Earnings call transcript: Dollarama Q2 2025 beats EPS forecast, stock dips

Dollarama Inc. reported strong financial results for the second quarter of 2025, with earnings per share (EPS) surpassing analyst expectations. The company achieved an EPS of $1.16, exceeding the forecast of $1.12, representing a 3.57% surprise. Revenue reached $1.72 billion, slightly above the $1.7 billion forecast. According to InvestingPro data, the company is trading at relatively high valuation multiples, with 3 analysts recently revising their earnings estimates upward for the upcoming period. Despite these positive results, Dollarama’s stock experienced a 2.97% decline in pre-market trading, reflecting investor caution amid broader market trends.

Key Takeaways

• Dollarama’s Q2 EPS of $1.16 exceeded forecasts by 3.57%.
• Revenue increased by 10.3% year-over-year to $1.72 billion.
• Pre-market stock price fell by 2.97% despite strong earnings.
• The company opened 27 new stores in Canada, expanding its footprint.
• Same-store sales in Canada grew by 4.9%.

Company Performance

Dollarama demonstrated solid performance in Q2 2025, with a notable 10.3% increase in sales compared to the same period last year. The company’s focus on consumables and strategic expansion in international markets like Australia and Mexico contributed to this growth. InvestingPro analysis reveals impressive returns, with the stock up 17.47% over the past six months and 27.8% year-to-date. The company has maintained dividend payments for 15 consecutive years, currently offering a 6.37% yield. However, the competitive retail environment and economic uncertainty remain challenges. Discover 13 additional exclusive insights about Dollarama’s performance with an InvestingPro subscription.

Financial Highlights

• Revenue: $1.72 billion, up 10.3% year-over-year
• Earnings per share: $1.16, a 13.7% increase from last year
• Net earnings: $321.5 million, up 12.5%
• Gross margin: Improved to 45.5% from 45.2%

Earnings vs. Forecast

Dollarama’s actual EPS of $1.16 beat the forecast of $1.12, marking a 3.57% positive surprise. Revenue also slightly exceeded expectations, coming in at $1.72 billion against a forecast of $1.7 billion. This performance aligns with Dollarama’s historical trend of surpassing market expectations, although the magnitude of the beat was modest compared to previous quarters.

Market Reaction

Despite Dollarama’s earnings beat, the stock price fell by 2.97% in pre-market trading. This decline contrasts with the company’s strong financial performance and may reflect broader market sentiments or investor concerns about consumer spending trends. InvestingPro data shows the stock is trading near its 52-week high of $63.07, with just 0.97% upside to reach this level. The company maintains a market capitalization of $652.47 million and operates with a moderate level of debt. Access Dollarama’s comprehensive Pro Research Report, part of InvestingPro’s coverage of 1,400+ top stocks, for detailed valuation analysis and expert insights.

Outlook & Guidance

Dollarama raised its full-year same-store sales guidance for Canada to the upper end of the 3-4% range. The company plans to open 70-80 net new stores in Canada this fiscal year and aims for 700 stores in Australia by 2034. However, it anticipates a higher effective tax rate due to its expanding international operations.

Executive Commentary

"Our core Canadian business is strong, growing and profitable," stated CFO Patrick Bowie, highlighting the company’s resilience in a challenging market. CEO Neil Rossi emphasized the strategic importance of international expansion: "The goal of the transformation roadmap is to optimize the business and set it up for accelerated growth."

Risks and Challenges

• Economic uncertainty may impact consumer spending.
• Competitive pressures from retailers like Walmart.
• Potential challenges in integrating The Reject Shop in Australia.
• Tariff-related sourcing shifts could affect supply chains.
• Managing increased tax rates from international operations.

Q&A

During the earnings call, analysts inquired about consumer behavior volatility and the gradual transformation of Dollarama’s Australian operations. Executives addressed potential sourcing shifts due to tariffs and clarified their approach to entering the Mexican market, indicating a cautious yet strategic expansion plan.

Full transcript - Dollarama Inc (DOL) Q2 2026:

Conference Call Operator: Good morning, and welcome to Dollarama’s Second Quarter Fiscal twenty twenty six Results Conference Call. On today’s call are Neil Rossi, President and CEO and Patrick Bowie, CFO. They will begin with brief remarks followed by Q and A with financial analysts. Before we begin, please note that today’s remarks may contain forward looking statements about Dollarama’s current and future plans, expectations, intentions, results or any other future events or developments. Forward looking statements are based on information currently available to management and on reasonable estimates and assumptions made by management.

Many factors could cause actual results, future events or developments to differ materially from those expressed or implied. You are cautioned not to place undue reliance on these forward looking statements. Forward looking statements represent management’s expectations as at 08/27/2025. Except as may be required by law, Dollarama has no intention and undertakes no obligation to update or revise any forward looking statement, whether as a result of new information, future events or otherwise. You are invited to consult the cautionary statement on forward looking statements in Dollarama’s management discussion and analysis dated 08/27/2025.

All forward looking statements on today’s call are expressly qualified by this cautionary statement. In addition, Dollarama may refer to certain non GAAP and other financial measures during the call. Please consult the non GAAP and other financial measures section of Dollarama’s MD and A dated 08/27/2025, for definitions, reconciliations with appropriate GAAP measures and other information. The quarterly disclosure documents related to this call are available in the Investor Relations section of dollarama.com and on SEDAR plus I will now turn the call over to Neil Rossi.

Neil Rossi, President and CEO, Dollarama: Thank you, operator, and good morning, everyone. In the second quarter of fiscal twenty twenty six, Dollarama delivered strong financial results and achieved several international milestones. Let me start with international expansion. In the middle of the quarter, we celebrated the opening of Dollarcity’s first store in Mexico, a large and high potential market. Later in the quarter, we completed our acquisition of Australia’s largest discount retailer welcoming the local management team and 5,000 new colleagues.

While vastly different in approach, both market entries are the combination of strategic objectives that have long been in motion. They represent two additional complementary growth platforms, which only strengthen and diversify our long term strategy. They also broaden the strength of our team with a greenfield entry into a huge market and our first transformation of a large existing business. This is all made possible by our successful core Canadian business, which serves as the foundation that fuels our broader ambition. Let’s now look at our performance in Canada.

We generated healthy same store sales both in the quarter and since the beginning of the year. This reflects the underlying strength of our business model, the relevance of our value proposition for Canadian consumers and the team’s impeccable execution. Consumables were once again a driver behind our sales with general merchandise and seasonal remaining stable. This speaks to the appeal of our overall assortment at any given time of year. It also shows that Dollarama continues to cement its place in the regular shopping habits of Canadians, whether for everyday essentials or discretionary goods.

To achieve this, we work incredibly hard day in, day out to offer products at compelling value by maintaining our pricing when possible for our customers in this volatile trade environment. We will stay the course in our efforts, relying on our agility and expertise as buyers to maintain our relative value market to the benefit of consumers. On the real estate front, we opened 27 net new stores in Q2, bringing the total number of net new stores year to date to 49 and our footprint in Canada to sixteen sixty five locations. Halfway through the year, we are well on our way to achieving this fiscal year’s target of between 70 to 80 net new store openings, which as a reminder is exceptionally higher than in previous years. The development of our future Western Logistics Hub situated just North of Calgary also continues to progress well.

Site preparation activities began during the quarter with construction scheduled to start in September. We are pleased to be on plan and on budget at this stage of the project with the site expected to be operational by the 2027. Turning now to Dollarcity, which generated another strong performance both operationally and financially in the second quarter. The business is experiencing similar underlying trends as Canada in terms of customer appeal, reinforcing the relevance of our business model across geographies and demographics. During the second quarter, Dollarcity continued to add stores at a healthy clip, opening 14 net new locations.

This brings their total store count in all five countries of operation in Latin America to six fifty eight. That number includes our first Dollarcity in Mexico located in Guadalajara, Jalisco. While it is still very early days, we are quite pleased and encouraged by the initial reception from customers. We look forward to opening several additional locations in Mexico by fiscal year end. Finally, I’d like to turn to Australia.

Since closing the acquisition of TRS, priority number one has been the onboarding of our new colleagues, sharing our vision for the future and mobilizing the right people and teams to kick start a multi year transformation journey. This work is being led by a strong local management team based in Melbourne supported by a cross functional integration office. The teams will be working on multiple fronts to thoughtfully deploy the Dollarama business model over the coming years. I’m pleased to say that the TRS team is ready and motivated and that this work has already begun. On the merchandising front, we are now starting to selectively phase in Dollarama products across categories.

This will be a gradual process, which will continue through to the end of fiscal twenty twenty seven. Along the way, we will be simplifying the price point structure including lowering the current pricing ceiling. In parallel, our plan is to convert store layouts to deliver that convenient and consistent shopping experience we are recognized for and which directly supports our merchandising strategy. Conversion projects are already underway, representing an important step towards laying the groundwork before we can ramp up conversions in fiscal twenty twenty seven and over an approximately three year period. The gradual phase in of our merchandise and store format will introduce elements of the Dollarama brand to our stores in Australia.

Once stores contain a critical mass of Dollarama products, we intend to bring them under the Dollarama banner. We will also leverage our operational excellence to level up IT infrastructure, store and logistics operations and processes. Work on all these fronts will allow us to get the most out of what is from a real estate standpoint, a high quality existing store network across Australia. As a reminder, we currently have three ninety five locations and our long term target is to reach 700 stores in Australia by 02/1934. The goal of the transformation roadmap is to optimize the business and set it up for accelerated growth.

Over the next three to four years, we will be implementing major changes across the business. We will proceed methodically, maintaining a slow and steady approach to ensure execution. As this is a multiyear journey, we don’t expect the business to materially contribute to our profitability until a few years down the road when the heavy lifting is behind us. As a team, we are very excited about these projects and the opportunities that lie ahead across our growth platforms in Canada, in Latin America and now Australia to the benefit of all our stakeholders. With that, I’ll pass it over to Patrick.

Patrick Bowie, CFO, Dollarama: Thank you, Neil, and good morning, everyone. Some housekeeping before we get into our second quarter performance, which includes thirteen days of results from Australia. Following the TRS acquisition, we now have two reportable segments: the Canadian one, which continues to include our Canadian operations and equity investments in Dollarcity and now an Australian one to cover our newly minted Australian operations. This will allow for the tracking of our performance in Canada as before. Note that we won’t be providing guidance for the Australian segment for fiscal twenty twenty six nor will we be disclosing SSS in Australia since we are in the process of developing and implementing an extensive road map to transform the business.

That said, we don’t expect any bottom line contribution from the Australian segment for fiscal twenty twenty six once integration costs are factored in. Our previously issued guidance for fiscal twenty twenty six applied exclusively to our Canadian segment. And with these clarifications, let’s turn now to our second quarter results. In Q2, sales increased 10.3% compared with the same period last year, coming in at over $1,700,000,000 This was primarily driven by 4.9% growth in same store sales in Canada as well as additional revenue from a growing number of stores. As explained earlier, revenue also included contributions from the Australian segment for thirteen days, amounting to $25,700,000 Drilling down on same store sales in Canada, these consisted of a 3.9% increase in the number of transactions and a 0.9% increase in average transaction size.

Strong traffic and demand for consumables were the primary drivers behind this performance in an environment where consumers continue to seek value and to deploy discretionary spend carefully. Our full year guidance for SSS in Canada remains unchanged at between 3% to 4%. However, given our strong performance through the first half of the year, we now expect to be in the upper end of that range. The Canadian consumer remains fragile and cautious on discretionary spending in a context of continued economic uncertainty. We are mindful that this may have an impact on SSS in the second half of the year, a period of historically strong seasonal sales.

Also, remember that we are lapping a fifty three week year, which happens every five to six years and causes a shift in the days that fall into any given quarter. That impact will be felt in Q4 when we will be up against a quarter that included Halloween last year, whereas Halloween falls in Q3 this year. The last time that happened was in fiscal twenty twenty. Consolidated Q2 gross margin was 45.5% of sales in Q2 compared to 45.2% in Q2 last year. The improvement is primarily explained by lower logistics costs.

We continue to expect some headwind pressure on margins through the second half of the year, namely from mix and higher shipping costs. We do, however, now anticipate ending up in the upper end of our annual gross margin guidance range for the Canadian segment of between 44.2% to 45.2% of sales. SG and A represented 14% of sales in Q2 compared to 13.6% for 2025. The increase versus last year is primarily driven by SG and A from the Australian segment, which had a 20 basis point impact. Labor costs are one of the structural differences between our Canadian and Australian segments as these are higher in Australia than in Canada.

SG and A in Q2 also included a 20 basis point impact related to a onetime transaction cost. Guidance expectation for fiscal twenty twenty six SG and A for the Canadian segment remains unchanged at between 14.214.7% of sales. EBITDA was 5 and $88,500,000 compared to $524,300,000 in the 2025. Q2 net earnings increased by 12.5% to $321,500,000 resulting in an increase in diluted EPS of 13.7% to 1.16 The Australian segment had a slightly negative but immaterial impact on net earnings and diluted EPS in the quarter. With our now increasingly global operations, you’ll see an uptick in our effective tax rate of roughly 100 basis points going forward.

Following the TRS acquisition, we are now subject to Pillar two, and we operate in higher tax rate jurisdictions. For Q2, the year over year increase to 27% from 25.1% in Q2 of last year is also explained by a nonrecurring impact of $6,700,000 related to a licensing agreement entered into with Dollarcity for the expansion of the business in Mexico. Dollarcity continued to deliver impressive earnings growth. Our 60.1% share of Dollar City’s net earnings amounted to $38,300,000 this quarter compared to $22,700,000 in the second quarter last year. The year over year increase is driven by strong same store sales, a growing store network, gross margin expansion and increased stake compared to last year.

During the quarter, we used proceeds from our US37.6 million dollars share of the Dollarcity dividend from December to make an initial capital contribution of US18 million dollars for Mexico expansion plans. And just after Q2 ended, the Dollarcity Board approved a second cash dividend of US62.5 million dollars an amount consistent with the previous dividend. Our share of that dividend again corresponds to US37.6 million dollars and is expected to be received in the third quarter. In Q2, we repurchased just over 932,000 shares for a total cash consideration of $174,800,000 We also announced today that the Board approved a quarterly cash dividend of $0.01 $0.58 per share. We intend to continue prioritizing allocating cash to share buybacks to maximize shareholder value subject to market conditions, along with consistent quarterly dividend as part of our balanced capital allocation strategy.

In terms of our debt structure, we completed a 600,000,000 bond offering back in June. The proceeds will notably be used to repay the $250,000,000 bond that comes due this fall. In conclusion, we are pleased with the underlying trends driving our performance so far this year and with our capacity to unlock even more value for our shareholders as we expand internationally. We approach this while remaining mindful of the shifting macro environment and how consumers are adapting to it with a focus on delivering compelling value. Our core Canadian business is strong, growing and profitable.

And with our free cash flow generation and multiple complementary expansion platforms, we have valuable optionality to effectively deploy capital. Through sound capital deployment and disciplined execution across our platforms, we look forward to driving long term growth and value creation for our shareholders. With that, I’ll now turn the call back to the operator for the Q and A.

Conference Call Operator: Thank Our first question comes from the line of Irene Nagel with RBC Capital Markets. Your line is now open.

Irene Nagel, Analyst, RBC Capital Markets: Thanks and good morning everyone. Looking at your same store sales performance year to date of 4.9% versus the guidance, so let’s we can ignore let’s put aside for the moment the low end of 3%, let’s say that for the full year 3.5% to 4% implies deceleration in the back half of the year. Can you talk about what you’re seeing in terms of consumer behavior And why you’re not sort of more optimistic, I guess, for lack of a better way of putting it? Thank you.

Patrick Bowie, CFO, Dollarama: Thanks for the question, Irene. During the first quarter, we’ve seen an inconsistent or we’ve seen inconsistent behavior from the consumer. I mean there were moments of resilience, but there were also moments of fragility. For example, if we look at our seasonal assortment, I mean summer is not over, but the performance was essentially flat. And we expect this, if I could say, unpredictability to continue in the back half of the year.

But you’re correct in saying that with the performance we’ve had in the first half, we were comfortable or we’re comfortable pointing towards the high end of our guidance.

Conference Call Operator: Thank you. Next question from Brian Morrison of TD Cowen. Your line is now open.

Brian Morrison, Analyst, TD Cowen: Thanks very much. I want to focus on TRS and maybe I appreciate the details and it’s early days, but I want you to share with us how we should think about this transition. Should we think about it as the conversion of 100 stores per year? And then can you go into more detail on the merchandise transition? Should we think about it as the nonconverted stores will also be housing Dollarama merchandise, a combo of the two or maintain the TRS sourcing?

Just maybe some details how we should think about that, please.

Neil Rossi, President and CEO, Dollarama: Good morning, Brian. So on the merchandising front, it will be a gradual phase in. The merchants in Canada are working closely with our colleagues in Australia to phase in Dollarama’s import merchandise and to revamp and rework the current domestic offering as well. It will take sometime between now and 2027 to really start feeling more like you’re walking into a Dollarama store is our expectation. Conversions have begun in four stores.

It will be a gradual phase in again over the next several years, each year ramping up the number of store conversions that we’re able to execute as the team gets better, as our bandwidth grows in the country and that expertise is on the ground. We also continue to work on the IT infrastructure and logistics, which have begun to ramp up, but it’s early days as you know. We’re thirteen days in, so that’s about all the color we can share at this point in time.

Conference Call Operator: Thank you. Our next question is from Etienne Ricard of BMO Capital Markets. Your line is now open.

Etienne Ricard, Analyst, BMO Capital Markets: Thank you and good morning. To circle back on Dollarcity, so strong earnings growth with better gross margins, but higher SG and A. Looking forward, how should we think about operating leverage drivers between gross margin and SG and A? And I mean, in other words, how much more headcount do you plan adding as you continue to expand in new geographies?

Patrick Bowie, CFO, Dollarama: Thank you. Yes. I’d say at a high level, I mean, it’s still a business that has a lot of scaling potential. And you could see that when you look at the top line growth, trickling down to bottom line and coming with 60 plus earnings growth. When we highlighted higher labor costs, it’s really a function of higher wages, higher minimum wage increase in those countries, which is still increasing at higher rates than, for example, if compared to Canada.

But aside from that, we continue to expect leverage in every line item, whether in gross margins or in SG and A.

Conference Call Operator: Thank you. Our next question is from Vishal Shreedhar of RBC. Your line is now open.

Brian Morrison, Analyst, TD Cowen: Hi, thanks for taking my question. With respect to Australia, Neil, I wanted to get your thoughts on what the biggest risks are. And as you contemplate implementing the Dollarama model, how should we think about transferring the culture of performance into what is a new venture for you guys with this acquisition?

Neil Rossi, President and CEO, Dollarama: I’m excited by the, I guess, similarity between the two teams and the leadership at what is now I guess Dollar M Australia and no longer TRS. They really have bought into what we’re trying to achieve. And I think over the next few years, the culture will unify. And it’s not it’s something that we focus on and we’re excited by. But I think that the daily work processes and ambitions tend to just become the culture over the course of time.

It’s not like we’re pulling out a manual and the cult the Dollarama cult manual where it’s a daily sort of process. And, I think the Dollarcity experiment for Dollarama many, many, many years ago has turned into an incredibly fantastic partnership and the Dollarcity culture is at one with the Dollarama culture. And I think our goal is to do the very same thing in Australia. There’s going to be ups and downs and I’m sure as a business we’ll only get better as time goes on. Mean even in the early days at Dollarama, we’d go from guardrail to guardrail on any given topic or subject, but we always manage for the overall performance to work well for our shareholder.

And I’m sure the same lessons that we learned along those paths will apply and help us not make those mistakes in Australia. But it’s a new market with a whole bunch of new challenges. So we’ll do the best we can to minimize any of the challenges that arise. But I think we have a great team and I’m quite excited about that business, but it will take time.

Conference Call Operator: Thank you. Our next question comes from the line of John Simparo with Scotiabank. Your line is now open.

John Simparo, Analyst, Scotiabank: Thank you very much. Good morning. I wanted to ask about the tax rates and in particular Pillar two. Can you provide some more color here? Is it fair to assume that’s now a permanent feature?

And any way you can quantify what that might mean for your tax rate moving forward? Thanks

Patrick Bowie, CFO, Dollarama: for the question, John. So, I would first say that we’re now a global business, and it does come with additional tax complexities. And despite the tax efficiency of our structure, I would say that we’re now subject to a higher effective tax rate of, call it, roughly 100 basis points. So we’re operating higher tax jurisdictions. And as you pointed out, as a multinational, we’re now subject to what is called, Pillar two.

But I would also take the opportunity to highlight again that in the tax that you’ve seen this quarter, there is a nonrecurring impact of $6,700,000 just for Q2 related to the granting of an IP license to Mexico, but that should not be assumed in future quarters. At the end of the day, it’s just the cost of doing business as we execute on our ambitions to become a global retailer.

Conference Call Operator: Thank you. Our next question is from Mark Petrie of CIBC. Your line is now open.

Patrick Bowie, CFO, Dollarama: Yes. Thank you. First, Neil, if you ever do put that Cult of Dollarama manual into print, I’d love a copy. Maybe actually I’ll just ask a question just about the supply chain. Obviously, the industry has had some time to adjust, although the new environment clearly remains uncertain.

I’m just curious if you could provide some thoughts on kind of your takeaways for Dollarama from all of that and any risks or opportunities that you see as a result of these shifts? I mean, look, it’s as you know, it’s quite volatile, right? Any political, any trade issues can easily destabilize the logistics chain. But we could only comment on what we’ve seen in Q2. And in Q2, it ran very smoothly.

And that’s one of the reasons why we were able to achieve a higher gross margin percentage. It was frictionless. There was no added costs in the chain. But as you know, we remain vigilant at anything that is, I guess, thrown at the logistics chain. And we looked at last year was a good example of strikes and bottlenecks at ports.

But from what we’ve seen up to now in Q2, none of that has happened, but we need to remain vigilant.

Conference Call Operator: Thank you. Our next question is from Edward Kelly of Wells Fargo. Your line is now open.

John Simparo, Analyst, Scotiabank: Hi, good morning and nice quarter. I have a question for you on just Canadian consumer and behavior. Curious if you think you are getting any benefit from a by sort of Canada approach by consumers over there given the geopolitical backdrop. And then as it pertains to Walmart, Walmart has mentioned that they are ramping price promotional activity in Canada. I’m curious if you’ve experienced that to date or any impact and what a more aggressive Walmart could mean going forward?

Thank you.

Neil Rossi, President and CEO, Dollarama: Sure. So I’ll address the Walmart question. Walmart, Loblaws, everybody understands how competitive the environment is at this point in time with the instability and customers focus on consumables and their base needs. The landscape remains higher level of competition than generally speaking. But that being said, continue to stay focused on remaining the best value relative value in the market.

We can only control our actions and not the actions of others. So our buying team’s job is to stay on top of what market values are and stay ahead of the curve to be the best relative value in our convenient locations and a quicker easier shop. And I think our performance gives us confidence that we’re executing on that promise.

Conference Call Operator: Thank you. Our next question comes from Martin Landry of Stifel. Your line is now open.

Martin Landry, Analyst, Stifel: Hi, good morning. I would like to touch on Mexico a little bit. I know it’s early days, but just would like to hear what you saw some color on the ramp up of your first store. How does it compare to other stores you’ve ramped up in Latin America? How the customer responds?

It’s a new brand in Mexico that’s unknown mostly by most of your consumers. So just a little color to help us understand how the opening has gone would be great.

Patrick Bowie, CFO, Dollarama: Hey, Martin, you’re right. It’s really early days. Look, it’s one store and it’s only been a few weeks. So very, very hard to draw any trends or conclusions here. But from the limited amount of days that we’ve seen, I mean, seems that, it is well received by the Mexican consumer and we’re encouraged by that.

But I will reiterate one store and only a few weeks. So can’t draw any conclusions at this point.

Conference Call Operator: Thank you. Our next question is from Luke Hannan of Canaccord Genuity. Your line is now open.

Luke Hannan, Analyst, Canaccord Genuity: Thanks. Good morning, everyone. I wanted to follow-up on the Canadian segments and specifically the comment that the consumables business was strong as it has been in past quarters, but it sounds like also seasonal products and general merchandise were relatively stable as well. So I mean, can you just frame that up for us? It seems like that’s a continuation of what happened during Q1 as well.

And I mean, is there anything that we can necessarily infer from that as the overall Canadian consumer in a place of stability despite the settlements seems to be depressed? Just maybe a little bit more detail on that.

Patrick Bowie, CFO, Dollarama: Yes. I mean really what we’re seeing in Q2 is a continuation of Q1 and prior quarters. So consumables continuing to perform well. The consumer is still seeking value and trying to remain within its budget, and Dollarama is there for the consumer. And on the other side, when you look at seasonal sales and you go back a few quarters, it’s anywhere between flat, slightly negative, slightly positive.

And so when we look at our summer seasonal, it’s really along the same trend. It’s flat. I mean, summer is not over, but it’s flat. And so all we see is a continuation of that. But like I also, I think, mentioned in one of my first one of the first questions is, there’s some inconsistency in what we’re seeing from the consumers.

At some moment, it seems resilient. At others, it seems fragile. So it’s really hard at this point to draw any trends of the health of the Canadian consumer.

Conference Call Operator: Thank you. Our next question is from Mark Carden of UBS. Your line is now open.

Mark Carden, Analyst, UBS: Good morning. Thanks so much for taking the question. So just in terms of sourcing with some more clarity coming into play on U. S. Tariffs and global products, are you seeing any incremental shifts on the sourcing front?

Any particular opportunities to boost sourcing from any given geographies?

Neil Rossi, President and CEO, Dollarama: Good morning. Not really. We expected this tariff discussion to be relatively short lived like we were hoping two years or less. And while we’ve looked at other markets, we have to be realistic that the importation of goods from almost anywhere but The U. S.

Or Canada is a three to six month project. And so while we’ve done our work on the few items that would be alternatives from the goods we buy from The U. S. It hasn’t been a huge push because the majority of the goods that we buy from The U. S.

Are national brands and those national brands can’t be replaced with private label imports. It’s just not the nature of those products. So when you’re talking about Pepsi and Frito Lay and Nestle and Hershey, it is what it is. But where we’re talking about plastic molded items or other goods that were made in The U. S, those goods have been transferred to other countries because, namely Canada because the 25% tariff of course, was highly prohibitive.

Conference Call Operator: Thank you. Our next question is from Cory Tarlow of Jefferies. Your line is now open.

Neil Rossi, President and CEO, Dollarama0: Great. Thank you for taking my question. I was just curious on the Reject Shop acquisition. It does seem like there’s a lot of exciting plans that you have ahead for the business. But if you were to bucket the initiatives that you have in terms of maybe like layups versus mid range jump shots or contested threes or how you think about what’s kind of the lower hanging fruit versus not?

Would just be curious to get kind of your thoughts and as well around I believe Neil you made a comment around the pricing changes that you’re looking to make. How should we be thinking about the opportunity there versus what exists in that business today? Thank you.

Neil Rossi, President and CEO, Dollarama: So Corey, I think we like to think of it as an overall game. So there’s no focus on any particular shot. There’s a focus on all the shots, all the plays, all the layups. So what we’re doing because it’s such a big undertaking is we’re commencing the process in all parts of the business. Some will be easier and faster execute and others a longer slog, but it all needs to get done.

And so it’s all commenced simultaneously. And clearly having the correct assortment is going to be the true driver of what differentiates us from the retail market or existing retail market in that country. And I would argue the retail market in all countries we’re in. So a focus by the buying teams here and there on getting our assortment into the Australian market is my priority number one. But regardless of whether it’s my priority number one, all of the different pieces of the sort of conversion of the existing business into what we wish to see in the future has begun.

Conference Call Operator: Thank you. This concludes the Q and A session. Thank you all for your participation. This does conclude today’s call. You may now disconnect.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.