The North West Company Inc. Announces Third Quarter Earnings and a Quarterly Dividend

Core Viewpoint - The North West Company Inc. reported a decrease in sales for the third quarter but achieved double-digit earnings growth due to margin improvements and lower expenses, highlighting the strength of its business model despite a challenging sales environment [2][3]. Financial Highlights - Sales: Third quarter consolidated sales decreased by 0.5% to $634.3 million from $637.5 million last year, primarily due to a 1.7% decrease in same store sales in Canadian Operations, which was partially offset by foreign exchange impacts and new store sales [3]. - Gross Profit: Gross profit increased by 1.4% to $217.1 million compared to $214.1 million last year, attributed to a 64 basis point increase in gross profit rate [4]. - Expenses: Selling, operating, and administrative expenses decreased by $1.6 million or 1.0% compared to last year, largely due to a reduction in share-based compensation costs [5]. - Earnings from Operations: Earnings from operations (EBIT) rose by 8.5% to $58.7 million, while EBITDA increased by 6.5% to $88.9 million [6]. - Interest Expense: Interest expense decreased by 7.4% to $4.6 million due to changes in interest rates and average debt [7]. - Income Tax Expense: Income tax expense increased to $13.1 million, with a decrease in the effective tax rate to 24.2% [8]. - Net Earnings: Net earnings increased by 12.9% to $41.1 million, with diluted earnings per share rising to $0.82 from $0.72 last year [9]. Non-GAAP Financial Measures - The company reported adjusted EBITDA of $91.9 million, an increase of 3.9% compared to the previous year, and adjusted net earnings of $43.3 million, up 8.1% [6][9]. Company Profile - The North West Company Inc. operates 230 stores across Canada, Alaska, the South Pacific, and the Caribbean, with annualized sales of approximately CDN$2.6 billion [26].