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Highlights

  • Dollarama’s sales for Q3FY25 grew 5.7% YoY, reaching CAD 1,562.6 million, driven by store network expansion
  • Net income for Q3FY25 increased 5.7% YoY, reaching CAD 275.8 million despite higher taxes
  • Dollarama plans to expand to 2,200 stores by 2034, maintaining a two-year capital payback period

Dollarama Inc (TSX:DOL) is a discount retail stores operator based in Canada. It has a market cap of CAD 38.58 billion.

Financial update for Q3FY25

In Q3FY25, Dollarama's total revenue rose by 5.8% YoY to CAD 1,562.6 million, compared to CAD 1,477.6 million in the same period last year. This increase was mainly driven by growth in the total number of stores. In Q3FY25, operating income saw a 5.4% YoY increase, reaching CAD 407.4 million, up from CAD 386.6 million in Q3 2024, largely due to higher revenue and gross profit.

Earnings before income taxes improved by 4.5% YoY in Q3FY25, totaling CAD 365.8 million, compared to CAD 349.9 million in the prior year. This growth was primarily driven by higher operating income, although partially offset by higher interest costs. Net income for the period rose by 5.7% YoY to CAD 275.8 million, compared to CAD 261.0 million in Q3 2024, despite a higher tax burden.

Recent Business Update

On December 4, 2024, the corporation announced an agreement to acquire land in the Calgary, Alberta region for the development of a logistics hub. The total cash consideration for the land is CAD 46.7 million, subject to customary closing purchase price adjustments.

Company Outlook

The company's management is confident that the corporation can profitably expand its Canadian store network to around 2,200 stores by 2034, while maintaining an average capital payback period of about two years for each new store.

Top 10 Shareholders

The top 10 shareholders of Dollarama own about 25.68% of the total shares of the company. Caisse de Depot et Placement du Quebec holds the largest stake at around 4.74%. The Vanguard Group, Inc. follows with a stake of approximately 3.20%.

Stock Information

The stock has experienced a decline of approximately 2.25% over the past week and 2.80% over the past month. It is currently trading above the average of its 52-week high of CAD 152.97 and its 52-week low of CAD 98.14. As of February 4, 2025, the stock's closing price is CAD 137.92.

Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on February 04, 2025. The reference data in this report has been partly sourced from EODHD/Others.