The North West Company Inc. Announces Second Quarter Earnings and an Increase in the Quarterly Dividend

Core Viewpoint - The North West Company reported a slight increase in consolidated sales for the second quarter of 2025, despite facing significant challenges from community evacuations due to wildfires, decreased funding from Jordan's Principle, and a softer economy, particularly in Alaska markets. The company remains committed to its "Next 100" strategy to drive sustainable value for customers and shareholders [2][3]. Financial Highlights - Consolidated sales for the second quarter increased by 0.1% to $647.0 million compared to $646.5 million last year, driven by higher Canadian sales and new stores [3]. - Food sales decreased by 0.8%, while general merchandise and other sales increased by 2.8%, attributed to higher third-party airline revenue and pharmacy sales in Canada [3]. - Same store sales decreased by 1.1%, contrasting with a 4.3% gain in the same quarter last year, primarily due to a 1.8% decrease in Canadian Operations [3]. Gross Profit - Gross profit increased by 0.1% to $219.9 million, maintaining a gross profit rate of 34.0% [4]. Expenses - Selling, operating, and administrative expenses decreased by $0.1 million or 0.1% compared to last year, with a notable decrease in share-based compensation costs [5]. - Excluding share-based compensation and one-time costs related to the Next 100 strategy, expenses increased by $2.2 million or 1.4% compared to last year [5]. Earnings - Earnings from operations (EBIT) increased by 0.5% to $55.2 million, while EBITDA rose by 2.1% to $85.2 million [6]. - Net earnings increased by 1.9% to $37.6 million, with diluted earnings per share rising to $0.74 from $0.73 last year [9]. Interest and Tax Expenses - Interest expense decreased by 0.5% to $4.3 million due to lower interest rates and average debt [7]. - Income tax expense decreased to $13.2 million, with the effective tax rate dropping to 26.0% from 27.0% last year [7][8]. Company Profile - The North West Company operates 229 stores across Canada, Alaska, the South Pacific, and the Caribbean, with annualized sales of approximately CDN$2.6 billion [27].