The North West Company (NWC) Q3 2025 earnings summary

Executive summary

• Consolidated sales grew 3.3% year-over-year to $637.5 million, driven by same-store growth and new stores, but partially offset by lower wholesale and airline revenues.

• Gross profit increased 4.3% due to higher sales and a 30 bps improvement in gross profit rate from sales mix changes.

• Net earnings decreased 4.3% to $36.4 million, impacted by higher operating expenses, increased depreciation, and a higher effective tax rate from new global minimum tax legislation.

• Adjusted EBITDA rose 1.4% to $88.4 million, but bottom-line growth was offset by increased costs and softer results in certain segments.

• Board declared a quarterly dividend of $0.40 per share, payable January 15, 2025.

Financial highlights

• Canadian sales rose 4% (4.9% same-store), with food up 4.8% and general merchandise up 5.3% on strong prior-year comps.

• International sales increased 2.3%, with same-store food up 2.4% and general merchandise up 5.2%.

• EBIT decreased 2.9% to $54.1 million, while EBITDA increased 0.6% to $83.4 million year-over-year.

• Adjusted EBITDA margin was 13.9% of sales versus 14.1% last year.

• Diluted EPS was $0.72, down from $0.77 in the prior year quarter.

Outlook and guidance

• No acceleration in sales expected for Q4; current trajectory anticipated to continue.

• Incremental EBIT from Next 100 initiatives expected to ramp up in 2025 and beyond, with more details on one-time costs to be provided in future quarters.

• Management remains optimistic about operational improvements and merchandise refinement to address economic challenges, especially in International Operations.

• Economic uncertainty remains, especially in tourism-dependent international markets and areas lacking strong government support.

• Forward-looking statements highlight ongoing risks from economic, political, and market factors, as well as regulatory and tax changes.