Dollarama profit up 18% on surge in sales
Shoppers spent 4.5% more and number of stores rises
Dollarama Inc. says it earned $130.1 million in its third quarter, an 18 per cent improvement from the same quarter last year, as sales volume at the discount chain surged.
Sales were up 9.7 per cent to $810.6 million, as comparable store sales grew and the total number of stores expanded to 1,135 as of Oct. 29. The chain added 66 stores in the past year, in line with its ambitious expansion targets.
People spent on average 4.5 per cent more at Dollarama stores in the past year and the number of transactions expanded by 0.1 per cent.
The chain increased its margins by raising prices after the low loonie earlier this year made imported goods more expensive. The company also entered into foreign exchange contracts to hedge against fluctuations in currency. Many goods made in China and elsewhere are still priced in U.S. dollars.
The company said Wednesday that profit amounted to $1.15 per diluted share, up from 92 cents per diluted share a year ago when the company had more shares outstanding.
Dollarama's success in the discount sector this quarter comes on top a 5.1 per cent increase in comparable store sales in fiscal 2017.