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Tag: the reject shop

  • Dollarama Australia Sales Reach $185.7M as Conversion Losses Widen

    Dollarama Australia Sales Reach $185.7M as Conversion Losses Widen

    Dollarama Australia posted a second-quarter net loss of $13.7 million for the period ended August 2 as costs from overhauling its local retail network accelerated.

    Sales rose to $185.7 million across 414 locations, up from $262,400 in net loss and a fraction of revenue a year earlier when accounts reflected only 13 days of ownership.

    Refitting The Reject Shop Network

    The Montreal-based value retailer took full control of The Reject Shop last July to establish a direct operating bridgehead in the Asia-Pacific region. Integrating those assets requires extensive capital work inside existing retail footprints.

    During the quarter, the company renovated 25 stores and opened four net new sites across the country. That pushed the total number of Australian locations operating with Dollarama standard layouts and fixtures to 60.

    Discount Margins Face Upfront Outlays

    Refurbishing discount outlets at speed exposes margins to immediate friction. Fit-out costs, supply chain realignment and temporary store disruption hit operating profit before new merchandising yields higher basket sizes.

    Rival value generalists in Australia operate lean supply chains and defend established suburban leases aggressively. Dollarama is betting that higher product density and proprietary sourcing can offset the conversion drag across its remaining 354 legacy stores.

    Full Year Loss Forecast

    The company acquired The Reject Shop in July 2025 to secure an instant national retail footprint rather than building real estate step by step. That transaction gave the Canadian group 414 operating sites across suburban centres and strip malls.

    Dollarama confirmed it expects the Australian business to remain loss-making for the entire fiscal year as refits continue across the balance of the 414-store fleet.

  • The Reject Shop downgrades guidance

    The Reject Shop downgrades guidance

    The Reject Shop on Thursday announced that chief executive Ross Sudano will depart the business in the near term. The news came as the discount retailer downgraded its profit guidance for the year from $3.1 million in the black to a loss of between $1 million and $2 million.

    Sudano has led the business through a period of rapid change since he was appointed CEO in 2014.

    “After a period of consolidation of the significant growth undertaken by the company, the board, in conjunction with Ross, has determined that this is an appropriate juncture to seek a new chief executive to guide the company through the next phase of its growth and bring renewed energy and vigor to the role,” The Reject Shop chairman Bill Stevens said.

    “Notwithstanding the current challenges facing the business, we continue to have confidence in the company’s long-term prospects and the opportunities for a new CEO to deliver a refreshed product range that will appeal to a broader customer base.”

    In the short term, Sudano will be temporarily replaced by the general manager of the supply chain, strategy, and innovation Dani Aquilina, who will lead the company as acting chief executive.

    Aquilina has been with the business for 12 years and has overseen a number of key supply chain transformations, including optimizing its international network, and the construction of new distribution centers.

    In addition to Sudano’s departure, The Reject Shop’s board has also appointed two new directors to its board.

    Zac Midalia will represent the company’s largest shareholder, Allensford Pty Ltd, which failed to acquire the struggling discount chain but gained an 18.99 percent voting power as a result of its takeover attempt, while Steven Fisher will act as an independent board member.

    Both will join the board on June 14, which will see a significant board renewal completed – with four out of six members having joined in the last nine months.

    The reduced guidance is a result of a difficult trading environment, the retailer said in a statement to the Australian Securities Exchange, in which low consumer confidence, flat wages, increases in the cost of living and a rapidly falling housing sector have driven sales well below expectations.

    As a result, comparable sales are down 2.7 percent – slightly above the year to date figure, which is down 2.9 percent.

    Gross margins in the second half are “well below expectations”, exacerbated by the competitive pricing pressure being placed on the business from both supermarket and department store rivals – forcing price roll-backs across a number of key lines as the business seeks to maintain its price gap in the market.

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