Canada's North West Company Q4 sales edge up

Overview

• Canada food and everyday goods retailer's fiscal Q4 sales rose 0.1% yr/yr

• Adjusted EBITDA for fiscal Q4 increased 1.3% yr/yr

• Net earnings and EPS for fiscal Q4 declined yr/yr

Outlook

• North West says it remains focused on Next 100 initiatives amid uncertain economic conditions

Result Drivers

• CANADIAN SALES PRESSURE - Co said lower sales in Canadian Operations were due to reduced funding from First Nations Child and Family Services programs and lower settlement payments, partially offset by some positive impact from other settlement payments

• INTERNATIONAL GROWTH - International Operations same store sales rose 5.6% due to improved economic conditions in tourism-dependent markets and market share gains in Alaska

• GROSS PROFIT RATE DECLINE - Gross profit fell due to a lower gross profit rate, mainly from changes in sales blend, higher markdowns, inventory shrink, and maintenance costs

Company press release: ID:nGNX4dpMD8

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the food retail & distribution peer group is "buy"

• Wall Street's median 12-month price target for North West Company Inc is C$58.50, about 12% above its April 7 closing price of C$52.22

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 13 three months ago

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