Canadian retail chain Dollarama has announced a significant 20% growth in net earnings for the first quarter (Q1) of fiscal year 2025 (FY25), reaching C$215.8m ($157.17m), compared with C$179.9m in Q1 FY24. 

The company's diluted earnings per share (EPS) also rose from C$0.63 in Q1 FY24 to C$0.77 in Q1 FY25. 

During the quarter ending 28 April 2024, sales of Dollarama increased 8.6% to C$1.40bn from C$1.29bn in the same quarter of the previous year. 

The growth is attributed to the expansion of Dollarama's store network from 1,507 to 1,569 year-on-year, and a 5.6% increase in comparable store sales. 

The increase in comparable store sales was driven by an 8.7% rise in the number of transactions, despite a 2.8% decrease in the average transaction size.  

This follows a 17.1% growth in comparable store sales in the same period of 2023  

Dollarama's gross margin also improved, reaching 43.2% of sales compared to 42.2% in the previous fiscal year's first quarter. 

The company's earnings before interest, taxes, depreciation, and amortisation (EBITDA) for Q1 FY25 was C$417.7m, or 29.7% of sales, showing an improvement from C$366.3m and an EBITDA margin of 28.3% in the same quarter of the previous year.  

However, its selling general and administrative expenses saw an 11.0% increase to C$217.2m. 

Dollarama president and CEO Neil Rossy said: "As anticipated, we are seeing a progressive normalisation in comparable store sales, with growth primarily driven by persistent higher than historical demand for core consumables and other everyday essentials.  

“As Canadian consumers continue to seek out compelling value for their hard-earned money, we will remain focused on executing on our value and convenience promise.” 

Looking ahead to the full year 2025, Dollarama anticipates comparable store sales growth of between 3.5% and 4.5%, with a gross margin forecast of between 44% and 45%.