Q2 2025 Dollarama Inc Earnings Call Transcript
Key Points
- Dollarama Inc (DLMAF) reported strong second quarter fiscal 2025 results with an EPS of $1.02.
- Same-store sales grew by 4.7% in Q2, despite a cautious consumer spending environment.
- Gross margin improved to 45.2% from 43.9% in Q2 of fiscal 2024, driven by favorable shipping rates and lower logistics costs.
- Dollarcity opened 23 net new stores in Q2, bringing the total store count to 570, reflecting strong consumer response in LATAM markets.
- The company repurchased over 2.1 million common shares for cancellation, demonstrating strong capital allocation and shareholder return strategy.
- Seasonal product sales were softer, impacted by unfavorable weather and cautious consumer spending.
- Same-store sales growth is expected to normalize in the second half of the year, implying a lower growth rate compared to the first half.
- SG&A as a percentage of sales remained flat at 13.6%, with expected pressure in the second half due to increased store labor and operating costs.
- Higher logistics costs are anticipated in the second half of the year, which may impact gross margins.
- The company faces challenges in maintaining basket size, which decreased by 2.2% despite an increase in the number of transactions.
Good morning, and welcome to Dollarama Fiscal 2025 Second Quarter Results Conference Call. Neil Rossy, President and CEO; and Patrick Bui, CFO, will make a short presentation, followed by a question-and-answer period open exclusively to financial analysts.
The press release, financial statements and management's discussion and analysis are available at dollarama.com in the Investor Relations section as well as on SEDAR+.
Before we start, I have been asked by Dollarama to read the following message regarding forward-looking statements. Dollarama's remarks today may contain forward-looking statements about its current and future plans, expectations, intentions, results, levels of activity, performance, goals or achievements or any other future events or developments.
Forward-looking statements are based on information currently available to management and on estimates and assumptions made based on factors that management believes are appropriate and reasonable in the circumstances. However, there can be no assurance that such estimates and assumptions will prove to be correct.
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