DOLLARAMA REPORTS FISCAL 2026 THIRD QUARTER RESULTS

Executive Summary

• Dollarama reported a strong third‑quarter performance, with sales up 22.2% YoY to $1.91 bn, net earnings up 16.6% to $321.7 m, and diluted EPS rising 19.4% to $1.17.
• Comparable store sales in Canada grew 6.0%, and the company opened 19 net new stores in Canada plus 6 in Australia during the quarter.
• The board approved a quarterly cash dividend of $0.1058 per share and repurchased 2,605,912 shares for $484.6 m under its normal‑course issuer bid.

Key Details

• Financial Highlights (Q3 FY2026 vs Q3 FY2025)
• Sales: $1,909.4 m ↑ 22.2%
• EBITDA: $612.0 m ↑ 20.1% (margin 32.1% vs 32.6%)
• Operating income: $481.2 m ↑ 18.1% (margin 25.2% vs 26.1%)
• Net earnings: $321.7 m ↑ 16.6%

• Diluted EPS: $1.17 ↑ 19.4% (from $0.98)

• Store Expansion

• Canada: 19 net new stores (total Canadian store count 1,684)
• Australia (The Reject Shop): 6 net new stores (total Australian count 401)

• Dollarcity (Latin America joint venture) opened 25 net new stores in the quarter, reaching 683 total locations.

• Segment Performance

• Canada: Comparable store sales +6.0% (transactions +4.1%, basket size +1.9%)
• Australia contribution: $186.1 m of sales; gross margin impact –100 bps; SG&A impact +120 bps.

• Dollarcity equity‑accounted earnings contributed $42.4 m for July–Sept 2025 (up 56.5% YoY).

• Capital Allocation

• Share repurchase: 2,605,912 shares cancelled for $484.6 m (avg. $185.96 per share).

• Dividend: $0.1058 per common share payable Feb 6 2026 to shareholders of record Jan 9 2026.

• Guidance Updates (Canadian Segment)

• Comparable store sales guidance raised to 4.2%–4.7% (from 3.0%–4.0%).
• Gross margin guidance raised to 45.0%–45.5% (from 44.2%–45.2%).

• Capital expenditures guidance lowered to $240 m–$285 m (from $285 m–$330 m).

• Financing Activity

• Net financing costs rose $7.4 m due to issuance of 3.850% Fixed‑Rate Notes in Q2 FY2026 and higher lease interest.

• Total debt as of Nov 2 2025: $2.645 bn; net debt $2.439 bn.

• Other Notable Items

• No guidance provided for Australian segment separately.
• Management highlighted the opening of Dollarcity’s 700th store in Latin America and a fifth location in Mexico (post‑quarter).
• Conference call scheduled for Dec 11 2025, 10:30 a.m. ET.

Notable Quotes

• Neil Rossy, President & CEO: “Our business model continues to demonstrate its enduring relevance and resilience, driving strong 6.0% comparable store sales growth in Canada for the quarter.”
• Neil Rossy (continued): “Internationally, we also continued to advance our growth plans… opening their 700th store in Latin America and preparing The Reject Shop’s transformation.”