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Dollarama Q4 Gains Driven by Increased Store Count

Financials were only slightly affected by pandemic-related challenges
Emily Crowe, Progressive Grocer
Dollarama Q4 Affected by COVID-19 Public-Health Measures
Canadian retailer Dollarama saw sales increase by 11% in its fourth quarter.

Canadian retailer Dollarama is no stranger to fourth quarter sales gains, and this year’s reporting has proven to be no different. For its fourth quarter of fiscal 2022, which ended Jan. 31, the company saw an 11% increase in sales to $1,224.9 million*, compared to $1,103.7 million for the fourth quarter of fiscal 2021. 

Dollarama attributes the sales increase to comparable store sales, as well as new sites opened over the past 12 months, which took its total store count from 1,356 to 1,421. Comparable store sales increased by 5.7%, compared to the fourth quarter of 2021, reflecting a 4% decrease in average transaction size and a 10.1% increase in the number of transactions. The increase in comparable store sales is partially thanks to strong seasonal product sales compared to the same period last year when there was a temporary ban on non-essential item sales in Quebec. 

A change in sales mix during the fourth quarter of fiscal 2022 caused a slight drop in gross margin to 45.2% of sales, compared to 45.5% of sales in the fourth quarter of fiscal 2021. 

General, administrative and store operating expenses decreased by 4.4% to $178 million, partially driven by lower pandemic-related costs and also partially offset by the costs associated with operating a larger number of stores. 

For the full fiscal year 2022, sales increased by 7.6% to $4,330.8 million, compared to $4,026.3 million in fiscal 2021. Comparable store sales grew 1.7% over and above 3.2% growth in fiscal 2021, and gross margin increased very slightly for the same time period. 

"Dollarama delivered strong operational and financial results in fiscal 2022, including EPS growth of 20%, all this while navigating the ebb and flow of the pandemic's impacts on retailers and consumer shopping patterns and in the context of supply chain and inflationary pressures,” said Neil Rossy, president and CEO. “This remarkable performance speaks to the resilience of our business model and the relevance of our value promise to Canadian consumers, a promise we are committed to fulfilling in what remains a complex and volatile environment as we enter fiscal 2023." 

For fiscal 2023, Dollarama expects to open 60 to 70 net new stores and see comparable sales growth between 4% and 5%. The company also plans to roll out additional price points up to $5 as part of its strategy to maintain and enhance its value and product assortment. 

Montreal-based Dollarama operates stores throughout Canada. The company is No. 68 on the PG 100, Progressive Grocer’s 2021 list of the top food and consumables retailers in North America.

* All financial figures represent Canadian dollars

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