Reitmans (Canada) Limited

Second-quarter net revenues were $211.8 million, down 1.9% year over year, and comparable sales decreased 1.5%. Gross profit increased $1.1 million to $123.9 million, with gross margin up 160 basis points to 58.5%. Adjusted EBITDA was $18.8 million, down from $21.4 million, and net earnings were $10.1 million, or $0.20 per share, versus $13.1 million, or $0.26 per share, a year ago. For the year to date, management said adjusted EBITDA is up $2.7 million, or 25%, and net earnings are up $700 thousand, or 22.6%. Looking ahead, management did not provide numeric forward guidance on the call, but said higher fuel costs and broader geopolitical volatility are likely to remain a near-term headwind and that the company will continue focusing on gross margin, inventory discipline, and strategic investments.

Andrea Limbardi said the quarter reflected a deliberate shift toward better pricing, more selective promotions, and tighter inventory management, which helped drive the 160-basis-point gross margin improvement. She emphasized resilience in the store network and highlighted brand-specific momentum, including Reitmans’ 100th anniversary campaign, stronger performance at renovated flagship stores, and growing traction at Penningtons and RW&CO. Her tone was constructive, but she also acknowledged that higher fuel costs and freight pressures may persist and are difficult to predict.

Caroline Goulian laid out the financial bridge clearly: net revenues of $211.8 million, gross profit of $123.9 million, adjusted EBITDA of $18.8 million, and net earnings of $10.1 million or $0.20 per share. She attributed the lower EBITDA to a $4.5 million rise in SG&A, including a $1.6 million increase in store-related rent/occupancy and other costs, a $2.1 million increase in advertising and freight, and $1.2 million of project spending tied to loyalty and digital work; wages were down $400 thousand due to workforce reduction. She also pointed to a strong balance sheet, with $149.2 million in working capital, $152.7 million in cash, inventory down 5.2% to $119.7 million, no long-term debt other than lease liabilities, and no bank borrowings; year to date, the company repurchased 295,000 shares for $600 thousand and renewed its NCIB for up to 3 million shares.

There were no analyst questions during the Q&A session, so there was no additional management discussion on demand trends, margins, or outlook beyond the prepared remarks. The main forward-looking comments from management centered on continued near-term pressure from higher fuel costs and freight volatility, while reiterating the focus on strategy execution, margin discipline, and brand-building investments.