Dollarama's Q4 Beats, Australia Expansion Weighs

0:00Dollar-Rama beat expectations in its fourth quarter, with adjusted earnings per share of $1.43 – up 2.1% from last year. Revenue hit $2.1 billion, a solid 11.7% increase. Still, shares dropped after the company gave a cautious outlook for fiscal 2027, mainly due to costs from its Australian expansion. The big issue is the overhaul of its reject-shop chain down under. Revenue plans to spend about $45 million on capital projects, plus $35 to $45 million in operating expenses. This will drag earnings per share by 15 to 20 cents next year, more than expected, as they revamp products, stores, and sourcing. In Canada, the core business held steady, with comparable store sales of 1.5%, shoppers spend more per trip, up 3.1%, but visited less often, down 1.6%. Other and calendar shifts hurt results, but adjusted for those, sales growth look closer

1:02to 3.5%. Higher crude oil prices from global tensions are pushing up sourcing and transport costs, leading to slight gross margin dips to 46.6%. The company aims to pass and cost the customers without losing its value edge, while efficiencies help offset pressures. Looking ahead, Dollar-Rama balances short-term hits from Australia, and costs against the resilient home market and global growth potential. Investors watch closely as it tests its model overseas. This has been Toronto News Today, powered by AI. I'm Corey with The Story.