Dollarama Inc. said it had seen a surge in current-quarter sales as consumers stocked up on everyday essentials fearing lockdowns due to the coronavirus pandemic, but suspended its current fiscal-year forecast.

The discount retailer typically includes a fiscal year outlook along with its fourth-quarter and full-year results, which the company released on April 1.“Due to the exceptional circumstances stemming from the global COVID-19 pandemic and our limited visibility on future performance, we have suspended this practice for now,” said chief financial officer Michael Ross in a conference call with analysts. The retailer will revisit that decision ahead of its first-quarter earnings release, he said, “should the situation normalize by then.”

Several countries have asked people to stay at home and avoid social gatherings to stop the spread of the virus that has taken the lives of 42,000 globally. In Canada, over 8,000 cases and 101 deaths have been reported. 

Dollarama was deemed an essential service in areas where non-essential businesses were ordered to shut operations, and roughly 54 of the company’s 1,291 stores remain closed temporarily. Most of these, Mr. Ross said, are in shopping malls in Quebec that have been asked to close down. The company is working to keep its shelves well-stocked in stores. After halting production for weeks in February, Dollarama’s overseas suppliers resumed operations and are ramping up production, the company said.

Dollarama said sales rose in the first few weeks of the current quarter, but that was followed by lower traffic due to public health measures directing Canadians to stay home as much as possible. “In the current unprecedented situation, we cannot predict how shopping patterns will evolve,” Chief Executive Officer Neil Rossy said. 

Fourth Quarter Highlights:

  • Dollarama earned $178.7 million or 57 cents per diluted share, up from $171 million or 53 cents per diluted share in the same period a year earlier.
  • Sales for the 13-week period ended Feb. 2 totalled nearly $1.07 billion, up from nearly $1.06 billion in a 14-week period ended Feb. 3, 2019.
  • Same-store sales for the period grew 2%, or 3.8% excluding the impact of a calendar shift that saw the fourth-quarter of 2019 have one additional week.

Source: Globe & Mail
Source: The Star
Source: Financial Post