Dollarama reported fiscal 2024 third quarter results.
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Sales for the third quarter of Fiscal 2024 increased by 14.6% to $1,477.7 million, compared to $1,289.6 million in the corresponding period of the prior fiscal year.
This increase was driven by growth in the total number of stores over the past 12 months (from 1,462 stores on October 30, 2022, to 1,541 stores on October 29, 2023) and increased comparable store sales.
Comparable store sales for the third quarter of Fiscal 2024 increased by 11.1%, consisting of a 10.4% increase in the number of transactions and a 0.6% increase in average transaction size, over and above comparable store sales growth of 10.8% in the corresponding period of the prior fiscal year.
The increase in comparable store sales is primarily attributable to higher sales across all product categories, including continued higher than historical demand for consumables.
EBITDA totalled $478.8 million, or 32.4% of sales, for the third quarter of Fiscal 2024, compared to $386.2 million, or 29.9% of sales, in the third quarter of Fiscal 2023.
Gross margin(1) was 45.4% of sales in the third quarter of Fiscal 2024, compared to 43.3% of sales in the third quarter of Fiscal 2023.
Gross margin as a percentage of sales was higher primarily as a result of lower inbound shipping costs and lower logistics costs.
The Corporation's 50.1% share of Dollarcity's net earnings for the period from July 1, 2023 to September 30, 2023 was $18.0 million, compared to $9.2 million for the same period last year.
The Corporation's investment in Dollarcity is accounted for as a joint arrangement using the equity method.
Net financing costs increased by $6.3 million, from $30.4 million for the third quarter of Fiscal 2023 to $36.7 million for the third quarter of Fiscal 2024.
The increase is mainly due to a higher average borrowing rate, as well as higher average debt levels from Fixed Rate Notes and lease liabilities.
Net earnings were $261.1 million, or $0.92 per diluted common share, in the third quarter of Fiscal 2024, compared to $201.6 million, or $0.70 per diluted common share, in the third quarter of Fiscal 2023. ■