April 1, 2020 / 11:56 AM / 2 months ago

Dollarama sees sales surge on stockpiling; suspends fiscal 2021 forecast

FILE PHOTO: A Dollarama store is pictured in Toronto, Ontario, Canada, June 5, 2018. REUTERS/Carlo Allegri

(Reuters) - Canadian dollar-store operator Dollarama Inc (DOL.TO) 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.

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 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.

He said, as an essential business, 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.

For the fourth quarter, Dollarama’s net sales rose marginally to C$1.07 billion ($752.09 million) in the fourth quarter ended Feb. 2. Analysts were expecting C$1.06 billion, according to IBES data from Refinitiv.

Reporting by Nivedita Balu in Bengaluru; Editing by Shailesh Kuber

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