Dollarama Q1 sales up 13%
Sales for the first quarter of Fiscal 2022 increased by 13.0% to $954.2 million, compared to $844.8 million in the corresponding period of the prior fiscal year.
The increase in sales is attributable to the growth in the total number of stores over the past twelve months, from 1,301 stores on May 3, 2020 to 1,368 stores on May 2, 2021, and an increase in comparable store sales driven by higher sales of seasonal items, including Easter holiday and spring-summer products. This is compared to higher sales of consumable products and lower sales of seasonal items in the first quarter of Fiscal 2021 at the onset of the pandemic.
For the nine-week period ended April 4, 2021, the Corporation recorded comparable store sales growth of 15.2% compared to the corresponding period of the previous fiscal year.
However, various provinces across Canada subsequently imposed new or more stringent measures due to the sharp rise in COVID–19 case counts. This included a stay-at-home order and a ban on the sale of non-essential goods in Ontario, where approximately 40% of the Corporation's stores are located, effective April 8, 2021, which had an immediate and sustained impact on sales for the remainder of the quarter.
As a result, comparable store sales growth receded to 5.8% for the full first quarter of Fiscal 2022. Comparable store sales growth, which excludes a limited number of temporarily closed stores, consisted of a 9.3% increase in average transaction size and a 3.2% decrease in the number of transactions. This is compared to comparable store sales growth of 0.7% (excluding temporarily closed stores) in the first quarter of Fiscal 2021.
Subsequent to quarter end, the Government of Ontario announced that the ban on the sale of non-essential goods will be lifted on June 11, 2021. As a result, the ban will have been in place for the first five and a half weeks of the Corporation's second quarter ending August 1, 2021.
Gross margin for the first quarter of Fiscal 2022 was 42.3% of sales, compared to 41.3% of sales for the first quarter of Fiscal 2021. Gross margin was higher due to changes in the sales mix, including higher sales of higher margin items, such as seasonal products. ■