April 3 (Reuters) - Dollarama ( DLMAF ) beat

fourth-quarter sales and profit estimates on Thursday, helped by

cost-conscious consumers flocking to its stores during the

holiday season to buy affordable items such as groceries and

toys.

Consumers shopping on a budget have increasingly switched to

lower-priced alternatives across categories ranging from pantry

staples to cleaning supplies, boosting demand at dollar stores

such as Dollarama ( DLMAF ).

Retailers in Canada also gained from offering discounts

during the holiday quarter on categories such as decorations,

which helped draw more shoppers to their stores.

Dollarama ( DLMAF ) posted net sales of C$1.88 billion ($1.33 billion)

for the quarter, compared with analysts' estimate of C$1.87

billion according to data compiled by LSEG.

It posted net earnings of C$1.40 per share in the three

months ended February 2, compared with C$1.15 a year earlier.

Analysts' on average expected profit of C$1.31 per share.

The Montreal, Quebec-based company's quarterly gross margin

was 46.8% of sales, from 46.3% a year earlier.

Easing costs of logistics helped the company in combating

operations costs, in turn improving its margins.

U.S. retailers such as Walmart ( WMT ), Target ( TGT ) and

Dollar General ( DG ) provided dour forecasts as they face the

brunt of President Donald Trump's import tariffs.

While Canadians opt for more locally produced items in the

wake of "Buy Canadian" movement in response to Trump's tariffs,

retailers in the country are reshuffling their shelves and

adding lesser products from U.S. companies.

Dollarama ( DLMAF ), which last month bought Australia's Reject Shop,

expects annual sales to grow in the range of 3% to 4%, the

midpoint of which is slightly below analysts' estimates of 3.7%.

The company said it believes consumers will continue to

respond positively to its affordable products, convenient store

network and strong value across consumables, seasonal items and

general merchandise.

($1 = 1.4128 Canadian dollars)