Reitmans (Canada) Limited Reports First Quarter Financial Results

Net revenues from retail stores up 2.9% on lower store count

MONTREAL, June 16, 2026 /CNW/ - Reitmans (Canada) Limited ("RCL" or the "Company") (TSXV: RET) (TSXV: RET-A), one of Canada's leading specialty apparel retailers, today reported its financial results for the first quarter ended May 2, 2026. Unless otherwise indicated, all comparisons are to the first quarter ended May 3, 2025.  All dollar amounts are in Canadian currency.

Highlights

• Net revenues grew 0.8% to $160.1 million for the quarter.
• Comparable sales¹, which include e-commerce net revenues, were up 0.3%.
• Gross profit % was stable for the quarter at 55.7%.
• Selling General & Administrative ("SG&A") expenses decreased 2.2%
• Adjusted EBITDA¹ improved by $5.2 million to $(5.4) million for the quarter.

"RCL delivered an improved first quarter compared to last year, with solid progress shown across the business despite a challenging economic environment," said Andrea Limbardi, President and CEO of RCL. "Net revenues from our retail stores increased 2.9% as Canadians continued returning to stores, particularly in shopping malls. Our investments in the store fleet are beginning to pay off, with non‑comparable locations contributing more strongly to revenue growth. We also grew net revenues while operating with lower inventory during the quarter. Meanwhile, we lowered our SG&A expenses, largely through the workforce reduction as part of our strategic transformation."

"As part of ongoing efforts to optimize our store network, Reitmans unveiled a successful new concept flagship store at Carrefour Laval, just outside Montréal, Québec. After quarter-end, RW&CO completed the transformation of its Toronto Eaton Centre store to their new concept introduced last fall, and the store has exceeded expectations since reopening on May 29^th, 2026."

"The difficult economic reality is impacting everyday Canadians – we hear it from our customers every day. The rise in fuel costs and the related effects are significant. We remain committed to being the best choice for Canadians for great fashion at exceptional value. We are confident in our strategy, our brands, and the work underway to build a stronger, more resilient RCL."

Selected Financial Information

(in millions of dollars, except for gross profit % and earnings per share) (unaudited)	First quarter
	2027	2026	Change
Net revenues	$160.1	$158.9	0.8 %
Gross profit	$89.1	$88.5	0.7 %
Gross profit %	55.7 %	55.7 %	-
Selling, general and    administrative expenses	$96.9	$99.1	(2.2 %)
Strategic transformation    expenses	$0.2	-	n/a
Net loss	($6.3)	($10.0)	37.0 %
Adjusted EBITDA^1	($5.4)	($10.6)	49.1 %
Loss per share:
Basic	($0.13)	($0.20)	35.0 %
Diluted	($0.13)	($0.20)	35.0 %

On May 2, 2026, RCL had working capital¹ of $126.0 million, including cash of $101.9 million compared to working capital of $137.2 million, including cash of $151.0 million as at January 31, 2026, and working capital of $134.8 million, including cash of $85.4 million as at May 3, 2025. At the end of the first quarter, RCL had no significant long-term debt other than lease liabilities, and no amounts were drawn under the Company's bank credit facilities.

¹ This is a Non-GAAP Financial Measure. See "Non-GAAP Financial Measures & Supplementary Financial Measures" for reconciliations of these measures.

First Quarter Overview

Net revenues increased 0.8%, to $160.1 million, with seven fewer stores year-over-year at quarter end. Net revenues from retail stores increased by 2.9%, largely driven by stores not included in comparable sales, benefiting from the investments made in new stores. Comparable sales¹ were up 0.3% compared to last year mainly from higher sales dollars per transaction.

Gross profit increased by $0.6 million to $89.1 million, as compared with $88.5 million for the first quarter last year. Gross profit as a percentage of net revenues was stable at 55.7%.

Adjusted EBITDA¹ was ($5.4) million, a 49.1% improvement as compared to the first quarter of the prior year, largely due to the decrease in SG&A expenses. 

The Company's complete financial statements including notes, and the Company's MD&A for the first quarter of fiscal 2027 are available online at www.sedarplus.ca.

¹ This is a Non-GAAP Financial Measure. See "Non-GAAP Financial Measures & Supplementary Financial Measures" for reconciliations of these measures.

Normal Course Issuer Bid ("NCIB")

During the first quarter of 2027, under the NCIB, the Company purchased for cancellation 235,600 Class A non-voting Shares for an aggregate cash consideration of $0.5 million. From the inception of the NCIB, on August 5, 2024, to May 2, 2026, the Company has purchased for cancellation a total of 745,200 Shares.

The Company intends to renew the NCIB, which expires in August 2026, through the facilities of the TSX Venture Exchange to purchase Non-Voting Shares. The extent to which the Company repurchases its shares and the timing of such purchases will depend upon the market conditions and other corporate considerations. The NCIB is subject to regulatory approval.

Conference Call

The Company will host a conference call on June 17, 2026, at 8:30 am Eastern Time to discuss its first quarter financial results. Interested parties may join the conference call by dialing 1-888-699-1199 or 416-945-7677 approximately 15 minutes prior to the call to secure a line.

A live audio webcast of the call will be available at https://www.reitmanscanadalimited.com/pages/events-presentations and will be available for replay at this website for 12 months.

About Reitmans (Canada) Limited

Reitmans (Canada) Limited is one of Canada's leading specialty apparel retailers for women and men, with retail outlets throughout the country. The Company operates 387 stores under three distinct banners consisting of 217 Reitmans, 85 PENN., and 85 RW&CO.

For more information, visit www.reitmanscanadalimited.com.

For further information, please contact:

NON-GAAP Financial Measures & Supplementary Financial Measures

This press release makes reference to certain non-GAAP measures. These measures are not recognized measures under International Financial Reporting Standards ("IFRS") and do not have a standardized meaning prescribed by IFRS. They are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS measures by providing further understanding of the Company's results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for the Company's analysis of its financial information reported under IFRS.

NON-GAAP Financial Measures

This press release discusses the following non-GAAP financial measures: adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"), and working capital.  This press release indicates that Adjusted EBITDA as a percentage of net revenues is considered a non-GAAP financial ratio. The intent of presenting Adjusted EBITDA is to provide additional useful information to investors and analysts.

Adjusted EBITDA is currently defined as net (loss) earnings before depreciation, amortization, net impairment losses of non-financial assets, interest expense, interest income, income tax (recovery), and adjusted for the impact of certain items, such as strategic transformation expenses, pension windup-related costs, and a deduction of interest expense and depreciation relating to leases accounted for under IFRS 16, Leases. The Company began excluding strategic transformation expenses from Adjusted EBITDA in the third quarter of 2026.  Management believes that Adjusted EBITDA is an important indicator of the Company's ability to generate liquidity through operating cash flow to fund working capital needs and fund capital expenditures and uses this metric for this purpose. Management believes that Adjusted EBITDA as a percentage of net revenues indicates how much liquidity is generated for each dollar of net revenues. The exclusion of interest income and expenses, other than interest expense related to lease liabilities as explained hereafter, eliminates the impact on earnings derived from non-operational activities. The exclusion of depreciation, amortization and net impairment losses, other than depreciation related to right-of-use assets as explained hereafter, eliminates the non-cash impact and the exclusion of strategic transformation expenses and pension windup-related costs adjust the results to better reflect the on-going business. Strategic transformation expenses which consist of employee termination benefits and consulting fees, are adjusted as they represent specific expenses related to restructuring efforts to evolve the Company's operating structure, as part of the implementation of the Company's five-year strategic plan. These expenses are limited to the project's timeframe and occur before any ongoing benefits are achieved. Adjusting such expenses can also be useful in assessing financial performance across periods on a comparable basis. Under IFRS 16, Leases, the characteristics of some leases result in lease payments being recognized in net earnings in the period in which the performance or use occurs while other leases are recorded as right-of-use assets with a corresponding lease liability recognized, which results in depreciation of those assets and interest expense from those liabilities. Management is presenting its Adjusted EBITDA to reflect the payments of its store and equipment lease obligations on a consistent basis. As such, the initial addback of depreciation of right-of-use assets and interest on lease obligations are removed from the calculation of Adjusted EBITDA, as this better reflects the operational cash flow impact of its leases.

Working capital is defined as current assets less current liabilities.  Management believes that working capital provides information that is helpful to understand the financial condition of the Company. Due to the seasonality of the Company's business, it is more relevant to compare the working capital position at the same point in time.  

Reconciliation of NON-GAAP Financial Measures

The tables below provide a reconciliation of net loss to Adjusted EBITDA and the composition of working capital:

	For the first quarter of
	2027	2026
Net loss	$   (6.3)	$   (10.0)
Depreciation, amortization and net impairment losses     on property and equipment, and intangible assets	4.6	3.9
Depreciation on right-of-use assets	10.4	10.2
Interest expense on lease liabilities	2.5	2.5
Interest income	(0.9)	(1.0)
Income tax recovery	(3.0)	(3.8)
Strategic transformation expenses	0.2	-
Pension windup-related costs	-	0.3
Rent impact from IFRS 16, Leases^1	(12.9)	(12.7)
Adjusted EBITDA	$   (5.4)	$   (10.6)
Adjusted EBITDA as % of net revenues	(3.4 %)	(6.7 %)

^1 Rent Impact from IFRS 16, Leases is comprised as follows:
	For the first quarter of
	2027	2026
Depreciation on right-of-use assets	$   10.4	$   10.2
Interest expense on lease liabilities	2.5	2.5
Rent impact from IFRS 16, Leases	$   12.9	$   12.7

		As at May 2, 2026		As at May 3, 2025		As at January 31, 2026
Current assets		$   252.3		$   249.1		$   280.2
Current liabilities		126.3		114.3		143.0
Working capital		$   126.0		$   134.8		$   137.2

Supplementary Financial Measures

The Company uses a key performance indicator ("KPI"), comparable sales, to assess store performance and sales growth. The Company engages in an omnichannel approach in connecting with its customers by appealing to their shopping habits through either online or store channels.  This approach allows customers to shop online for home delivery or to pick up in store, purchase in any of our store locations or ship to home from another store when the products are unavailable in a particular store.  Due to customer cross-channel behavior, the Company reports a single comparable sales metric, inclusive of store and e-commerce channels. Comparable sales are defined as net sales generated by stores that have been continuously open during both of the periods being compared and include e-commerce net sales. The comparable sales metric compares the same calendar days for each period. Although this KPI is expressed as a ratio, it is a supplementary financial measure that does not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures used by other companies. Management uses comparable sales in evaluating the performance of stores and online net sales and considers it useful in helping to determine what portion of new net sales has come from sales growth and what portion can be attributed to the opening of new stores. Comparable sales is a measure widely used amongst retailers and is considered useful information for both investors and analysts. Comparable sales should not be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS.

Forward-Looking Statements

All of the statements contained herein, other than statements of fact that are independently verifiable at the date hereof, are forward-looking statements. Such statements, based as they are on the current expectations of management, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond the Company's control and are based on several assumptions which give rise to the possibility that actual results could differ materially from the Company's expectations expressed in or implied by such forward-looking statements and that the objectives, plans, strategic priorities and business outlook may not be achieved.  Consequently, the Company cannot guarantee that any forward-looking statement will materialize, or if any of them do, what benefits the Company will derive from them. Forward-looking statements are provided in this press release for the purpose of allowing investors and others to get a better understanding of the Company's operating environment and management's expectations and plans as of the date of this press release. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose. Forward-looking statements are based upon the Company's current estimates, beliefs and assumptions, which are based on management's perception of historical trends, current conditions and currently expected future developments, as well as other factors it believes, are appropriate in the circumstances.

This press release contains forward-looking statements about the Company's objectives, plans, goals, expectations, aspirations, strategies, financial condition, results of operations, cash flows, performance, prospects, opportunities, and legal and regulatory matters. Specific forward-looking statements in this press release include, but are not limited to, statements with respect to the Company's belief in its strategies and its brands and their capacity to generate long-term profitable growth plans to meet certain financial objectives, future liquidity, planned capital expenditures, status and impact of systems implementation, the ability of the Company to successfully implement its strategic initiatives and cost reduction and productivity improvement initiatives as well as the impact of such initiatives.  These specific forward-looking statements are contained throughout this press release and the Company's Management Discussion & Analysis ("MD&A") including those listed in the "Risk and Uncertainties" section of the MD&A. Forward-looking statements are typically identified by words such as "expect", "anticipate", "believe", "foresee", "could", "estimate", "goal", "intend", "plan", "seek", "strive", "will", "may" and "should" and similar expressions, as they relate to the Company and its management.  Forward-looking statements are based on information currently available to management and on estimates and assumptions, including assumptions about future economic conditions and courses of action.  Examples of material estimates and assumptions and beliefs made by management in preparing such forward looking statements: management's belief in its strategies and its brands and their capacity to generate long-term profitable growth, significant sales growth in RW&CO both in stores and online, increased market share for both Reitmans and PENN., stability in the current market environment, changes in laws, rules, regulations and global standards, the Company's competitive position in its industry, the Company's ability to keep pace with changing consumer preferences, the absence of public health related restrictions impacting client shopping patterns or incremental direct costs related to health and safety measures, the Company's ability to execute on its capital expenditure plan, including at its distribution centre in Montreal, and the Company's ability to retain and recruit exceptional talent.

Numerous risks and uncertainties could cause the Company's actual results to differ materially from those expressed, implied or projected in the forward-looking statements. Please refer to the "Forward-Looking Statements" section of the Company's MD&A for the first quarter of fiscal 2027.

Risk and uncertainties not presently known to the Company or that the Company presently believes are not material could also cause actual results or events to differ materially from those expressed in its forward-looking statements. Additional risks and uncertainties are discussed in the Company's materials filed with the Canadian securities regulatory authorities from time to time. See section entitled Risk and Uncertainties of the Company's MD&A for the first quarter of fiscal 2027.  The reader should not place undue reliance on any forward-looking statements included herein. These statements speak only as of the date made and the Company is under no obligation and disavows any intention to update or revise such statements as a result of any event, circumstances or otherwise, except to the extent required under applicable securities law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Reitmans (Canada) Ltd

For further information, please contact: Alexandra Cohen, VP, Corporate Communications, Reitmans (Canada) Limited, Telephone: [phone], Email: [email protected]; Caroline Goulian, EVP & Chief Financial Officer, Reitmans (Canada) Limited, Telephone: [phone], Email: [email protected]