Dollarama announces renewal of its normal course issuer bid
MONTREAL, June 12, 2013 /PRNewswire/ - Dollarama Inc. (TSX: DOL) ("Dollarama" or the "Corporation") announced today that it received approval from the Toronto Stock Exchange ("TSX") respecting the renewal of its normal course issuer bid to purchase for cancellation up to 3,364,523 of its common shares, or 5% of the public float of 67,290,467 common shares as at May 31, 2013. As at the same date, there were 73,161,732 common shares issued and outstanding.
The repurchase program - starting on June 17, 2013 and ending no later than June 16, 2014 - will be conducted through the facilities of the TSX or alternative trading systems, if eligible, and will conform to their regulations.
The average daily trading volume of the common shares over the period between December 1, 2012 and May 31, 2013, as calculated per the TSX rules, was 267,484 common shares. Consequently, under TSX rules, Dollarama will be allowed to purchase daily, through the facilities of the TSX, a maximum of 66,871 common shares representing 25% of such average daily trading volume. In addition, Dollarama may make, once per week, a block purchase (as such term is defined in the TSX Company Manual) of common shares not directly or indirectly owned by insiders of Dollarama, in accordance with TSX rules. The shares purchased pursuant to the normal course issuer bid will be cancelled.
Purchases under the normal course issuer bid will be made by means of open market transactions or such other means as the TSX or a securities regulatory authority may permit, including pre-arranged crosses, exempt offers and private agreements under an issuer bid exemption order issued by a securities regulatory authority.
The price to be paid by Dollarama for any common share will be the market price at the time of acquisition, plus brokerage fees, or such other price as the TSX may permit. In the event that Dollarama purchases common shares by pre-arranged crosses, exempt offers, block purchases or private agreements, the purchase price of the common shares may be, and will be in the case of purchases by private agreements, at a discount to the market price of the common shares at the time of the acquisition.
Dollarama also announced that it has entered into an automatic purchase plan agreement ("APP") with a broker to allow for the purchase of its common shares under the NCIB at times when Dollarama ordinarily would not be active in the market due to self-imposed trading blackout periods. Before entering into a blackout period, Dollarama may, but is not required to, instruct the designated broker to make purchases under the NCIB in accordance with the terms of the APP. Such purchases will be determined by the broker in its sole discretion based on parameters established by Dollarama prior to the blackout period in accordance with TSX rules, applicable securities laws and the terms of the APP. The terms of the APP have been pre-cleared by the TSX. Outside of these pre-determined blackout periods, common shares will be purchased in accordance with management's discretion.
Under the normal course issuer bid which will end on June 14, 2013, Dollarama purchased and cancelled 2,583,264 common shares, representing 3.5% of the common shares issued and outstanding as of June 1, 2012, at a weighted average price of $60.36 per common share.
The Board of Directors of Dollarama believes that the purchase by Dollarama of its common shares represents an appropriate and desirable use of its available cash to increase shareholder value.
Dollarama is Canada's leading dollar store operator with 806 locations across the country. Our stores provide customers with compelling value in convenient locations, including metropolitan areas, mid-sized cities and small towns. Dollarama aims to provide customers with a consistent shopping experience, offering a broad assortment of everyday consumer products, general merchandise and seasonal items. Products are currently sold in individual or multiple units at select fixed price points up to $3.00.
This news release may contain forward-looking statements. Forward-looking statements are based on information currently available to us and on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate and reasonable in the circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct. Many factors could cause our actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the following factors, which are discussed in greater detail in the "Risks and Uncertainties" section of the Corporation's management's discussion and analysis (MD&A) for Fiscal 2013 and in its continuous disclosure filings (available on SEDAR at www.sedar.com): future increases in operating and merchandise costs, inability to sustain assortment and replenishment of our merchandise, increase in the cost or a disruption in the flow of imported goods, disruption of distribution infrastructure, inventory shrinkage, inability to renew store, warehouse, distribution center and head office leases on favourable terms, inability to increase our warehouse and distribution center capacity in a timely manner, seasonality, market acceptance of our private brands, failure to protect trademarks and other proprietary rights, foreign exchange rate fluctuations, potential losses associated with using derivative financial instruments, level of indebtedness and inability to generate sufficient cash to service our debt, interest rate risk associated with variable rate indebtedness, competition in the retail industry, current economic conditions, failure to attract and retain qualified employees, departure of senior executives, disruption in information technology systems, unsuccessful execution of our growth strategy, holding company structure, adverse weather, natural disasters and geo-political events, unexpected costs associated with our current insurance program, litigation, product liability claims and product recalls, and environmental and regulatory compliance.
These factors are not intended to represent a complete list of the factors that could affect us; however, they should be considered carefully. The purpose of the forward-looking statements is to provide the reader with a description of management's expectations regarding the Corporation's financial performance and may not be appropriate for other purposes; readers should not place undue reliance on forward-looking statements made herein. Furthermore, unless otherwise stated, the forward-looking statements contained in this news release are made as of June 12, 2013, and we have no intention and undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
SOURCE Dollarama Inc.