Dollarama Inc raised its full-year same-store sales forecast on Wednesday, as the Canadian discount store chain benefited from inflation-weary consumers shopping at its stores in search of cheaper groceries and household supplies.
Montreal-based Dollarama has seen robust demand for consumables such as snack bars, chocolates and beverages, and also rolled out additional price points up to C$5 to expand the range of products.
The company's US counterpart Dollar Tree Inc raised its annual net sales forecast in November, while Dollar General Corp said last week that its full-year same-store sales would be toward the upper end of its previous estimate.
Dollarama said it now expects comparable store-sales growth between 9.5% and 10.5% for fiscal 2023, up from prior forecast of 6.5%-7.5%.
The company also narrowed its forecast range for full-year gross margin to a range of 43.1% to 43.6%, from prior estimate of 42.9% to 43.9%.
The company's third-quarter net sales rose 14.9% to C$1.29 billion (€900 million), compared with analysts' average estimate of C$1.23 billion (€850 billion), according to IBES data from Refinitiv.
It reported a profit of 70 Canadian cents per share for the quarter ended 30 October, in line with Wall Street estimates.
In September of this year, it raised its full-year same-store sales forecast after topping quarterly revenue estimates, helped by strong demand for its groceries and household essentials as more consumers turn to discount stores amid surging inflation.