"It doesn't make sense for us to wander away and do things that we're not very good at," chief executive Stephen Wetmore told analysts during a call Thursday.
"We're choosy. We'll prepare for it, and if we're going to execute on anything, it will be extremely well-executed with a high success factor. I'll look anywhere (for acquisitions) but it's a matter of us fitting in."
Any acquisition would most likely be in the retailer's key categories, such as sports and automotive, he added.
The Toronto-based company is in the midst of a three-year strategic plan aimed at rebranding itself as more than just a general merchandiser known for its array of products in the household, outdoor and auto sectors.
Wetmore said efforts so far have been successful, as evidence from its latest quarter where sales rose despite a late start to the spring season. Spring is a key time for retailers who look for increased spending by consumers preparing for summer activities, vacations and home renovations.
"Our efforts are paying off by shifting our focus to thinking more like a group of speciality retailers and less like general merchant," said Wetmore.
Canadian Tire reported Thursday that its profits grew to $178.9 million for the three month-period ended June 29. This compared with $154.9 million in the comparable quarter a year earlier.
On a per share basis, the results were equivalent to $2.12 compared to $1.91 in the same period last year.
Revenue increased to $3.17 billion from $3.02 billion helped by sales at FGL Sports, the subsidiary that operates the Sport Chek and recently-acquired Pro Hockey Life stores.
For the quarter, same-store sales at Sport Chek increased 10.8 per cent, while the same key measurement of retail performance at Mark's stores was up 3.2 per cent. Canadian Tire saw same-store sales growth of 2.8 per cent.
Meanwhile, the company, which also owns clothing retailer Mark's, announced that Canadian Tire president Michael Medline will take over as CEO when Wetmore leaves on Dec. 1. Wetmore will remain on Canadian Tire's board in a non-executive role of deputy chairman, a position that will be created for him.
The move was largely anticipated by investors.
Medline told analysts he will continue have Canadian Tire remain "on the offence" amid stiff competition from U.S. retail rivals such as Walmart and Target and make full use of digital technology to set itself apart.
"This is going to be a big change to face our industry and a challenge. We're figuring it out and it's working for us. It's going to be a strategic advantage to us going forward," said Medline.
Some of these initiatives include better use of customer analytics, phasing out paper flyers at Sport Chek and Mark's, and expanding its loyalty programs.
"The industry is moving fast. This is not the sleepy retail industry decades ago," he said. "This is a very exciting place to do business. But, like with everything, winner takes all. We need to be very fast and very successful."
The retailer said it will provide more details on its strategic plan during an investor day event Oct. 9.
Irene Nattel, an analyst with RBC Dominion Securities, said the company has made it clear that it was able to withstand volatile winter and spring weather conditions through a number of "deliberate actions."
Founded in 1922, Canadian Tire has nearly 1,700 retail and gasoline outlets across the country, including various banners under FGL Sports, such as Hockey Experts, Sports Experts, National Sports, Intersport and Atmosphere.
The company also holds a majority interest in CT Real Estate Investment Trust (TSX:CRT.UN), which acquired most of the company's real estate last year, and operates a financial services division which includes credit cards.
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