Discount store Dollarama Inc. reported higher sales and profit in its latest quarter as pandemic restrictions lifted and the consumer hunt for value increased amid soaring inflation, the retailer said Wednesday.
The company posted a first-quarter profit of $145.5 million, up from $113.6 million in the same quarter last year, as its sales rose 12.4%.
The result came as spending patterns appeared to shift in the quarter ended May 1 as customers shopped more often, but bought less with each visit compared with a year ago.
The trend was reflected in a 14.4% increase in the number of transactions while the transaction size dropped 6.2%, the company said.
Dollarama president and CEO Neil Rossy said the store saw an increase in shoppers and high demand for everyday consumables and seasonal products.
"With the lifting of COVID-19 restrictions across Canada early in the quarter, we were pleased to see a double-digit increase in customer traffic," he said.
"Our strong performance across key metrics in the first quarter reflects the relevance of our business model and positive consumer response to our value proposition in a high-inflation environment."
The company will continue to work to mitigate ongoing supply chain and cost pressures to provide consumers with the best relative value on the market, Rossy added.
Dollarama's profit amounted to 49 cents per diluted share for the quarter, up from a profit of 37 cents per diluted share in the same quarter a year earlier.
Sales in the first quarter of the company's 2023 financial year totalled $1.07 billion, up from $954.2 million. Comparable store sales rose 7.3%.
The Montreal-based retailer has 1,431 stores in Canada, including 10 net new stores that opened in its most recent quarter.
The company also owns a 50.1% equity stake in Dollarcity, a Latin American discount retailer with 358 stores in Colombia, Guatemala, El Salvador and Peru.