | (0.4)       | (1.4)                
|Amortization of the net transitional asset              | -                   | (0.5)       | (0.5)                
|Net actuarial losses                                    | 3.3                 | (2.8)       | 0.5                  
|Amortization of past service cost                       | -                   | 0.2         | 0.2                  
|Pension expense for the year                            | 4.3                 | (3.5)       | 0.8                  
|                                                        |                     |             |                      
|                                                        |                     |             | 2004                 
|                                                        | Incurred during     | Adjustments | Recognized during the
|                                                        | the year            | (a)         | year                 
|                                                        | $                   | $           | $                    
|Current service cost, net of employee
    contributions | 0.4                 | -           | 0.4                  
|Interest cost                                           | 1.4                 | -           | 1.4                  
|Actual return on plan assets                            | (2.5)               | 1.2         | (1.3)                
|Amortization of the net transitional asset              | -                   | (0.4)       | (0.4)                
|Net actuarial losses                                    | 1.3                 | (0.7)       | 0.6                  
|Amortization of past service cost                       | -                   | 0.2         | 0.2                  
|Pension expense for the year                            | 0.6                 | 0.3         | 0.9                  

(a)

The significant actuarial assumptions which management
considers the most likely to be used to determine the accrued benefit
obligations and the pension expense are the following:

|Accrued benefit obligation:             |      |      |     
|--------------------------------------- | ---- | ---- | ----
|                                        | 2006 | 2005 |     
|                                        | %    | %    |     
|Discount rate                           | 5.75 | 5.75 |     
|Rate of compensation increase           | 4.00 | 4.00 |     
|                                        |      |      |     
|Pension expense:                        |      |      |     
|                                        | 2006 | 2005 | 2004
|                                        | %    | %    | %   
|Discount rate                           | 5.75 | 6.25 | 6.50
|Expected rate of return on plans assets | 7.00 | 7.00 | 7.00
|Rate of compensation increase           | 4.00 | 4.00 | 4.00

Defined contribution plans

The Company's total pension expense under its defined
contribution plans for the year 2006 is $2.8 ($3.1 in 2005 and $0.7 in 2004).

Deferred compensation plan  United States operations

The Company sponsors a deferred compensation plan that allows
certain employees in its U.S. operations to defer up to 25% of their base salary
and 100% of their cash bonuses for any given year. Interest accrues on the
deferral and amounts due to the participants are generally payable on
retirement, except in certain limited circumstances. Obligations under this plan
amount to $4.0 as at April 30, 2006 ($1.9 as at April 24, 2005) and are included
in Deferred credits and other liabilities.

20

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

21. Environment

The Company is subject to Canadian and American legislations
governing the storage, handling and sale of motor fuel and related products. The
Company considers that it is generally in compliance with current environmental
legislations.

The Company has an on-going training program for its
employees on environmental issues which includes preventive site testing and
site restoration in cooperation with regulatory authorities. The Company also
examines its motor fuel equipment annually to make the necessary investments.

In all U.S. states in which the Company operates, except
Michigan, Iowa, Florida, Texas and Washington State, there is a trust fund to
cover the cost of certain rehabilitation and removing of motor fuel tanks. These
state funds provide insurance for motor fuel facilities operations to cover the
cost of cleaning up damages to the environment caused by the usage of
underground motor fuel equipment. Underground motor fuel storage tank
registration fees and a motor fuel tax in each of the states finance the trust
funds. The Company pays the registration fees and remits the sales taxes to the
states where it is a member of the trust fund. Insurance coverage is different
in the various states.

In order to provide for the above-mentioned restoration
costs, the Company has recorded a $28.0 provision for environmental costs as at
April 30, 2006 ($28.4 as at April 24, 2005). Of this amount, $9.9 ($7.5 as at
April 24, 2005) is included in Accounts payable and accrued liabilities and the
remainder is included in Deferred credits and other liabilities. Furthermore,
the Company has recorded an amount of $21.8 for environmental costs receivable
as at April 30, 2006 ($22.5 as at April 24, 2005), of which $2.0 ($0.9 as at
April 24, 2005) is included in Accounts receivable, the remainder being included
in Other assets.

22. Financial instruments



Management of interest rate risk

The Company has entered into interest rate swaps to manage
interest rate fluctuations. It has agreed to swap the amount of the difference
between the variable interest rate and the fixed rate, calculated based on the
reference amounts. These interest rate swaps have been designated as a fair
value hedge of the subordinated unsecured debt.

The amounts outstanding at year end are as follows:

|Maturity (a)  | Reference | Pays/receives  | Fixed rate | Variable rate
|------------- | --------- | -------------- | ---------- | -------------
|              | $         |                | %          |              
|December 2013 | 100.0     | pays variable  | 7.5        | LIBOR 6 month
|              |           | receives fixed |            | plus 3.03%   
|December 2013 | 100.0     | pays variable  | 7.5        | LIBOR 6 month
|              |           | receives fixed |            | plus 2.98%   
|December 2013 | 150.0     | pays variable  | 7.5        | LIBOR 6 month
|              |           | receives fixed |            | plus 2.89%   

(a)

Fair value of financial instruments

The fair value of cash and cash equivalents, accounts
receivable and accounts payable and accrued liabilities is comparable to their
carrying amount given that they will mature in less than one year.

The fair value of the temporary investments, which bear
interest at rates varying from 3.90% to 4.22%, is $21.4 as per the mark to
market as at April 30, 2006.

With the exception of the subordinated unsecured debt, there
is no material difference between the fair value and the carrying amount of the
Company's long-term debt as at April 30, 2006 and April 24, 2005, given that the
largest loans bear interest at a floating rate.

The fair value of the subordinated unsecured debt is $357.9
as at April 30, 2006 ($359.2 as at April 24, 2005) and is estimated based on the
discounted cash flows of the debt at the Companys estimated incremental
borrowing rates for debt of the same remaining maturities.

The fair value of the interest rate swaps, as determined by
the Company's banks based on quoted market prices for similar instruments, is
$27.0 payable by the Company ($10.9 payable by the Company as at April 24,
2005).

Credit risk

The Companys exposure to concentrations of credit and
non-collection risks is limited considering the nature of the Companys
activities and its counterparties.

23. Contractual obligations

Minimum lease payments

As at April 30, 2006, the Company has entered into lease
agreements expiring on various dates until 2031 which call for aggregate minimum
lease payments of $1,369.1 for the rental of commercial space, equipment and a
warehouse. Several of these leases contain renewal options and certain sites are
subleased to franchise-holders. The minimum lease payments for the next years
are $159.6 in 2007, $142.3 in 2008, $119.4 in 2009, $106.0 in 2010, $93.1 in
2011 and a total of $748.7 for 2012 and the subsequent years.

21

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

23. Contractual obligations (continued)

Purchase commitments

The Company has concluded agreements to acquire, during the
next years, franchise rights and equipment which call for aggregate payments of
$7.8. The minimum payments for the next years are $3.5 in 2007, $0.5 in 2008,
$1.3 in 2009, $0.6 in 2010 and 2011 and a total of $1.3 for 2012 and the
subsequent years.

Moreover, the Company has entered into various products
purchase agreements that require it to purchase minimum amounts or quantities of
merchandise and motor fuel annually. The Company has generally exceeded such
minimum requirements in the past and expects to continue doing so for the
foreseeable future. Failure to satisfy the minimum purchase requirements could
result in termination of the contracts, change in pricing of the products,
payments to the applicable providers of a predetermined percentage of the
commitments and repayments of a portion of rebates received.

24. Contingencies and guarantees

Contingencies

Various claims and legal proceedings have been initiated
against the Company in the normal course of its operations that relate to human
resources and the environment. In management's opinion, these claims and
proceedings are unfounded. Although the outcome of these proceedings cannot be
determined with certainty, management estimates that any payments resulting from
their outcome are not likely to have a substantial negative impact on the
Company's results and financial position.

Guarantees

Sub-lease agreements

The Company entered into a number of agreements to sub-lease
premises to third parties. Under some of these agreements, the Company retains
ultimate responsibility to the landlord for payment of amounts under the lease
agreements should the sub-lessees fail to pay. The total future lease payments
under such agreements are approximately $1.9. Historically, the Company has not
made any significant payments in connection with these indemnification
provisions.

Other indemnification agreements

In the normal course of its business, the Company provides
indemnifications which vary in duration and given the nature of these
indemnifications, the Company is unable to reasonably estimate its maximum
potential liability payable to third parties. Historically, the Company has not
made any significant payments in connection with these indemnification
provisions.

25. Segmented information

The Company operates convenience stores in Canada and in the
United States. It essentially operates in one reportable segment, the sale of
goods for immediate consumption and motor fuel through corporate stores or
franchise operations. It operates a convenience store chain under several
banners, including Couche-Tard, Mac's and Circle K. Revenues from outside
sources mainly fall into two categories: merchandise and services and motor
fuel.

Information on the principal revenue classes as well as geographic
information is as follows:

|                                        |         |         | 2006     |         |         | 2005   
|--------------------------------------- | ------- | ------- | -------- | ------- | ------- | -------
|                                        | Canada  | U.S.    | Total    | Canada  | U.S.    | Total  
|                                        | $       | $       | $        | $       | $       | $      
|External customer revenues(a)           |         |         |          |         |         |        
|Merchandise and services                | 1,426.7 | 2,812.0 | 4,238.7  | 1,239.5 | 2,564.7 | 3,804.2
|Motor fuel                              | 873.7   | 5,044.9 | 5,918.6  | 664.8   | 3,567.8 | 4,232.6
|                                        | 2,300.4 | 7,856.9 | 10,157.3 | 1,904.3 | 6,132.5 | 8,036.8
|                                        |         |         |          |         |         |        
|Gross profit                            |         |         |          |         |         |        
|Merchandise and services                | 483.1   | 932.3   | 1,415.4  | 415.7   | 834.9   | 1,250.6
|Motor fuel                              | 63.6    | 312.5   | 376.1    | 51.3    | 255.9   | 307.2  
|                                        | 546.7   | 1,244.8 | 1,791.5  | 467.0   | 1,090.8 | 1,557.8
|                                        |         |         |          |         |         |        
|Property and equipment and goodwill (a) | 464.2   | 795.7   | 1,259.9  | 407.2   | 629.7   | 1,036.9

22

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

25. Segmented information (continued)

|                                        |         |         | 2004             
|--------------------------------------- | ------- | ------- | -----------------
|                                        |         |         | restated (Note 3)
|                                        | Canada  | U.S.    | Total            
|                                        | $       | $       | $                
|External customer revenues(a)           |         |         |                  
|Merchandise and services                | 1,130.6 | 1,195.3 | 2,325.9          
|Motor fuel                              | 507.1   | 1,562.3 | 2,069.4          
|                                        | 1,637.7 | 2,757.6 | 4,395.3          
|                                        |         |         |                  
|Gross profit                            |         |         |                  
|Merchandise and services                | 367.4   | 389.7   | 757.1            
|Motor fuel                              | 47.3    | 110.1   | 157.4            
|                                        | 414.7   | 499.8   | 914.5            
|                                        |         |         |                  
|Property and equipment and goodwill (a) | 344.1   | 524.2   | 868.3            

(a)

26. Hurricanes - Florida

During 2006, Florida and the Gulf of Mexico region was
affected by three hurricanes, which resulted in some damages to certain of the
Companys sites. The Company estimates that assets and leased properties that
were damaged have a total replacement value of approximately $16.7, which will
result in a net claim of about $13.0. The net book value of the damaged assets
is lower than the net claim. As at April 30, 2006, the Company has received $2.0
in insurance proceeds. The Company does not expect these hurricanes to have a
significant effect on its financial position and operating results.

During 2005, certain areas of the Companys business in
Florida experienced damages resulting from four hurricanes. Assets and leased
properties that were damaged have a total replacement value of $23.5, which
resulted in a net claim of about $16.6. The net book value of the damaged assets
is lower than the net claim. As at April 30, 2006, the Company has received
$15.9 in insurance proceeds. The Company considers that these hurricanes had no
significant effect on the its financial position and operating results.

27. Subsequent events

Business acquisitions

On June 12, 2006, the Company finalized, with Spectrum
Holding, Inc., the acquisition of 90 sites operating under the Spectrum banner
in the states of Alabama and Georgia, United States. This acquisition was
settled for a total cash consideration of $130.0 financed from the Companys
available cash.

On June 12, 2006, the Company signed an agreement with Moore
Oil Company, LLC to acquire a network of 24 sites operating under the
Stop-n-Save banner in the Monroe area of Louisiana, United States. Of these 24
stores, six are operated by the company, 17 are operated by independent store
operators and one is currently under construction. The transaction amount will
be determined on closing.

Income taxes

On June 9, 2006, the Government of Québec adopted Bill 15 in
the National Assembly of Québec, regarding amendments to the Taxation Act and
other legislative provisions. As a result, an unusual retroactive income tax
expense of approximately $9.8, excluding other associated expenses, will be
recognized in first quarter of fiscal 2007. This modification will not have a
significant impact on the effective income tax rate of the Company in the
future.

28. Comparative figures

Certain comparative figures have been reclassified to comply
with the presentation adopted in the current year.

29. Reconciliation of Canadian and United States Generally
Accepted Accounting Principles

The consolidated financial statements have been prepared in
accordance with Canadian GAAP, which differ in certain respects from those
principles and practices that the Company would have followed had its
consolidated financial statements been prepared in accordance with generally
accepted accounting principles in the United States (U.S. GAAP).

23

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

29. Reconciliation of Canadian and United States Generally
Accepted Accounting Principles (continued)

The material differences between Canadian and U.S. GAAP
affecting the Companys consolidated financial statements are detailed as
follow:

A. Consolidated financial statements

Consolidated Statement of Earnings

|                                                                             | 2006  | 2005  | 2004    
|---------------------------------------------------------------------------- | ----- | ----- | --------
|                                                                             |       |       | restated
|                                                                             |       |       | (Note 3)
|                                                                             | $     | $     | $       
|Net earnings in accordance with Canadian GAAP                                | 196.2 | 155.2 | 56.1    
|                                                                             |       |       |         
|Adjustments with respect to                                                  |       |       |         
|Derivative financial instruments (a)                                         | -     | -     | 0.5     
|Pension expense (b)                                                          | -     | (0.1) | 0.1     
|Sale and leaseback transactions (c)                                          | (5.7) | (5.8) | (5.6)   
|Stock-based compensation (d)                                                 | 3.8   | 2.5   | -       
|Deferred charges and other assets (e)                                        | 0.3   | 0.3   | 0.3     
|Supplier rebates and other supplier payments (g)                             | -     | (0.6) | (4.9)   
|Depreciation and amortization of fixed assets (k)                            | -     | -     | (1.5)   
|Tax effect of the above adjustments                                          | 2.3   | 3.2   | 4.4     
|Cumulative effect of accounting changes                                      |       |       |         
|Depreciation and amortization of fixed assets
    (net of taxes of $0.2) (k) | -     | 0.4   | -       
|Asset retirement obligations (net of taxes of
    $0.8) (f)                  | -     | -     | (1.5)   
|                                                                             | 0.7   | (0.1) | (8.2)   
|Net earnings in accordance with U.S. GAAP                                    | 196.9 | 155.1 | 47.9    
|                                                                             |       |       |         
|Net earnings per share in accordance with
    U.S. GAAP (i)                  |       |       |         
|Basic                                                                        | 0.97  | 0.77  | 0.27    
|Diluted                                                                      | 0.95  | 0.75  | 0.26    

|                                                           |               |           |               |          
|---------------------------------------------------------- | ------------- | --------- | ------------- | ---------
|Consolidated Balance Sheets                               
|                                                           |               |           |               |          
|                                                           |               | 2006      |               | 2005     
|                                                           | Canadian GAAP | U.S. GAAP | Canadian GAAP | U.S. GAAP
|                                                           | $             | $         | $             | $        
|ASSETS                                                     |               |           |               |          
|Fixed assets (c) (e)                                       | 1,014.1       | 1,114.0   | 812.0         | 916.2    
|Goodwill (g)                                               | 245.8         | 245.2     | 224.9         | 224.3    
|Other assets (b) (e)                                       | 70.3          | 70.0      | 68.1          | 68.2     
|Long-term future income taxes (c)                          | 0.6           | 12.5      | 1.6           | 11.1     
|                                                           |               |           |               |          
|LIABILITIES                                                |               |           |               |          
|Accounts payable and accrued liabilities (d)               | 681.8         | 692.2     | 609.6         | 619.2    
|Long-term debt (a) (c)                                     | 516.1         | 621.2     | 523.9         | 643.7    
|Deferred credits and other liabilities (a)
    (b) (c)     | 127.2         | 156.9     | 89.6          | 103.7    
|Long-term future income taxes (b) (e)                      | 70.0          | 67.4      | 32.3          | 30.0     
|                                                           |               |           |               |          
|SHAREHOLDERS' EQUITY                                       |               |           |               |          
|Capital stock (d) (h)                                      | 351.0         | 348.6     | 350.8         | 348.2    
|Contributed surplus (d)                                    | 9.4           | 0.6       | 5.6           | 0.6      
|Retained earnings (b) (c) (d) (e) (g) (h)                  | 505.0         | 488.9     | 317.5         | 300.7    
|Cumulative translation adjustments (b) (d)
    (e) (g) (h) | 100.6         | -         | 59.3          | -        
|Accumulated other comprehensive loss (j)                   | -             | 96.2      | -             | 55.7     

a) Derivative financial instruments

On April 30, 2001, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments and
Hedging Activities" and SFAS No. 138, "Accounting for Certain Derivative
Instruments and Certain Hedging Activities". These standards require all
derivative financial instruments to be recorded on the balance sheet at their
fair value. Changes in a derivative's fair value are recognized in the current
periods earnings unless certain hedge accounting criteria are satisfied.

The Company elected not to adopt the optional hedge
accounting provisions of SFAS No. 133 for an interest rate swap contract that
was outstanding on April 30, 2001. Accordingly, for U.S. GAAP reporting purposes
only, beginning in 2001 and for such contract, unrealized gains and losses
resulting from the valuation of this derivative financial instruments at fair
value were recognized in consolidated net earnings as the gains and losses
arise. In 2004, the Company terminated this interest rate swap contract
resulting in a reversal of the recorded fair value of this derivative for U.S.
GAAP purposes.

24

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

29. Reconciliation of Canadian and United States Generally
Accepted Accounting Principles (continued)

In 2004, the Company entered into new interest rate swaps and
designated those derivatives as fair value hedges of its subordinated unsecured
debt (the hedged item). Since the hedge accounting criteria are satisfied, the
change in the fair value of the interest rate swaps is offset in U.S. GAAP
consolidated earnings against the change in the fair value of the hedged item.
In the U.S. GAAP consolidated balance sheet, the interest rate swaps are
recorded at fair value and a corresponding adjustment is made to the hedged
item.

In its primary Canadian GAAP consolidated financial
statements, the Company does not recognize any gains or losses relating to the
interest rate swaps but accounts for cash flows relating to such as an
adjustment of accrued interest expense on the underlying debt instruments.

b) Pension expense and minimum liability

On May 1, 2000, the Company adopted the Canadian accounting
recommendations for employee future benefit costs. The recommendations
essentially harmonized Canadian GAAP with U.S. GAAP and were applied
prospectively. Differences between Canadian and U.S. GAAP remain with respect to
the amortization of actuarial gains and losses arising prior to May 1, 2000.
Upon transition to the new Canadian recommendations, all unamortized gains and
losses were accumulated into a net transitional asset which is being amortized
to consolidated earnings. This approach creates a difference with U.S. GAAP,
under which net actuarial gains accumulated prior to May 1, 2000, continue to be
amortized over the expected average remaining service period using the corridor
approach.

Under U.S. GAAP, the Company has recorded an additional
minimum pension liability for unfunded plans representing the excess of unfunded
accumulated benefit obligations over the recorded accrued benefit liability. A
corresponding amount is recognized as an intangible asset except to the extent
that this additional liability exceeds the related unrecognized past service
costs, in which case the excess is charged directly to "Consolidated
comprehensive income", net of related future income taxes.

c) Sale and leaseback transactions

Under Canadian GAAP, certain leases concluded in conjunction
with sale and leaseback transactions have been afforded operating lease
treatment. Under U.S. GAAP, these transactions in which the Company has a
continuing involvement in the underlying assets have been accounted for under
the financing method. Under this method, the Company records the sale proceeds
as a liability, recognizes interest expense, and continues to record and
amortize the related assets. The accounting for the sale and leaseback
transactions under the financing method will continue until the Companys
continuing involvement in the related assets ceases.

d) Stock-based compensation

Under U.S. GAAP, the Company follows the intrinsic value
method of accounting for stock-based compensation arrangements, as provided for
in Accounting Principles Board (APB) Opinion No. 25. For the period between
September 1999 and April 2002, grants of options under one of the existing
employee stock option plans were accompanied by stock appreciation rights (SARs)
whereby participants could choose to exercise a SAR instead of the corresponding
option. In such cases, the participants received a cash payment equal to the
difference between the closing price of Class B shares on the day immediately
preceding the day of exercise and the exercise price of the option. Under the
intrinsic value method, such a plan results in a liability and requires
measurement of compensation expense which assumes that all participants will
exercise the SARs. In April 2002, the Company cancelled the SARs. Prior to this
cancellation, the periodic change in the value of the SARs was included in
consolidated earnings. Options that were granted prior to September 1999 and
after April 2002 had an exercise price equal to the market price at the date of
the grant; therefore, no compensation cost has been charged to earnings. Under
Canadian GAAP, no amount was recognized for stock options granted prior to April
26, 2004 upon issuance and any consideration received when participants
exercised their options was credited to capital stock.

As described in Note 3, starting April 26, 2004, the Company
began recording stock-based compensation costs which are measured at the grant
date of the award based on the fair value method and recognized in consolidated
earnings over the related service period.

e) Deferred charges and other assets

Under Canadian GAAP, certain development expenses are
deferred and amortized over a period of five to seven years. Under U.S. GAAP,
those costs are charged to consolidated earnings as incurred.

f) Asset retirement obligations

As described in Note 3, during 2005, for Canadian GAAP
purposes, the Company adopted the recommendations of CICA Handbook Section 3110.
This change in accounting policy was applied retroactively with restatement of
the prior years consolidated financial statements.

For U.S. GAAP purposes, during 2004, the Company adopted the
provisions of SFAS 143 "Accounting for Asset Retirement Obligations". Under such
provisions, the cumulative effect of the change in accounting policy has been
included in the consolidated statements of earnings during the year of adoption
of the accounting policy.

g) Supplier rebates and other supplier payments

As mentioned in Note 3, on January 30, 2004, the Company
applied EIC-144 both early and retroactively and prior years financial
statements and purchase price allocation have been restated. This new standard
was applicable for all arrangements.

For U.S. GAAP purposes, effective January 1, 2003, the
Company adopted the provisions of EITF No. 02-16, "Accounting by a Customer
Including a Reseller for Certain Consideration Received from a Vendor". Under
such provisions, the cumulative effect of the change in accounting policy has
been included in the statement of earnings during the year of adoption of the
accounting policy. This new standard was applicable to new arrangements entered
into after December 31, 2002.

25

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

29. Reconciliation of Canadian and United States Generally
Accepted Accounting Principles (continued)

h) Share issue expenses

Under Canadian GAAP, share issue expenses net of future
income taxes are presented as a reduction of consolidated retained earnings.
Under U.S. GAAP, these expenses are presented as a reduction of capital stock.

i) Net earnings per share

Under Canadian GAAP and U.S. GAAP, the method used to
determine the dilutive effect of stock options was the same for year 2004.
However, for 2005 and 2006, a difference results from the recording of
stock-based compensation costs under Canadian GAAP.

|                                                                             | 2006    | 2005    | 2004   
|---------------------------------------------------------------------------- | ------- | ------- | -------
|                                                                             |         |         |        
|Weighted average number of shares (in
    thousands)                         | 202,030 | 201,342 | 179,317
|Dilutive effect of stock options under U.S.
    GAAP (in thousands)          | 5,967   | 5,348   | 8,060  
|Weighted average number of diluted shares
    under U.S. GAAP (in thousands) | 207,997 | 206,690 | 187,377

j) Cumulative translation adjustments

Under Canadian GAAP, the Companys gains and losses arising
from the translation of the Canadian and corporate operations are in cumulative
translation adjustments account in shareholders equity. Under U.S. GAAP, such
adjustments are presented as a component of consolidated other comprehensive
income under shareholders equity.

k) Accounting for fixed assets and leasehold improvements

Under Canadian GAAP, prior years consolidated financial
statements have been restated to reflect the effect of accounting changes for
fixed assets and lease accounting as described in Note 3. Under U.S. GAAP, the
cumulative effect of the change in accounting policy for depreciation and
amortization of fixed assets to the straight-line method in 2005 is included in
the consolidated earnings for the year. For 2005, the impact of this difference
is an increase in the US GAAP earnings before income taxes of $0.6 and an
increase in depreciation expense of $1.5 in 2004 and an increase in net earnings
of $0.4 in 2005 (decrease of $1.0 in 2004). For both Canadian and US GAAP, the
negative impact on net earnings and diluted earnings per share of the
restatement for accounting for leasehold improvements amounted to $2.4 and $0.01
respectively for 2004.

B. Consolidated Comprehensive Income

U.S. GAAP require the presentation of the following
statements of consolidated comprehensive income and accumulated other
comprehensive income:

|                                                                                                | 2006  | 2005  | 2004    
|----------------------------------------------------------------------------------------------- | ----- | ----- | --------
|                                                                                                |       |       | restated
|                                                                                                |       |       | (Note 3)
|                                                                                                | $     | $     | $       
|Net earnings in accordance with U.S. GAAP                                                       | 196.9 | 155.1 | 47.9    
|Other comprehensive income                                                                      |       |       |         
|Cumulative translation adjustments (j)                                                          | 40.2  | 30.0  | 14.7    
|                                                                                                |       |       |         
|Net change in minimum pension liability (net
    of taxes of $0.1 in 2006 and $0.3 in 2005) (b) | 0.3   | (0.9) | -       
|                                                                                                | 40.5  | 29.1  | 14.7    
|Consolidated comprehensive income                                                               | 237.4 | 184.2 | 62.6    
|                                                                                                |       |       |         
|Changes in items of the accumulated other
    comprehensive income are as follows:              |       |       |         
|                                                                                                |       |       |         
|                                                                                                | 2006  | 2005  | 2004    
|                                                                                                |       |       | restated
|                                                                                                |       |       | (Note 3)
|                                                                                                | $     | $     | $       
|Accumulated other comprehensive income                                                          |       |       |         
|Balance, beginning of year                                                                      | 55.7  | 26.6  | 11.9    
|Changes during the year                                                                         |       |       |         
|Cumulative translation adjustments                                                              | 40.2  | 30.0  | 14.7    
|Minimum pension liability                                                                       | 0.3   | (0.9) | -       
|Balance, end of year                                                                            | 96.2  | 55.7  | 26.6    

26

---



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTSFor the years ended April 30, 2006,
April 24, 2005 and April 25, 2004 
(in millions of US dollars, except share and stock option data)

29. Reconciliation of Canadian and United States Generally
Accepted Accounting Principles (continued)

C. Accounting for stock-based compensation

Under U.S. GAAP, SFAS No. 123, "Accounting for Stock-based
Compensation" establishes financial accounting and reporting standards for
employee stock-based compensation plans as well as transactions in which an
entity issues its equity instruments to acquire goods or services from
non-employees. Under U.S. GAAP, as permitted by SFAS No. 123, the Company has
elected to continue to follow the intrinsic value method of accounting for
stock-based compensation arrangements with employees. The effect of the
intrinsic value method is described in Note 29A d). If the fair value method of
accounting had been applied, the Company's consolidated net earnings and net
earnings per share in accordance with U.S. GAAP would have been as follows on a
pro forma basis:

|                                                            | 2006  | 2005  | 2004    
|----------------------------------------------------------- | ----- | ----- | --------
|                                                            |       |       | restated
|                                                            |       |       | (Note 3)
|                                                            | $     | $     | $       
|Net earnings, in accordance with U.S. GAAP,
    as reported | 196.9 | 155.1 | 47.9    
|Compensation costs under the fair value
    method          | 5.8   | 4.6   | 4.0     
|Pro forma net earnings                                      | 191.1 | 150.5 | 43.9    
|                                                            |       |       |         
|Basic net earnings per share as reported                    | 0.97  | 0.77  | 0.27    
|                                                            |       |       |         
|Pro forma basic net earnings per share                      | 0.95  | 0.75  | 0.24    
|                                                            |       |       |         
|Diluted net earnings per share as reported                  | 0.95  | 0.75  | 0.26    
|                                                            |       |       |         
|Pro forma diluted net earnings per share                    | 0.92  | 0.73  | 0.23    

Under the provisions of SFAS No. 123, the pro forma
disclosures above include the effects of stock options granted by the Company
subsequent to the 1995 year end. Under Canadian GAAP, pro forma disclosures
similar to those above were provided for year 2004 and only include the effects
of stock options granted by the Company subsequent to April 29, 2002.

D. Accounting pronouncements not yet implemented

Canadian GAAP

In January 2005, the CICA Accounting Standards Board (AcSB)
issued Section 1530, "Comprehensive Income", Section 3855, "Financial
Instruments  Recognition and Measurement" and Section 3685, "Hedges". These new
sections are effective for interim and annual financial statements relating to
fiscal years beginning on or after October 1, 2006 and provide comprehensive
requirements for the recognition and measurement of financial instruments, as
well as standards on when and how hedge accounting may be applied. Additionally,
these sections introduce a new component of equity referred to as other
comprehensive income.

Section 1530 requires companies to disclose comprehensive
income, which includes, in addition to net income, other comprehensive income
consisting primarily of unrealized gains and losses that will be recorded in
earnings when the related assets and liabilities are derecognised. The
components of other comprehensive income consist of unrealized gains and losses
related to the translation of foreign currency financial statements, certain
deferred gains and losses from hedging activities, and unrealized gains and
losses on certain investment securities.

For the most part, these new standards harmonize Canadian
GAAP with standards previously issued by the U.S. Financial Accounting Standards
Board (FASB). The Company expects that the impact of these new sections will be
comparable to the adjustments indicated in subsections a) Derivative financial
instruments and j) Cumulative translation adjustment presented in section A of
the present note.

U.S. GAAP

In December 2004, the FASB issued SFAS No. 123(R),
"Share-Based Payment". This standard amends SFAS No. 123, "Accounting for
Stock-Based Compensation" and supersedes APB Opinion No. 25. The principal
amendments relate to the requirement to use a fair value based method to record
stock-based compensation at fair value. The Company must apply this standard at
the latest for fiscal year 2007. The Company do expect that these
recommendations will have an impact on its consolidated results of operations
and financial condition similar to what is presented in the other comprehensive
income.

In November 2004, the FASB issued SFAS No. 151, "Inventory
Costs, an amendment of Accounting Research Bulletin (ARB) No. 43, Chapter 4".
SFAS No. 151 clarifies that abnormal inventory costs such as costs of idle
facilities, excess freight and handling costs, and wasted materials (spoilage)
are required to be recognized as current period charges The provisions of SFAS
No. 151 will be effective for fiscal year 2007 and the Company does not expect
that these recommendations will have a material impact on its consolidated
results of operations and financial condition.

In May 2005, the FASB issued SFAS No 154, "Accounting Changes
and Error Corrections, a Replacement of APB Opinion No. 20 and FASB Statement
No. 3". SFAS No. 154 establishes retrospective application to prior periods
financial statements as the required method for reporting a change in accounting
principles, unless impracticable. This standard is effective for accounting
changes and corrections of errors made in fiscal years beginning after December
15, 2005. This new standard harmonize US GAAP with Canadian GAAP. The Company
does not expect that these recommendations will have a material impact on its
consolidated results of operations and financial condition.

27

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UNDERTAKING AND CONSENT TO SERVICE OF PROCESS

A.Undertaking

The Registrant undertakes to make
available, in person or by telephone, representatives to respond to inquiries
made by the Commission staff, and to furnish promptly, when required to do so by
the Commission staff, information relating to: the securities registered
pursuant to Form 40-F; the securities in relation to which the obligation to
file an annual report on Form 40-F arises; or transactions in said securities.

B.

The
Registrant has previously filed with the Commission a Form F-X.

SIGNATURE

Pursuant to the requirements of the Exchange Act, the
Registrant certifies that it meets all of the requirements for filing on Form
40-F and has duly caused this annual report to be signed on its behalf by the
undersigned, thereto duly authorized.

|              | ALIMENTATION
    COUCHE-TARD INC.
|------------- | ---------------------------------
|              |                                  
|              |                                  
|July 14, 2006 | By: /s/
    Sylvain Aubry        
|              | Sylvain Aubry                    
|              | Corporate Secretary              

EXHIBIT INDEX

|Number | Document                                                                                                                                                          
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                   
|99.1   | Consent of Raymond Chabot Grant
    Thornton, LLP.                                                                                                                
|       |                                                                                                                                                                   
|99.2   | Certification pursuant to Rule
    13a-14 or 15d-14 of the Exchange Act, as adopted pursuant to Section 302 of
    the Sarbanes-Oxley Act of 2002 (Alain Bouchard)
|       |                                                                                                                                                                   
|99.3   | Certification pursuant to Rule
    13a-14 or 15d-14 of the Exchange Act, as adopted pursuant to Section 302 of
    the Sarbanes-Oxley Act of 2002 (Richard Fortin)
|       |                                                                                                                                                                   
|       |                                                                                                                                                                   
|99.4   | Certification pursuant to Title 18,
    United States Code, Section 1350 as adopted pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002 (Alain Bouchard)
|       |                                                                                                                                                                   
|99.5   | Certification pursuant to Title 18,
    United States Code, Section 1350 as adopted pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002 (Richard Fortin)
|       |                                                                                                                                                                   

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Raymond Chabot Grant Thornton LLP 
Chartered Accountants

Consent of Independent Registered
Public Accounting Firm

We consent to the use of our reports
dated June 14, 2006 on managements assessment of internal control over
financial reporting and the effectiveness of internal control over financial
reporting of Alimentation Couche-Tard Inc. (the "Corporation") as of April 30,
2006 and on the consolidated balance sheets of the Corporation as at April 30,
2006 and April 24, 2005 and the consolidated statements of earnings, contributed
surplus, retained earnings and cash flows for each of the years in the
three-year period ended April 30, 2006, which reports appear in this Annual
Report on Form 40-F.

/S/ Raymond Chabot Grant Thornton LLP

Chartered Accountants

Montreal. Canada 
July 14, 2006



Suite 1900
National Bank Tower 
600 De La Gauchetière Street West 
Montréal, Québec H3B 4L8 
Telephone: (514) 878-2691 
Fax: (514) 878-2127 www.rcgt.com

Member of Grant Thornton International

---

Certification of the Chairman of the Board, President and
Chief Executive Officer
 Pursuant to Rule 13a-14 Or 15d-14 of The Exchange Act, 
As Adopted Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002

I, Alain Bouchard, Chairman of the
Board, President and Chief Executive Officer of ALIMENTATION COUCHE-TARD INC.,
certify that:

1.            
I have reviewed this Annual Report on Form 40-F of Alimentation Couche-Tard
Inc.;

2.            
Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3.            
Based on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the financial
condition, results of operations and cash flows of the issuer as of, and for,
the periods presented in this report;

4.            
The issuers other certifying officers and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act
Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:

(a)   
Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the issuer, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;

(b)   
Designed such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles;

(c)   
Evaluated the effectiveness of the issuers disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this
report based on such evaluation; and

(d)  
Disclosed in this report any change in the issuers internal control over
financial reporting that occurred during the period covered by the annual report
that has materially affected, or is reasonably likely to materially affect, the
issuers internal control over financial reporting; and

5.            
The issuers other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the issuers
auditors and the audit committee of the issuers board of directors (or persons
performing the equivalent functions):

(a)   All
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely to
adversely affect the issuers ability to record, process, summarize and report
financial information; and

(b)  Any
fraud, whether or not material, that involves management or other employees who
have a significant role in the issuers internal control over financial
reporting.

|DATED the 14th day of July,
    2006. | (s) Alain Bouchard                   
|------------------------------------- | -------------------------------------
|                                      | Name:   Alain Bouchard               
|                                      | Title:     Chairman of the
    Board,
|                                      | President and Chief Executive Officer
|                                      |                                      

---

Certification of the Executive Vise-President and Chief
Financial Officer
 Pursuant to Rule 13a-14 Or 15d-14 of The Exchange Act, 
As Adopted Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002

I, Richard Fortin, Executive
Vice-President and Chief Financial Officer of ALIMENTATION COUCHE-TARD INC.,
certify that:

1.            
I have reviewed this Annual Report on Form 40-F of Alimentation Couche-Tard
Inc.;

2.            
Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3.            
Based on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the financial
condition, results of operations and cash flows of the issuer as of, and for,
the periods presented in this report;

4.            
The issuers other certifying officers and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act
Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:

(a)   
Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the issuer, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;

(b)   
Designed such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles;

(c)   
Evaluated the effectiveness of the issuers disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this
report based on such evaluation; and

(d)  
Disclosed in this report any change in the issuers internal control over
financial reporting that occurred during the period covered by the annual report
that has materially affected, or is reasonably likely to materially affect, the
issuers internal control over financial reporting; and

5.            
The issuers other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the issuers
auditors and the audit committee of the issuers board of directors (or persons
performing the equivalent functions):

(a)   All
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely to
adversely affect the issuers ability to record, process, summarize and report
financial information; and

(b)  Any
fraud, whether or not material, that involves management or other employees who
have a significant role in the issuers internal control over financial
reporting.

|DATED the 14th day of July,
    2006. | (s) Richard Fortin                      
|------------------------------------- | ----------------------------------------
|                                      | Name:   Richard Fortin                  
|                                      | Title:     Executive
    Vice-President,
|                                      | and Chief Financial Officer             
|                                      |                                         

---

SOA Section 906 Certification
CERTIFICATIONPursuant to 18 U.S.C.
§ 1350, the undersigned officer of Alimentation Couche-Tard Inc. (the
"Company"), hereby certifies, to such officer's knowledge, that the Company's
Annual Report on Form 40-F for the year ended April 30, 2006 (the "Report")
fully complies with the requirements of § 13(a) or § 15(d), as applicable, of
theSecurities
Exchange Act of 1934 and that the information contained in the Report fairly
presents, in all material respects, the financial condition and results of
operations of the Company.

DATED the 14th day of July,
2006.

(s) Alain BouchardName:   Alain BouchardTitle:     Chairman of the
      Board,President and Chief Executive Officer


---

SOA Section 906 Certification
CERTIFICATIONPursuant to 18 U.S.C.
§ 1350, the undersigned officer of Alimentation Couche-Tard Inc. (the
"Company"), hereby certifies, to such officer's knowledge, that the Company's
Annual Report on Form 40-F for the year ended April 30, 2006 (the "Report")
fully complies with the requirements of § 13(a) or § 15(d), as applicable, of
theSecurities
Exchange Act of 1934 and that the information contained in the Report fairly
presents, in all material respects, the financial condition and results of
operations of the Company.

DATED the 14th day of July,
2006.

(s) Richard FortinName:   Richard FortinTitle:     Executive
      Vice-President,and Chief Financial Officer


---