Dollarama (DOL) Q2 2025 earnings summary

Executive summary

• Q2 FY2025 delivered strong results with sales up 7.4% to $1,563.4 million, EPS up 18.6% to $1.02, and comparable store sales up 4.7% year-over-year, despite normalization from last year’s high growth.

• Dollarcity expanded rapidly, opening 23 net new stores in Q2 to reach 570 across four LATAM countries, and plans to enter Mexico by 2026.

• Increased ownership in Dollarcity to 60.1% during Q2, with an option to acquire further stakes and expanded partnership to include Mexico.

• Dollarama maintains a disciplined, capital-efficient growth model, targeting 2,000 Canadian and 1,050 Dollarcity stores by 2031.

• ESG initiatives advanced, including energy efficiency upgrades and improved ESG risk ratings.

Financial highlights

• Gross margin improved to 45.2% from 43.9% year-over-year, mainly due to lower shipping and logistics costs.

• EBITDA rose 14.7% to $524.3 million, with margin expanding to 33.5%; net earnings increased 16.3% to $286 million.

• SG&A as a percentage of sales was 13.6%, flat year-over-year.

• Dollarcity’s net earnings contribution nearly doubled to $22.7 million.

• 2,104,691 shares repurchased for $263.1 million; quarterly dividend declared at $0.0920 per share.

Outlook and guidance

• Fiscal 2025 guidance unchanged: 60–70 net new stores, comparable store sales growth of 3.5%–4.5%, gross margin 44.0%–45.0%, SG&A at 14.5%–15.0% of sales.

• Dollarcity to pilot first store in Mexico in 2026, with further expansion potential.

• Guidance assumes stable economic, labor, and retail conditions, and continued positive customer response.

• Q3 SSS expected to normalize toward the full-year range; key Halloween sales days will shift to Q4.