The Numbers
Dollarama Inc. (TSX: DOL) delivered consolidated sales of $2,026.6 million for the 13-week period ended August 2, 2026, a 17.6% increase over $1,723.8 million in the prior-year quarter. Canadian comparable store sales rose 5.4% — split between a 3.7% lift in transaction count and a 1.7% gain in average transaction size — accelerating from 4.9% growth posted in the same period a year earlier. The comp performance was fueled by sustained demand in consumables and general merchandise, two categories that have proven resilient as households remain price-conscious.
EBITDA increased 11.0% to $653.0 million, though the EBITDA margin contracted to 32.2% from 34.1% a year ago. Management attributed the margin pressure entirely to consolidating a full quarter of the Australian segment — whose gross margin of 32.4% and SG&A ratio of 28.1% of sales run well below Canadian norms — versus only 13 days of Australian results captured in the year-ago period. Stripping out Australia, the Canadian segment posted an EBITDA margin of 34.9%, up from 34.5%, with SG&A holding flat at 13.8% of sales. Net earnings rose 8.7% to $349.3 million, and diluted EPS increased 11.2% to $1.29 — even absorbing a $0.05 per-share drag from the Australian segment.
Australia & Dollarcity
The Australian segment, operating 414 stores under the legacy Reject Shop banner as of August 2, 2026, contributed $184.8 million in quarterly sales. Dollarama renovated 25 stores and opened 4 net new locations during the period, bringing locations fitted with its layout and fixtures to 60. Management confirmed it expects a net loss for Australia in fiscal 2027 as the business transformation progresses; the segment recorded a net loss of $13.8 million in Q2. The operator is funding the overhaul while simultaneously expanding — a capital-intensive posture that is suppressing consolidated margins in the near term but extends the unit-growth runway.
Dollarcity, the Latin American value retail venture in which Dollarama holds a 60.1% stake in the Central American entity (CARS) and 80.05% of the Mexican vehicle (ICM), contributed $49.9 million in equity earnings for the period from April 1 to June 30, 2026. CARS earnings jumped 39.7% year over year, driven by a 30.0% sales increase as Dollarcity's total store count grew from 658 to 781 locations across Colombia, Guatemala, Peru, El Salvador, and Mexico over the trailing twelve months. Mexico remains an investment-stage market; ICM posted a net loss of $5.7 million in the period. Subsequent to quarter-end, Dollarama received a US$75.1 million dividend from CARS and redeployed US$38.0 million into a capital call supporting ICM's Mexico expansion.
Guidance & Capital Return
Management raised the fiscal 2027 Canadian comparable store sales guidance range to 4.0%–4.5% from the original 3.0%–4.0%, and nudged the net new store opening target to 65–75 units from 60–70. Gross margin guidance of 45.0%–45.5% and SG&A guidance of 14.1%–14.6% were left unchanged, as was the capital expenditure range of $420.0 million to $470.0 million for the Canadian segment.
On the capital return front, Dollarama repurchased 1,596,016 shares at a total cost of $300.4 million — a weighted average price of $188.23 per share — under its normal course issuer bid during the quarter. The board also declared a quarterly dividend of $0.1200 per common share, payable November 6, 2026. The value-retail operator's ability to sustain aggressive buybacks alongside a multi-market store-opening program underscores the cash generation capacity of the 1,734-unit Canadian fleet. For operators and retailers tracking value-segment dynamics, Dollarama's accelerating Canadian comps signal that consumer trade-down trends remain firmly in place heading into the back half of calendar 2026, a trend with direct implications for foodservice operators competing for share of wallet in the everyday consumables category.
Written by Michael Politz, Author of Guide to Restaurant Success: The Proven Process for Starting Any Restaurant Business From Scratch to Success (ISBN: 978-1-119-66896-1), Founder of Food & Beverage Magazine, the leading online magazine and resource in the industry. Designer of the Bluetooth logo and recognized in Entrepreneur Magazine's "Top 40 Under 40" for founding American Wholesale Floral, Politz is also the Co-founder of the Proof Awards and the CPG Awards and a partner in numerous consumer brands across the food and beverage sector.
