Groupe Dynamite Inc "Top 10 Questions for Management" (Buy) Serna

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Groupe Dynamite Inc "Top 10 Questions for Management" (Buy) Serna

avior patterns across both Q1E 0.46 0.45

markets considering each region is dealing with its own share of macro Q2E 0.77 0.82

headwinds? Excluding store opening dynamics, what are comparable sales trends Q3E 0.94 0.94

in each region? How is Dynamite performance affecting Canada trends? Q4E 0.99 0.92

01/27E 3.15 3.16

4. Sustainability of peak margins and near-term levers. Gross margin and 01/28E 3.75 3.68

EBITDA margins are now at or near best-in-class levels (~63% GM%, ~36%+ 01/29E 4.25 4.18

EBITDA). What are the structural vs. cyclical drivers behind this and what gives

GRGD confidence margins can continue to expand rather than normalize? Can Mauricio Serna, CFA

GRGD quantify the potential margin impact if oil/freight pressures persist, and Analyst

mauricio.serna@ubs.com

how much flexibility GRGD has to offset through pricing or sourcing?

+1-212-713 9028

5. North America store openings beyond FY26. With 19 to 21 store openings for Jay Sole

FY26, is GRGD having any difficulty finding new retail centers for the FY27 Analyst

pipeline? What is GRGD seeing in terms of competitive bidding for Tier 1 jay.sole@ubs.com

"investment-grade" assets? How feasible is for its pipeline to accelerate in future +1-212-713 3559

years? How is GRGD ensuring incremental stores don’t dilute returns, particularly Natalie Koltermann

as it moves deeper into existing markets? Associate Analyst

natalie.koltermann@ubs.com

Please find questions 6-10 inside. +1-212-713 4229

Valuation: Our PT is C$125 PT and our rating is Buy: (link)

Highlights (C$m) 01/24 01/25 01/26 01/27E 01/28E 01/29E 01/30E 01/31E

Revenues 801 959 1,310 1,638 1,856 2,064 2,255 2,461

EBIT (UBS) 148 227 384 521 598 660 727 799