MONTREAL, Dec. 11, 2025 /PRNewswire/ - Dollarama Inc. (TSX:DOL) ("Dollarama" or the "Corporation") today reported its financial results for the third quarter ended November 2, 2025.
The Corporation has two reportable segments: Canada (which includes the contribution of the Corporation's equity-accounted investments in Latin America) and Australia since the completion of its acquisition of The Reject Shop Limited ("TRS") on July 21, 2025. Refer to "Selected Segmented Financial Information" on page 6 of this press release for additional information.
Fiscal 2026 Third Quarter Results Highlights Compared to Fiscal 2025 Third Quarter
Sales increased by 22.2% to $1,909.4 million, compared to $1,562.6 million
In Canada, Comparable store sales increased by 6.0%, compared to 3.3% in the corresponding period of the previous year
EBITDA(1) increased by 20.1% to $612.0 million, representing an EBITDA margin(1) of 32.1%, compared to 32.6%
Operating income increased by 18.1% to $481.2 million, representing an operating margin(1) of 25.2%, compared to 26.1%
Net earnings increased by 16.6% to $321.7 million, resulting in a 19.4% increase in diluted net earnings per common share to $1.17, compared to $0.98
19 net new stores opened in Canada, compared to 18 in the corresponding period of the previous year and 6 net new stores opened in Australia under the TRS banner
2,605,912 common shares repurchased for cancellation for $484.6 million
"In an economic environment that has remained unpredictable, our business model continues to demonstrate its enduring relevance and resilience, driving strong 6.0% Comparable store sales growth in Canada for the quarter," said Neil Rossy, President and CEO of Dollarama.
"Internationally, we also continued to advance our growth plans and the rollout of the Dollarama model. Dollarcity delivered another quarter of strong financial and footprint growth, opening their 700th store in Latin America and fifth location in Mexico after quarter-end. In Australia, we have begun laying the groundwork for The Reject Shop's transformation as we prepare the platform for the deployment of our value proposition in the coming years," concluded Mr. Rossy.
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(1)
Refer to the section entitled "Non-GAAP and Other Financial Measures" of this press release for the definition of these items and, where applicable, their reconciliation with the most directly comparable GAAP measure.
Fiscal 2026 Third Quarter Financial Results
Sales for the third quarter of fiscal 2026 increased by 22.2% to $1,909.4 million, compared to $1,562.6 million in the corresponding period of the prior fiscal year. This increase was driven by a contribution of $186.1 million in sales from 401 stores in Australia, growth in the total number of stores in Canada over the past 12 months (from 1,601 on October 27, 2024, to 1,684 on November 2, 2025) and Comparable store sales growth in Canada.
Comparable store sales in Canada for the third quarter of fiscal 2026 increased by 6.0%, consisting of a 4.1% increase in the number of transactions and a 1.9% increase in average transaction size, over and above Comparable store sales growth in Canada of 3.3% for the third quarter of fiscal 2025. The increase was primarily driven by sustained demand for consumables and higher sales of seasonal products including four additional Halloween shopping days, compared to the same period last year. As the Corporation continues to evaluate and implement strategies to optimize operations and deploy attributes of the Dollarama business model in Australia over the coming years, the Corporation is not currently presenting Comparable store sales information for this segment.
Gross margin was 44.8% of sales in the third quarter of fiscal 2026, compared to 44.7% of sales in the third quarter of fiscal 2025. Gross margin as a percentage of sales was higher primarily as a result of a favourable sales mix, with higher sales of seasonal products and lower logistics costs in Canada, offset by a 100‑basis point impact from a lower gross margin in Australia.
General, administrative and store operating expenses ("SG&A") for the third quarter of fiscal 2026 represented 15.4% of sales, compared to 14.3% of sales for the third quarter of fiscal 2025. This increase is primarily attributable to SG&A in Australia, impacting SG&A as a percentage of sales by 120 basis points, partially offset by the positive impact of scaling in Canada.
EBITDA was $612.0 million, representing an EBITDA margin of 32.1% for the third quarter of fiscal 2026, compared to $509.7 million, or an EBITDA margin of 32.6% in the third quarter of fiscal 2025. EBITDA for the third quarter of fiscal 2026 includes a contribution of $18.0 million from the Australian segment, which negatively impacted EBITDA margin by 240 basis points.
The Corporation's 60.1% share of net earnings from Central American Retail Sourcing Inc. ("CARS") and its 80.05% share of net earnings from Inversiones Comerciales Mexicanas S.A. ("ICM", and together with CARS and their respective subsidiaries, "Dollarcity") amounted to $42.4 million for the period from July 1, 2025 to September 30, 2025, compared to $27.1 million for the Corporation's 60.1% share of CARS from July 1, 2024 to September 30, 2024, representing a 56.5% year-over-year increase. Dollarcity's strong third quarter performance was mainly driven by a 21.1% increase in sales, primarily attributable to an increase in Comparable store sales and in total number of stores (from 588 on September 30, 2024, to 683 on September 30, 2025), as well as an increase in gross margin as a percentage of sales from lower logistics costs. This was partially offset by a slight increase in SG&A as a percentage of sales from costs associated with Dollarcity's expansion plans in Mexico. The Corporation's investment in Dollarcity is accounted for as a joint arrangement using the equity method.
Net financing costs increased by $7.4 million, from $41.6 million for the third quarter of fiscal 2025 to $49.0 million for the third quarter of fiscal 2026. The increase primarily reflects higher average debt levels resulting from the issuance of the 3.850% Fixed Rate Notes (defined hereinafter) during the second quarter of fiscal 2026, an increase in interest expense on lease liabilities from the Canadian segment and an impact of $2.8 million from the Australian segment.
Net earnings increased by 16.6% to $321.7 million, compared to $275.8 million in the third quarter of fiscal 2025, resulting in an increase in diluted net earnings per common share of 19.4%, to $1.17 per diluted common share, in the third quarter of fiscal 2026, including a negative impact of $0.03 per diluted common share from the Australian segment.
Dollarcity
Mexico Capital Call
During the quarter, the Corporation used proceeds from its 60.1% share of the dividend previously declared by CARS, representing US$37.6 million, to make a second capital contribution of US$18.0 million ($24.5 million) to ICM towards expansion plans in Mexico, reflecting the Corporation's 80.05% ownership interest in ICM.
Network Growth
During its third quarter ended September 30, 2025, Dollarcity opened 25 net new stores, compared to 18 net new stores in the same period last year. As at September 30, 2025, Dollarcity had a total of 683 stores, with 398 locations in Colombia, 113 in Guatemala, 91 in Peru, 80 in El Salvador, and 1 in Mexico. This compares to 632 stores as at December 31, 2024.
Normal Course Issuer Bid
On July 3, 2025, the Corporation announced the renewal of its normal course issuer bid and approval from the Toronto Stock Exchange to repurchase up to 13,865,588 of its common shares, representing 5.0% of the issued and outstanding common shares of the Corporation as at June 30, 2025, during the 12‑month period from July 7, 2025 to July 6, 2026 (the "2025-2026 NCIB").
During the third quarter of fiscal 2026, 2,605,912 common shares were repurchased for cancellation under the 2025‑2026 NCIB, for a total cash consideration of $484.6 million, representing a weighted average price of $185.96 per share, excluding the tax on share repurchases.
Dividend
On December 11, 2025, the Corporation announced that its board of directors approved a quarterly cash dividend for holders of common shares of $0.1058 per common share. This dividend is payable on February 6, 2026 to shareholders of record at the close of business on January 9, 2026. The dividend is designated as an "eligible dividend" for Canadian tax purposes.
Canadian Segment Fiscal 2026 Outlook
The Corporation's fiscal 2026 guidance ranges for Comparable store sales and Gross margin in Canada, initially issued on April 3, 2025, have been increased to reflect year-to-date performance and anticipated continued positive customer response to our product offering in the fourth quarter of fiscal 2026. Capital expenditures guidance for the Canadian segment, which was previously updated on June 11, 2025, has also been lowered to reflect updated timing of certain expenditures related to the development of the Western logistics hub. All other guidance ranges and underlying assumptions remain unchanged.
(as a percentage of sales except netnew store openings in units and capital expenditures in millions of dollars)
Fiscal 2026
Fiscal 2026
Guidance for the Canadian segment asat June 11, 2025
Revised Guidance for the Canadiansegment as at December 11, 2025
Net new store openings
70 to 80
No change
Comparable store sales
3.0% to 4.0%
4.2% to 4.7%
Gross margin
44.2% to 45.2%
45.0 to 45.5%
SG&A
14.2% to 14.7%
No change
Capital expenditures
$285.0 to $330.0
$240.0 to $285.0
As the Corporation continues to evaluate and implement strategies to optimize operations and deploy attributes of the Dollarama business model in Australia over the coming years, the Corporation is not providing guidance that takes into account or presents separately the Australian segment. However, with its plan relating to the implementation of such strategies, the Corporation does not expect the Australian segment to have a positive impact on its overall profitability in the near term, including fiscal 2027.
Guidance ranges for the Canadian segment are based on several assumptions, including the following:
The number of signed offers to lease and store pipeline for the remainder of fiscal 2026, the absence of delays outside of our control on construction activities and no material increases in occupancy costs in the short- to medium-term
Approximately three months visibility on open orders and product margins
Continued positive customer response to our product offering, value proposition and in-store merchandising
The active management of product margins, including through pricing strategies and product refresh, and of inventory shrinkage
The Corporation continuing to account for its investment in Dollarcity as a joint arrangement using the equity method
The entering into of foreign exchange forward contracts to hedge the majority of forecasted merchandise purchases in USD against fluctuations of CAD against USD
The continued execution of in-store productivity initiatives and realization of cost savings and benefits aimed at improving operating expense
The absence of a significant shift in labour, economic and geopolitical conditions, or material changes in the retail environment and projected census and household income data
No significant changes in the capital budget for fiscal 2026 for new store openings and maintenance, and no further changes to transformational capital expenditures
The absence of unusually adverse weather, especially in peak seasons around major holidays and celebrations
The guidance ranges included in this section are forward-looking statements within the meaning of applicable securities laws, are subject to a number of risks and uncertainties and should be read in conjunction with the "Forward-Looking Statements" section of this press release.
Selected Consolidated Financial Information
13-week periods ended
39-week periods ended
(dollars and shares in thousands,except per share amounts)
November 2,
2025
October 27,
2024
November 2,
2025
October 27,
2024
$
$
$
$
Earnings Data
Sales
1,909,442
1,562,644
5,154,490
4,531,800
Cost of sales
1,053,641
863,928
2,841,889
2,518,613
Gross profit
855,801
698,716
2,312,601
2,013,187
SG&A
294,780
223,519
769,460
653,631
Depreciation and amortization
122,244
94,788
310,746
279,041
Share of net earnings of equity- accounted investments
(42,418)
(27,083)
(121,060)
(71,871)
Operating income
481,195
407,492
1,353,455
1,152,386
Unrealized gain from derivative on equity-accounted investments
-
-
(10,348)
-
Net financing costs
48,967
41,603
136,096
119,065
Earnings before income taxes
432,228
365,889
1,227,707
1,033,321
Income taxes
110,504
90,083
310,729
255,730
Net earnings
321,724
275,806
916,978
777,591
Basic net earnings per common share
$1.17
$0.98
$3.32
$2.78
Diluted net earnings per common share
$1.17
$0.98
$3.31
$2.77
Weighted average number of common shares outstanding:
Basic
274,963
281,356
276,336
280,079
Diluted
276,032
282,349
277,402
281,075
Other Consolidated Data
Year-over-year sales growth
22.2 %
5.7 %
