Groupe Dynamite Inc.‘s CEO says tariffs aren’t blunting the appeal of a new cute top.
While Andrew Lutfy has seen some customers forgoing big-ticket purchases like boats, RVs and basement renovations as countries levy increasing duties, he says that pullback isn’t carrying over to its Dynamite or Garage stores.
The women’s fashion retailer is instead seeing shoppers looking for “some instant gratification” amid all the “heaviness out there.”
“For the price of a martini in a nice restaurant, you could buy a cute top and feel great and wear it over and over again, so we’re seeing a customer that’s looking for moments of joy and happiness and we are an affordable indulgence,” Lutfy told analysts on a conference call on Tuesday.
He said he expects that trend to continue, especially if interest rates, debt levels and prices remain high because of the tariff war U.S. President Donald Trump has sparked with Canada and several countries known for manufacturing clothing.
Groupe Dynamite shares were up nearly 15 per cent or $2.40 at $18.91 on the Toronto Stock Exchange on Tuesday after it reported its latest financial results and raised its guidance for comparable store sales for the year.
The company said it earned a first-quarter profit of $27.3 million or 24 cents per diluted share, up from $23.9 million or 22 cents per diluted share a year ago.
On an adjusted basis, Groupe Dynamite earned 25 cents per diluted share in its quarter ended May 3, up from an adjusted profit of 23 cents per diluted share a year ago.
Revenue totalled $226.7 million, up from $188.9 million, while comparable store sales rose 13 per cent.
In its outlook, Groupe Dynamite said it now expects comparable store sales growth for its full year between 7.5 per cent and nine per cent, up from earlier guidance for between five per cent and 6.5 per cent.
RBC Capital Markets analyst Irene Nattel pointed out that such numbers were ahead of forecasts, meaning the business was “starting the year with a bang.”
The results reflect the work Groupe Dynamite has done to shift its supply chain away from China — one of Trump’s top tariff targets — and set the stage for a further brand expansion.
The company, which is celebrating its 50th anniversary, will expand into the United Kingdom next year and is weeks away from opening a new U.S. distribution centre.
The facility will cut shipping times, improve service levels, reduce costs and help the business better manage and replenish its inventory, president and chief operating officer Stacie Beaver said.
“More importantly, it means when our customer shops with us, she gets exactly what she wants when she wants it,” she said. “That’s the experience our teams deliver every day and it’s a promise we’re excited to bring to the U.K. when we open our first store there next year.”
Back home, she said the company has been renovating its Garage stores to introduce “a cleaner, more elevated” store layout.
The latest to get a revamp are Square One and Conestoga Mall in Ontario.
Their renovations and others are boosting worker satisfaction, Beaver said.
“Turnover is down, engagement is up, and it shows,” she said. “Our associates are more confident, more connected to the product, and better equipped to serve our customers.”
This report by The Canadian Press was first published June 17, 2025.
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