Dollarama beat fourth-quarter gross sales and revenue estimates on Thursday, helped by cost-conscious customers flocking to its shops in the course of the vacation season to purchase reasonably priced objects reminiscent of groceries and toys.
Shoppers buying on a funds have more and more switched to lower-priced alternate options throughout classes starting from pantry staples to cleansing provides, boosting demand at greenback shops reminiscent of Dollarama.
Retailers in Canada additionally gained from providing reductions in the course of the vacation quarter on classes reminiscent of decorations, which helped draw extra consumers to their shops.
Dollarama posted internet gross sales of C$1.88bn for the quarter, in contrast with analysts’ estimate of C$1.87bn in line with knowledge compiled by LSEG.
It posted internet earnings of C$1.40 per share within the three months to February 2, in contrast with C$1.15 a yr earlier. Analysts on common anticipated revenue of C$1.31 per share.
The Montreal, Quebec-based firm’s quarterly gross margin was 46.8% of gross sales, from 46.3% a yr earlier.
Easing prices of logistics helped the corporate in combating operations prices, in flip enhancing its margins.
US retailers reminiscent of Walmart, Goal and Greenback Common supplied dour forecasts as they face the brunt of President Donald Trump’s import tariffs.
Whereas Canadians go for extra regionally produced objects within the wake of “Purchase Canadian” motion in response to Trump’s tariffs, retailers within the nation are reshuffling their cabinets and including fewer merchandise from US corporations.
Dollarama, which final month purchased Australia’s Reject Store, expects annual gross sales to develop within the vary of three%-4%, the midpoint of which is barely beneath analysts’ estimates of three.7%.
The corporate mentioned it believed customers would proceed to reply positively to its reasonably priced merchandise, handy retailer community and robust worth throughout consumables, seasonal objects and normal merchandise.
Reuters
