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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549



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FORM 10-Q



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|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended October 31, 2006

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from  to

333-134550

(Commission File Number)

Dollarama Group L.P.

(Exact name of registrant as specified in its charter)



|                                               |  |                                  
|---------------------------------------------- |  | ---------------------------------
|Québec, Canada                                 |  | Not Applicable                   
|(State or other jurisdiction of incorporation) |  | (IRS Employer Identification No.)
|                                               | 
|5430 Ferrier, Montréal                         |  | H4P 1M2                          
|(Address of principal executive offices)       |  | (Postal Code)                    

(514) 737-1006

(Registrants telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)



---

Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes ̈No  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated
filer, per Rule 12b-2 of the Exchange Act.

Large accelerated filer ̈Accelerated filer ̈Non-accelerated filer  x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes ̈No  x



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##### Table of Contents

TABLE OF CONTENTS



|                              |  |                                                                                       |  |     
|----------------------------- |  | ------------------------------------------------------------------------------------- |  | ----
|                              |  |                                                                                       |  | Page
|PART I. FINANCIAL INFORMATION |  |                                                                                      
|                              |  |                                                                                      
|Item 1.                       |  | Consolidated Financial Statements                                                     |  | 3   
|                              |  |                                                                                      
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition and Results of Operations |  | 23  
|                              |  |                                                                                      
|Item 3.                       |  | Quantitative and Qualitative Disclosures about Market Risk                            |  | 34  
|                              |  |                                                                                      
|Item 4.                       |  | Controls and Procedures                                                               |  | 35  
|                              | 
|PART II. OTHER INFORMATION    |  |                                                                                      
|                              |  |                                                                                      
|Item 1.                       |  | Legal Proceedings                                                                     |  | 36  
|                              |  |                                                                                      
|Item 1A.                      |  | Risk Factors                                                                          |  | 36  
|                              |  |                                                                                      
|Item 6.                       |  | Exhibits                                                                              |  | 36  
|                              |  |                                                                                      
|                              |  | Signatures                                                                            |  | 37  



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

PART I  FINANCIAL INFORMATION



|ITEM 1. | CONSOLIDATED FINANCIAL STATEMENTS
|------- | ---------------------------------

Consolidated Balance Sheets

(Expressed in Thousands of Canadian Dollars)

(Unaudited)



|                                        |  |                 |           |   |                 |   |           |  
|--------------------------------------- |  | --------------- | --------- | - | --------------- | - | --------- | -
|                                        |  | October 31,2006 |           |   | January 31,2006 |  
|Assets                                  |  |                 |           |   |                 |   |           |  
|Current                                 |  |                 |           |   |                 |   |           |  
|Cash and cash equivalents               |  | $               | 26,867    |   |                 | $ | 30,883    |  
|Receivables                             |  |                 | 6,720     |   |                 |   | 3,380     |  
|Income taxes refundable                 |  |                 |          |   |                 |   | 139       |  
|Deposits and prepaid expenses           |  |                 | 5,378     |   |                 |   | 3,302     |  
|Merchandise inventories                 |  |                 | 164,552   |   |                 |   | 154,047   |  
|                                        |  |                 |           |   |                 |   |           |  
|                                        |  |                 | 203,517   |   |                 |   | 191,751   |  
|Property and Equipment                  |  |                 | 78,687    |   |                 |   | 54,571    |  
|Goodwill                                |  |                 | 727,782   |   |                 |   | 727,782   |  
|Other Intangibles                       |  |                 | 121,430   |   |                 |   | 124,750   |  
|                                        |  |                 |           |   |                 |   |           |  
|Total Assets                            |  | $               | 1,131,416 |   |                 | $ | 1,098,854 |  
|                                        |  |                 |           |   |                 |   |           |  
|Liabilities                             |  |                 |           |   |                 |   |           |  
|Current                                 |  |                 |           |   |                 |   |           |  
|Accounts payable                        |  | $               | 24,115    |   |                 | $ | 12,278    |  
|Accrued expenses and other              |  |                 | 34,160    |   |                 |   | 31,612    |  
|Income taxes payable                    |  |                 | 265       |   |                 |   |          |  
|Derivative financial instruments        |  |                 | 41,183    |   |                 |   | 34,531    |  
|Current portion of long-term debt       |  |                 | 2,734     |   |                 |   | 14,805    |  
|                                        |  |                 |           |   |                 |   |           |  
|                                        |  |                 | 102,457   |   |                 |   | 93,226    |  
|Long-Term Debt(note 2)                  |  |                 | 561,638   |   |                 |   | 581,637   |  
|Unfavorable Lease Rights and Other      |  |                 | 24,392    |   |                 |   | 22,171    |  
|                                        |  |                 |           |   |                 |   |           |  
|Total Liabilities                       |  |                 | 688,487   |   |                 |   | 697,034   |  
|                                        |  |                 |           |   |                 |   |           |  
|Commitments and Contingencies(note 3)   |  |                 |           |   |                 |   |           |  
|Partners Capital                       |  |                 |           |   |                 |   |           |  
|General Partner                         |  |                 | 374       |   |                 |   | 374       |  
|Limited Partner                         |  |                 | 390,660   |   |                 |   | 394,876   |  
|Contributed Surplus                     |  |                 | 1,263     |   |                 |   | 800       |  
|Retained Earnings                       |  |                 | 54,555    |   |                 |   | 11,800    |  
|Accumulated Other Comprehensive Loss    |  |                 | (3,923    | ) |                 |   | (6,030    | )
|                                        |  |                 |           |   |                 |   |           |  
|Total Partners Capital                 |  |                 | 442,929   |   |                 |   | 401,820   |  
|                                        |  |                 |           |   |                 |   |           |  
|Total Liabilities and Partners Capital |  | $               | 1,131,416 |   |                 | $ | 1,098,854 |  
|                                        |  |                 |           |   |                 |   |           |  

See accompanying notes



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Consolidated Statement of Partners Capital and other Comprehensive Income

(Expressed in Thousands of
Canadian Dollars)

(Unaudited)

For the Nine
Month Period Ended October 31, 2006



|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|------------------------------------------------------------- |  | --------------------- | --- | --------------------- | - | ------- | ------------------ |  | ---------------- | ----- | ---------------------------------------- | - | ------ | ----- | - | ------ | - |  | - | ------- | -
|                                                              |  | GeneralPartnerCapital |     | LimitedPartnerCapital |   |         | ContributedSurplus |  | RetainedEarnings |       | AccumulatedOtherComprehensiveGain (Loss) |   |        | Total |  
|Partners Capital - Beginning of Period                       |  | $                     | 374 |                       | $ | 394,876 |                    |  | $                | 800   |                                          | $ | 11,800 |       | $ | (6,030 | ) |  | $ | 401,820 |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|Comprehensive income:                                         |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|Net earnings                                                  |  |                       |    |                       |   |        |                    |  |                  |      |                                          |   | 42,755 |       |   |       |   |  |   | 42,755  |  
|Change in unrealized gain on derivative financial instruments |  |                       |    |                       |   |        |                    |  |                  |      |                                          |   |       |       |   | 2,107  |   |  |   | 2,107   |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|Total Comprehensive Income                                    |  |                       |    |                       |   |        |                    |  |                  |      |                                          |   | 42,755 |       |   | 2,107  |   |  |   | 44,862  |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|Stock-based compensation                                      |  |                       |    |                       |   |        |                    |  |                  | 463   |                                          |   |       |       |   |       |   |  |   | 463     |  
|Capital distributions                                         |  |                       |    |                       |   | (4,216  | )                  |  |                  |      |                                          |   |       |       |   |       |   |  |   | (4,216  | )
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|                                                              |  |                       |    |                       |   | (4,216  | )                  |  |                  | 463   |                                          |   |       |       |   |       |   |  |   | (3,753  | )
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  
|Partners Capital - End of Period                             |  | $                     | 374 |                       | $ | 390,660 |                    |  | $                | 1,263 |                                          | $ | 54,555 |       | $ | (3,923 | ) |  | $ | 442,929 |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |                                          |   |        |       |   |        |   |  |   |         |  

For the Nine Month Period Ended October 31, 2005



|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|------------------------------------------------------------- |  | --------------------- | --- | --------------------- | - | ------- | ------------------ |  | ---------------- | ----- |  | ---------------------------------------- | ------- | - | ----- | - | ------ | - |  | - | ------- | -
|                                                              |  | GeneralPartnerCapital |     | LimitedPartnerCapital |   |         | ContributedSurplus |  | RetainedEarnings |       |  | AccumulatedOtherComprehensiveGain (Loss) |         |   | Total |  
|Partners Capital - Beginning of Period                       |  | $                     | 374 |                       | $ | 454,484 |                    |  | $                | 202   |  | $                                        | (23,206 | ) |       | $ | 1,355  |   |  | $ | 433,209 |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|Comprehensive income:                                         |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|Net earnings                                                  |  |                       |    |                       |   |        |                    |  |                  |      |  |                                          | 10,203  |   |       |   |       |   |  |   | 10,203  |  
|Change in unrealized loss on derivative financial instruments |  |                       |    |                       |   |        |                    |  |                  |      |  |                                          |        |   |       |   | (7,606 | ) |  |   | (7,606  | )
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|Total Comprehensive Income                                    |  |                       |    |                       |   |        |                    |  |                  |      |  |                                          | 10,203  |   |       |   | (7,606 | ) |  |   | 2,597   |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|Stock-based compensation                                      |  |                       |    |                       |   |        |                    |  |                  | 837   |  |                                          |        |   |       |   |       |   |  |   | 837     |  
|Capital distributions                                         |  |                       |    |                       |   | (58,349 | )                  |  |                  |      |  |                                          |        |   |       |   |       |   |  |   | (58,349 | )
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|                                                              |  |                       |    |                       |   | (58,349 | )                  |  |                  | 837   |  |                                          |        |   |       |   |       |   |  |   | (57,512 | )
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  
|Partners Capital - End of Period                             |  | $                     | 374 |                       | $ | 396,135 |                    |  | $                | 1,039 |  | $                                        | (13,003 | ) |       | $ | (6,251 | ) |  | $ | 378,294 |  
|                                                              |  |                       |     |                       |   |         |                    |  |                  |       |  |                                          |         |   |       |   |        |   |  |   |         |  

See accompanying notes



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Consolidated Statements of Operations

For the Periods Ended October 31,

(Expressed in Thousands of Canadian Dollars)

(Unaudited)



|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|---------------------------------------------------------------------------------------------------- |  | ----------------- | ------- | ------------------ | ---- | - | ------- |  | - | ------- | - |  | - | -------
|                                                                                                     |  | Nine Months Ended |         | Three Months Ended
|                                                                                                     |  | 2006              |         |                    | 2005 |   | 2006    |  |   | 2005   
|Sales                                                                                                |  | $                 | 611,560 |                    |      | $ | 517,496 |  | $ | 218,477 |   |  | $ | 186,542
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|Cost of Sales and Expenses                                                                           |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|Cost of sales                                                                                        |  |                   | 410,533 |                    |      |   | 357,771 |  |   | 146,452 |   |  |   | 124,047
|General, administrative and store operating expenses                                                 |  |                   | 107,382 |                    |      |   | 88,878  |  |   | 37,405  |   |  |   | 30,871 
|Amortization                                                                                         |  |                   | 11,918  |                    |      |   | 9,688   |  |   | 4,464   |   |  |   | 3,287  
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|                                                                                                     |  |                   | 529,833 |                    |      |   | 456,337 |  |   | 188,321 |   |  |   | 158,205
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|Operating Income                                                                                     |  |                   | 81,727  |                    |      |   | 61,159  |  |   | 30,156  |   |  |   | 28,337 
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|Amortization of deferred financing costs                                                             |  |                   | 3,050   |                    |      |   | 6,494   |  |   | 1,015   |   |  |   | 1,011  
|Write-off of deferred financing costs                                                                |  |                   |        |                    |      |   | 6,606   |  |   |        |   |  |   | 6,606  
|Interest expense                                                                                     |  |                   | 35,337  |                    |      |   | 34,119  |  |   | 12,001  |   |  |   | 11,671 
|Foreign exchange loss on long-term debt and change in fair value of derivative financial instruments |  |                   | (679    | )                  |      |   | 2,477   |  |   | (693    | ) |  |   | 2,241  
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|                                                                                                     |  |                   | 37,708  |                    |      |   | 49,696  |  |   | 12,323  |   |  |   | 21,529 
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|Earnings Before Income Taxes                                                                         |  |                   | 44,019  |                    |      |   | 11,463  |  |   | 17,833  |   |  |   | 6,808  
|Income taxes                                                                                         |  |                   | 1,264   |                    |      |   | 1,260   |  |   | 421     |   |  |   | 453    
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        
|Net Earnings                                                                                         |  | $                 | 42,755  |                    |      | $ | 10,203  |  | $ | 17,412  |   |  | $ | 6,355  
|                                                                                                     |  |                   |         |                    |      |   |         |  |   |         |   |  |   |        

See accompanying notes



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Consolidated Statements of Cash Flows

For the Periods Ended October 31,

(Expressed in Thousands of Canadian Dollars)

(Unaudited)



|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|------------------------------------------------------------------ |  | ----------------- | ------- | - | ------------------ | - | -------- | ---- |  | - | ------- | - |  | - | -------- | -
|                                                                   |  | Nine Months Ended |         |   | Three Months Ended |  
|                                                                   |  | 2006              |         |   | 2005               |   |          | 2006 |  |   | 2005    |  
|Cash Provided (Used) -                                             |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Operating Activities                                               |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Net earnings                                                       |  | $                 | 42,755  |   |                    | $ | 10,203   |      |  | $ | 17,412  |   |  | $ | 6,355    |  
|Amortization of property and equipment                             |  |                   | 8,277   |   |                    |   | 6,138    |      |  |   | 3,022   |   |  |   | 2,114    |  
|Amortization of intangibles                                        |  |                   | 3,641   |   |                    |   | 3,550    |      |  |   | 1,442   |   |  |   | 1,173    |  
|Loss on disposal of property and equipment                         |  |                   | 41      |   |                    |   |         |      |  |   | 21      |   |  |   |         |  
|Change in fair value of non-hedging derivatives                    |  |                   | 4,471   |   |                    |   | 19,081   |      |  |   | 1,851   |   |  |   | 14,006   |  
|Change in fair value of hedging derivatives                        |  |                   | 4,287   |   |                    |   |         |      |  |   | 2,880   |   |  |   |         |  
|Amortization of deferred financing costs                           |  |                   | 3,050   |   |                    |   | 6,494    |      |  |   | 1,015   |   |  |   | 1,011    |  
|Write-off of deferred financing costs                              |  |                   |        |   |                    |   | 6,606    |      |  |   |        |   |  |   | 6,606    |  
|Foreign exchange gain on long-term debt                            |  |                   | (3,878  | ) |                    |   | (16,157  | )    |  |   | (2,064  | ) |  |   | (12,733  | )
|Amortization of unfavorable lease rights                           |  |                   | (2,669  | ) |                    |   | (2,620   | )    |  |   | (1,049  | ) |  |   | (837     | )
|Deferred lease inducements                                         |  |                   | 2,221   |   |                    |   | 3,342    |      |  |   | 664     |   |  |   | 899      |  
|Amortization of deferred tenant allowances                         |  |                   | (387    | ) |                    |   |         |      |  |   | (170    | ) |  |   |         |  
|Amortization of deferred leasing costs                             |  |                   | 102     |   |                    |   |         |      |  |   | 38      |   |  |   |         |  
|Stock-based compensation                                           |  |                   | 463     |   |                    |   | 837      |      |  |   | 155     |   |  |   | 349      |  
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|                                                                   |  |                   | 62,374  |   |                    |   | 37,474   |      |  |   | 25,217  |   |  |   | 18,943   |  
|Changes in non-cash operating elements of working capital (note 5) |  |                   | (1,132  | ) |                    |   | (37,400  | )    |  |   | (21,131 | ) |  |   | (3,291   | )
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Net cash provided by operating activities                          |  |                   | 61,242  |   |                    |   | 74       |      |  |   | 4,086   |   |  |   | 15,652   |  
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Investing Activities                                               |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Purchase of property and equipment                                 |  |                   | (32,588 | ) |                    |   | (15,222  | )    |  |   | (12,596 | ) |  |   | (6,477   | )
|Proceeds on disposal of property and equipment                     |  |                   | 154     |   |                    |   | 182      |      |  |   | 51      |   |  |   | 70       |  
|Deferred tenant allowances                                         |  |                   | 3,056   |   |                    |   |         |      |  |   | 876     |   |  |   |         |  
|Deferred leasing costs                                             |  |                   | (423    | ) |                    |   | (1,462   | )    |  |   | (40     | ) |  |   | (1,462   | )
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Net cash used in investing activities                              |  |                   | (29,801 | ) |                    |   | (16,502  | )    |  |   | (11,709 | ) |  |   | (7,869   | )
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Financing Activities                                               |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Due to company controlled by a minority shareholder                |  |                   |        |   |                    |   | (2,468   | )    |  |   |        |   |  |   | (2,425   | )
|Deferred financing costs                                           |  |                   |        |   |                    |   | (9,822   | )    |  |   |        |   |  |   | (7,973   | )
|Proceeds from long-term debt                                       |  |                   |        |   |                    |   | 293,533  |      |  |   |        |   |  |   | 293,533  |  
|Repayment of long-term debt                                        |  |                   | (28,061 | ) |                    |   | (246,477 | )    |  |   | (20,684 | ) |  |   | (242,227 | )
|Capital distributions                                              |  |                   | (4,216  | ) |                    |   | (58,349  | )    |  |   | (1,335  | ) |  |   | (54,976  | )
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Net cash used in financing activities                              |  |                   | (32,277 | ) |                    |   | (23,583  | )    |  |   | (22,019 | ) |  |   | (14,068  | )
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Foreign currency translation adjustment                            |  | $                 | (3,180  | ) |                    | $ |         |      |  | $ | (1,700  | ) |  | $ |         |  
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Decrease in Cash and Cash Equivalents                              |  |                   | (4,016  | ) |                    |   | (40,011  | )    |  |   | (31,342 | ) |  |   | (6,285   | )
|Cash and Cash Equivalents                                          |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Beginning of Period                                                |  |                   | 30,883  |   |                    |   | 44,585   |      |  |   | 58,209  |   |  |   | 10,859   |  
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|End of Period                                                      |  | $                 | 26,867  |   |                    | $ | 4,574    |      |  | $ | 26,867  |   |  | $ | 4,574    |  
|                                                                   |  |                   |         |   |                    |   |          |      |  |   |         |   |  |   |          |  

See accompanying notes



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|1. | Basis of Presentation and Nature of Business
|-- | --------------------------------------------

Dollarama Group L.P.
- Groupe Dollarama S.E.C. was formed on November 11, 2004 under the laws of the province of Quebec for the purpose of the acquisition of the DOLLARAMA retail stores. The general partner is Dollarama Group GP Inc.

The consolidated financial statements reflect the financial position, results of operations and cash flows of the business of Dollarama L.P. - Dollarama S.E.C.,
Dollarama Corporation, Aris Import Inc. - Les Importations Aris Inc., Dollarama Group L.P. - Groupe Dollarama S.E.C. and Dollarama GP Inc. (collectively the Partnership). On consolidation all significant inter-entity transactions and
balances have been eliminated.

The consolidated financial statements include all entities controlled by a majority voting interest as well as variable
interest entities for which Dollarama Group L.P. is the primary beneficiary. No such variable interest entities were identified for the periods presented.

The Partnership operates discount variety retail stores in Canada under the name DOLLARAMA that sell substantially all items for $1.00 or less. As at October 31, 2006, the retail operations were carried out in the ten Canadian provinces.
The retail operations corporate headquarters, distribution centre and warehouses are located in Montreal, Canada.

The accompanying unaudited
consolidated financial statements have been prepared in accordance with accounting principles generally accepted in Canada for interim financial information. Accordingly, they do not include all of the information and disclosures required by
generally accepted accounting principles for complete financial statements.

The consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes thereto for the year ended January 31, 2006. The results of operations for the three month and nine month periods ended October 31, 2006 are not necessarily indicative of the results to be
expected for the entire fiscal year ended January 31, 2007.

The Partnership believes the unaudited consolidated financial statements for the three
month and nine month periods ended October 31, 2006 and the unaudited consolidated financial statements for the three month and nine month periods ended October 31, 2005 included herein contain all adjustments (consisting of normal
recurring adjustments) considered necessary for a fair presentation of the Partnerships financial position as at October 31, 2006 and the Partnerships financial position as at October 31, 2005, and the results of its operations
and cash flows for the periods presented.

The Partnerships accounting policies are consistent with those described in the consolidated financial
statements for the year ended January 31, 2006.



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|2. | Long-Term Debt
|-- | --------------



|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 |         |                 |   |        
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------- | ------- | --------------- | - | -------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | October 31,2006 |         | January 31,2006
|Term bank loan maturing in May 2010, repayable in quarterly capital installments varying from $1,500,000 to $7,500,000 commencing in April
2005. Advances under the term bank loan bear interest at rates varying from 0.75% to 1.25% per annum above the banks prime rate. However, borrowings under the term bank loan by way of bankers acceptances bear interest at rates
varying from 1.75% to 2.25% per annum above bankers acceptances rate |  | $               | 88,000  |                 | $ | 114,000
|Term bank loan (U.S.$242,237,376) maturing in November 2011, repayable in quarterly capital installments of U.S.$608,637. Advances under the
term bank loan bear interest at 1% above the banks prime rate. However, borrowings under the term bank loan by way of Libor rate loans bear interest at 2% per annum above banks Libor rate                                                                                                            |  |                 | 272,057 |                 |   | 277,996
|Redeemable senior subordinated notes (Notes) (U.S.$200,000,000) maturing in August 2012. The Notes bear interest at 8 7/8% payable
semi-annually commencing in February 2006                                                                                                                                                                                                                                                                        |  |                 | 224,620 |                 |   | 227,800
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 |         |                 |   |        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 | 584,677 |                 |   | 619,796
|Current maturity                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 | 2,734   |                 |   | 14,805 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 |         |                 |   |        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 | 581,943 |                 |   | 604,991
|Less: deferred financing costs                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                 | 20,305  |                 |   | 23,354 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 |         |                 |   |        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | $               | 561,638 |                 | $ | 581,637
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                 |         |                 |   |        

On October 31, 2006, the Partnership made a capital repayment of $20,000,000 on the term bank loan maturing
in May 2010, consisting of a prepayment of $17,000,000 and a scheduled payment of $3,000,000.

In accordance with Canadian Institute of Chartered
Accountants Handbook Section 3855 Financial Instruments - Recognition and Measurement, the Partnership has reported deferred financing costs as a reduction of the related long-term debt on the consolidated balance sheets.



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|3. | Commitments and Contingencies
|-- | -----------------------------

At October 31, 2006, there were
contractual obligations for leases amounting to approximately $370,766,000. The leases extend over various periods up to 2024 and it is expected that in the normal course of operations most will be renewed under option clauses or will be
renegotiated.

The basic annual rent (including leases with related parties) exclusive of contingent rentals for the next five years is as follows:



|                 |  |   |        
|---------------- |  | - | -------
|October 31, 2007 |  | $ | 50,382 
|October 31, 2008 |  |   | 47,273 
|October 31, 2009 |  |   | 43,695 
|October 31, 2010 |  |   | 40,795 
|October 31, 2011 |  |   | 37,553 
|Thereafter       |  |   | 151,068

The rent and contingent rent expense for store, warehouse, distribution centre and corporate headquarters
operating leases (including leases with related parties) included in the accompanying consolidated statements of earnings as at October 31, 2006 are as follows:



|                |  |                   |        |                    |   |        |  |      |        |  |   |      
|--------------- |  | ----------------- | ------ | ------------------ | - | ------ |  | ---- | ------ |  | - | -----
|                |  | Nine Months Ended |        | Three Months Ended
|                |  | 2006              |        | 2005               |   | 2006   |  | 2005
|Basic rent      |  | $                 | 32,763 |                    | $ | 27,494 |  | $    | 11,296 |  | $ | 9,590
|Contingent rent |  |                   | 641    |                    |   | 490    |  |      | 228    |  |   | 279  
|                |  |                   |        |                    |   |        |  |      |        |  |   |      
|                |  | $                 | 33,404 |                    | $ | 27,984 |  | $    | 11,524 |  | $ | 9,869
|                |  |                   |        |                    |   |        |  |      |        |  |   |      

Letters of credit issued for purchase of inventories and outstanding as at October 31, 2006 amounted to
$3,922,000 (U.S.$3,492,000).

Two legal proceedings have been instituted against the Partnership for alleged copyright infringement pertaining to the sale
of certain products. The Partnership has denied these claims and believes these claims are without merit. It is not possible at this time to determine the outcome of these matters and accordingly, no provision has been made in the accounts for these
claims.

Legal proceedings have been instituted against the Partnership for alleged personal injuries sustained by customers in the Partnerships
stores. The plaintiffs are claiming amounts totalling $5,400,000. The Partnership believes that the potential amount to be paid for these claims would be covered by its insurance policies other than punitive damages. It is not possible at this time
to determine the outcome of these matters and accordingly, no provision has been made in the accounts for these claims.

The Partnership believes these
suits are without substantial merit and should not result in judgments which in aggregate would have a material adverse effect on the Partnerships financial statements.



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|4. | Derivative Financial Instruments
|-- | --------------------------------

The Partnership has limited
involvement with derivative financial instruments which are utilized to manage risks from fluctuations in exchange rates and interest rates. The Partnership does not hold financial instruments for trading or speculative purposes.

The fair value of foreign currency swaps, foreign exchange forward contracts and the interest rate cap (the Cap) described below at October 31, 2006
totalled approximately ($41,183,000) and totalled approximately ($17,243,000) at October 31, 2005 and has been included in derivative financial instruments on the consolidated balance sheet.

Non-Hedging Derivatives

Swaps

The Partnership has three outstanding swap agreements with its lenders which do not qualify for hedge accounting.

Two swap agreements are a combination derivative consisting of a foreign currency swap and an interest rate swap that expire on January 31, 2011 and were undertaken
to address two risks with its U.S. dollar, LIBOR based term bank loans. The foreign currency swaps enable the Partnership to effectively fix its exchange rate on its principal payments on the U.S. dollar debt to 1.1922. The agreements call for the
Partnership to pay a fixed amount in CDN$ and receive a fixed amount in US$, as indicated in the following table:



|                                     |  |           |  |                                 |        |                                 |   |       
|------------------------------------ |  | --------- |  | ------------------------------- | ------ | ------------------------------- | - | ------
|Date                                 |  | Interval  |  | Amount paidby Partnership(CDN$) |        | Amount receivedfrom lender(US$)
|November 18, 2004 to August 18, 2008 |  | Quarterly |  | $                               | 600    |                                 | $ | 503   
|January 30, 2009                     |  | One time  |  |                                 | 57,061 |                                 |   | 47,866
|January 29, 2010                     |  | One time  |  |                                 | 85,771 |                                 |   | 71,943
|October 30, 2010                     |  | One time  |  |                                 | 88,163 |                                 |   | 73,950

In addition, the swap agreements enable the Partnership to convert the interest rate on the debt from U.S. dollar
LIBOR to Canadian Bankers Acceptance rate and fix the exchange rate on these payments to 1.1922. The agreements provide for the Partnership to pay interest on the stated notional amount at a variable rate of Canadian Bankers Acceptance
rate plus 2.9% (in Canadian Dollars) and to receive interest at LIBOR plus 2.5% (in U.S. dollars) with a fixed U.S. / Cdn dollar conversion rate of 1.1922.



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|4. | Derivative Financial Instruments (Contd)
|-- | -----------------------------------------

The Partnership has
an additional swap agreement with its lenders which is a combination derivative consisting of a foreign currency swap and an interest rate swap that expires on January 31, 2011. The swap agreement was undertaken to address two risks associated
with the additional U.S.$45,000,000 LIBOR based term bank loan obtained in August 2005. The foreign currency swap enables the Partnership to effectively fix its exchange rate on its interest and principal payments on this debt at 1.2015. In
addition, the swap agreement enables the Partnership to convert the interest rate on the debt from U.S. dollar LIBOR to Canadian Bankers Acceptance rate and fix the exchange rate on these payments at 1.2015. The agreement provides for the
Partnership to pay interest on the stated notional amount at a variable rate of Canadian Bankers Acceptance rate plus 2.519% (in Canadian Dollars) and to receive interest at LIBOR plus 2.25% (in U.S. dollars) with a fixed U.S./Cdn dollar
conversion rate of 1.2015.

The fair value of the three above noted swap agreements was ($21,838,000) at October 31, 2006 and ($7,638,000) at
October 31, 2005 and has been included in foreign exchange loss on long-term debt and change in fair value of derivative financial instruments in the consolidated statement of operations and has been included in derivative financial
instruments on the consolidated balance sheet.

Interest Rate Cap

The Partnership has a contract maturing on January 31, 2007 that establishes an interest rate cap which does not qualify for hedge accounting. The Cap was undertaken to address certain interest rate risks
associated with the long-term debt and swap arrangements. The Cap provides for quarterly payments to the Partnership for interest due on the notional amount of $120,000,000 in excess of the Canadians Bankers Acceptance rate cap of 4.5% from
the counterparty.

As at October 31, 2006, the fair value of the Cap is $Nil and $61,000 at October 31, 2005 and has been included in
derivative financial instruments on the consolidated balance sheet. The change in fair value of the Cap has been included in foreign exchange loss on long-term debt and change in fair value of derivative financial instruments
in the consolidated statement of operations.

Hedging Derivatives

The Partnership has foreign exchange forward contracts that qualify as cash flow hedges for hedge accounting. The foreign exchange forward contracts are used to minimize the Partnerships exposure to foreign
currency fluctuations associated with anticipated U.S. dollar denominated purchases.

As at October 31, 2006, the Partnership had foreign exchange
forward contracts to purchase U.S.$130,000,000 for $144,071,000 Canadian maturing between November 2006 and September 2007. The fair value of these contracts outstanding at October 31, 2006 was approximately $1,352,000 which represents the
effective portion of the hedge and is deferred in a separate component in the consolidated statement of partners capital and other comprehensive income until the underlying hedged transactions are reported in the consolidated statement of
operations, which the Company anticipates will take place in the next quarter.



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|4. | Derivative Financial Instruments (Contd)
|-- | -----------------------------------------

Other comprehensive
income also includes a loss of approximately $757,000 which represents losses on foreign exchange contracts settled before October 31, 2006 that will be included in income when the related inventory is sold.

The Partnership has two foreign currency swap agreements with its lenders which were undertaken to mitigate foreign exchange risk associated with the capital and
interest payments on the U.S.$200,000,000 senior subordinated notes. The swap agreements qualify as cash flow hedges for hedge accounting under CICA Section 3865 Hedges. The agreements call for the Partnership to exchange fixed
amounts as follows:



|                                   |  |             |  |                           |         |                            |      |        
|---------------------------------- |  | ----------- |  | ------------------------- | ------- | -------------------------- | ---- | -------
|Date                               |  | Interval    |  | Amount paidby Partnership |         | Amount receivedfrom lender
|August 12, 2005                    |  | One time    |  | US$                       | 200,000 |                            | CDN$ | 240,200
|August 15, 2008                    |  | One time    |  | CDN                       | 84,070  |                            | US   | 70,000 
|August 15, 2012                    |  | One time    |  | CDN                       | 156,130 |                            | US   | 130,000
|February 15, 2006                  |  | One time    |  | CDN                       | 10,171  |                            | US   | 9,023  
|August 15, 2006 to August 15, 2008 |  | Semi-annual |  | CDN                       | 3,340   |                            | US   | 3,106  
|August 15, 2006 to August 15, 2012 |  | Semi-annual |  | CDN                       | 6,534   |                            | US   | 5,769  

The fair value of these swap agreements as at October 31, 2006 was ($20,697,000) and as at October 31,
2005 was ($7,543,000), of which ($3,807,000) was deferred in a separate component in the consolidated statement of partners capital and other comprehensive income until the underlying hedged transactions are reported in the consolidated
statement of operations. The balance of ($16,890,000) was reclassified from accumulated other comprehensive income and taken into earnings. The Partnership anticipates that approximately ($1,281,000) deferred in other comprehensive income will be
recorded in earnings in the next year.

The Partnership periodically examines the effectiveness of the instruments to ensure that they are highly effective
at reducing or modifying foreign exchange risks, associated with anticipated purchases and with the redeemable senior subordinated notes.

Hedging and Non-Hedging Derivatives

The fair value of all swap agreements was ($42,535,000) at October 31, 2006 and ($15,181,000) at
October 31, 2005 and has been included in derivative financial instruments on the consolidated balance sheet. The change in fair value of the swap agreements has been included in foreign exchange loss on long-term debt and
change in fair value of derivative financial instruments with the exception of ($3,807,000) which has been deferred in other comprehensive income (see Hedging Derivatives).



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|5. | Statement of Cash Flows Information
|-- | -----------------------------------

Net change in non-cash working
capital components are as follows:



|                              |  |                   |         |   |                    |   |         |      |  |   |         |   |  |   |        |  
|----------------------------- |  | ----------------- | ------- | - | ------------------ | - | ------- | ---- |  | - | ------- | - |  | - | ------ | -
|                              |  | Nine Months Ended |         |   | Three Months Ended |  
|                              |  | 2006              |         |   | 2005               |   |         | 2006 |  |   | 2005    |  
|Receivables                   |  | $                 | (3,340  | ) |                    | $ | (4,324  | )    |  | $ | (3,306  | ) |  | $ | 1,801  |  
|Income taxes refundable       |  |                   | 404     |   |                    |   | (910    | )    |  |   | 404     |   |  |   | (50    | )
|Deposits and prepaid expenses |  |                   | (2,076  | ) |                    |   | (1,216  | )    |  |   | 779     |   |  |   | 1,233  |  
|Merchandise inventories       |  |                   | (10,505 | ) |                    |   | (39,478 | )    |  |   | (20,037 | ) |  |   | (9,574 | )
|Accounts payable              |  |                   | 11,837  |   |                    |   | (1,974  | )    |  |   | (3,498  | ) |  |   | (2,673 | )
|Accrued expenses and other    |  |                   | 2,548   |   |                    |   | 10,502  |      |  |   | 4,527   |   |  |   | 5,972  |  
|                              |  |                   |         |   |                    |   |         |      |  |   |         |   |  |   |        |  
|                              |  | $                 | (1,132  | ) |                    | $ | (37,400 | )    |  | $ | (21,131 | ) |  | $ | (3,291 | )
|                              |  |                   |         |   |                    |   |         |      |  |   |         |   |  |   |        |  
|                              |  |                  
|                              |  | Nine Months Ended |         |   | Three Months Ended |  
|                              |  | 2006              |         |   | 2005               |   |         | 2006 |  |   | 2005    |  
|Interest paid                 |  | $                 | 40,687  |   |                    | $ | 31,472  |      |  | $ | 17,084  |   |  | $ | 8,778  |  
|Income taxes paid             |  |                   | 860     |   |                    |   | 2,170   |      |  |   | 17      |   |  |   | 503    |  



|6. | Related Party Transactions
|-- | --------------------------

Included in expenses are management
fees of $2,250,000 (2005 - $2,250,000) for the nine month period ended October 31, 2006 (3 months - $750,000; 2005 - $750,000) charged by an affiliate of Bain Capital Partners VIII, LP, the private equity firm that controls the
Partnerships parent.

Expenses include rent charged by related parties as follows:



|                                                                                              |  |                   |       |                    |   |       |  |      |       |  |   |      
|--------------------------------------------------------------------------------------------- |  | ----------------- | ----- | ------------------ | - | ----- |  | ---- | ----- |  | - | -----
|                                                                                              |  | Nine months ended |       | Three months ended
|                                                                                              |  | 2006              |       | 2005               |   | 2006  |  | 2005
|S. Rossy Investments Inc.                                                                     |  | $                 | 892   |                    | $ | 805   |  | $    | 286   |  | $ | 268  
|9076-4028 Québec Inc.                                                                         |  |                   | 4,197 |                    |   | 2,312 |  |      | 1,735 |  |   | 771  
|Minority shareholder of the Partnerships parent and his immediate family                     |  |                   | 46    |                    |   | 37    |  |      | 9     |  |   | 12   
|Entities controlled by immediate family of a minority shareholder of the Partnerships parent |  |                   | 137   |                    |   | 135   |  |      | 59    |  |   | 39   
|                                                                                              |  |                   |       |                    |   |       |  |      |       |  |   |      
|                                                                                              |  | $                 | 5,272 |                    | $ | 3,289 |  | $    | 2,089 |  | $ | 1,090
|                                                                                              |  |                   |       |                    |   |       |  |      |       |  |   |      



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

October 31, 2006

(Unaudited)



|6. | Related Party Transactions (Contd)
|-- | -----------------------------------

S. Rossy Investments Inc.
and 9076-4082 Québec Inc. are companies controlled by a minority shareholder of the Partnerships parent.

Included in accrued expenses and
other is $1,500,000 at October 31, 2006 and $1,423,000 at October 31, 2005 payable to Bain Capital Partners VIII, LP.

These transactions were
measured at the exchange amount which is the amount of the consideration established and agreed to by the related parties.



|7. | Reconciliation of Accounting Principles Generally Accepted in Canada and in the United States
|-- | ---------------------------------------------------------------------------------------------

The Partnership prepared the financial statements in accordance with Canadian generally accepted accounting principles, which conform in all material respects to those in the United States.



|8. | Supplemental Condensed Consolidating Financial Information
|-- | ----------------------------------------------------------

The
following supplemental condensed consolidating financial information sets forth, on an unconsolidated basis, the balance sheets as at October 31, 2006 and January 31, 2006 and the statements of operations and cash flows for the three
months and nine months ended October 31, 2006 and October 31, 2005 for Dollarama Group L.P. (Parent) and on a combined basis for the subsidiaries of the Parent that guarantee the Partnerships senior secured credit
facility and senior subordinated notes (the Guarantor Subsidiaries). The supplemental condensed consolidating financial information reflects the investments of the Parent in the Guarantor Subsidiaries using the equity method.



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Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)

Condensed Consolidating Balance Sheet as at
October 31, 2006



|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|--------------------------------------- |  | ------ | --------- | - | --------------------- | - | --------- | ------------ |  | - | ------------ | - |  | - | --------- | -
|                                        |  | Parent |           |   | GuarantorSubsidiaries |   |           | Eliminations |  |   | Consolidated |  
|Assets                                  |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Current                                 |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Cash and cash equivalents               |  | $      | 65        |   |                       | $ | 26,802    |              |  | $ |             |   |  | $ | 26,867    |  
|Receivables                             |  |        |          |   |                       |   | 6,720     |              |  |   |             |   |  |   | 6,720     |  
|Due from related parties                |  |        | 855,399   |   |                       |   | 853,344   |              |  |   | (1,708,743   | ) |  |   |          |  
|Deposits and prepaid expenses           |  |        | 1,400     |   |                       |   | 3,978     |              |  |   |             |   |  |   | 5,378     |  
|Merchandise inventories                 |  |        |          |   |                       |   | 164,552   |              |  |   |             |   |  |   | 164,552   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|                                        |  |        | 856,864   |   |                       |   | 1,055,396 |              |  |   | (1,708,743   | ) |  |   | 203,517   |  
|Property and Equipment                  |  |        |          |   |                       |   | 78,687    |              |  |   |             |   |  |   | 78,687    |  
|Investments in Guarantor Subsidiaries   |  |        | 174,914   |   |                       |   | 7,762     |              |  |   | (182,676     | ) |  |   |          |  
|Goodwill                                |  |        |          |   |                       |   | 727,782   |              |  |   |             |   |  |   | 727,782   |  
|Other Intangibles                       |  |        |          |   |                       |   | 121,430   |              |  |   |             |   |  |   | 121,430   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Assets                            |  | $      | 1,031,778 |   |                       | $ | 1,991,057 |              |  | $ | (1,891,419   | ) |  | $ | 1,131,416 |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Liabilities                             |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Current                                 |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Accounts payable                        |  |        |          |   |                       |   | 24,115    |              |  |   |             |   |  |   | 24,115    |  
|Accrued expenses and other              |  |        | 4,171     |   |                       |   | 29,989    |              |  |   |             |   |  |   | 34,160    |  
|Income taxes payable                    |  |        |          |   |                       |   | 265       |              |  |   |             |   |  |   | 265       |  
|Derivative financial instruments        |  |        |          |   |                       |   | 41,183    |              |  |   |             |   |  |   | 41,183    |  
|Due to related parties                  |  |        |          |   |                       |   | 1,716,336 |              |  |   | (1,716,336   | ) |  |   |          |  
|Current portion of long-term debt       |  |        | 2,734     |   |                       |   |          |              |  |   |             |   |  |   | 2,734     |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|                                        |  |        | 6,905     |   |                       |   | 1,811,888 |              |  |   | (1,716,336   | ) |  |   | 102,457   |  
|Long-Term Debt                          |  |        | 581,944   |   |                       |   | (20,306   | )            |  |   |             |   |  |   | 561,638   |  
|Unfavorable Lease Rights and Other      |  |        |          |   |                       |   | 24,392    |              |  |   |             |   |  |   | 24,392    |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Liabilities                       |  |        | 588,849   |   |                       |   | 1,815,974 |              |  |   | (1,716,336   | ) |  |   | 688,487   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Partners Capital                       |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|General Partner                         |  |        | 374       |   |                       |   | 209,368   |              |  |   | (209,368     | ) |  |   | 374       |  
|Limited Partner                         |  |        | 390,660   |   |                       |   |          |              |  |   |             |   |  |   | 390,660   |  
|Contributed Surplus                     |  |        | 1,263     |   |                       |   |          |              |  |   |             |   |  |   | 1,263     |  
|Retained Earnings (Deficit)             |  |        | 54,555    |   |                       |   | (34,285   | )            |  |   | 34,285       |   |  |   | 54,555    |  
|Accumulated Other Comprehensive Loss    |  |        | (3,923    | ) |                       |   |          |              |  |   |             |   |  |   | (3,923    | )
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Partners Capital                 |  |        | 442,929   |   |                       |   | 175,083   |              |  |   | (175,083     | ) |  |   | 442,929   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Liabilities and Partners Capital |  | $      | 1,031,778 |   |                       | $ | 1,991,057 |              |  | $ | (1,891,419   | ) |  | $ | 1,131,416 |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  



- 15 -



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)



Condensed Consolidating Balance Sheet as at January 31, 2006



|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|--------------------------------------- |  | ------ | --------- | - | --------------------- | - | --------- | ------------ |  | - | ------------ | - |  | - | --------- | -
|                                        |  | Parent |           |   | GuarantorSubsidiaries |   |           | Eliminations |  |   | Consolidated |  
|Assets                                  |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Current                                 |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Cash and cash equivalents               |  | $      | 52        |   |                       | $ | 30,831    |              |  | $ |             |   |  | $ | 30,883    |  
|Receivables                             |  |        |          |   |                       |   | 3,380     |              |  |   |             |   |  |   | 3,380     |  
|Due from related parties                |  |        | 889,366   |   |                       |   | 884,068   |              |  |   | (1,773,434   | ) |  |   |          |  
|Income taxes refundable                 |  |        |          |   |                       |   | 139       |              |  |   |             |   |  |   | 139       |  
|Deposits and prepaid expenses           |  |        |          |   |                       |   | 3,302     |              |  |   |             |   |  |   | 3,302     |  
|Merchandise inventories                 |  |        |          |   |                       |   | 154,047   |              |  |   |             |   |  |   | 154,047   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|                                        |  |        | 889,418   |   |                       |   | 1,075,767 |              |  |   | (1,773,434   | ) |  |   | 191,751   |  
|Property and Equipment                  |  |        |          |   |                       |   | 54,571    |              |  |   |             |   |  |   | 54,571    |  
|Investments in Guarantor Subsidiaries   |  |        | 140,151   |   |                       |   | 8,196     |              |  |   | (148,347     | ) |  |   |          |  
|Goodwill                                |  |        |          |   |                       |   | 727,782   |              |  |   |             |   |  |   | 727,782   |  
|Other Intangibles                       |  |        |          |   |                       |   | 124,750   |              |  |   |             |   |  |   | 124,750   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Assets                            |  | $      | 1,029,569 |   |                       | $ | 1,991,066 |              |  | $ | (1,921,781   | ) |  | $ | 1,098,854 |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Liabilities                             |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Current                                 |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Accounts payable                        |  |        |          |   |                       |   | 12,278    |              |  |   |             |   |  |   | 12,278    |  
|Accrued expenses and other              |  |        | 7,953     |   |                       |   | 23,659    |              |  |   |             |   |  |   | 31,612    |  
|Derivative financial instruments        |  |        |          |   |                       |   | 34,531    |              |  |   |             |   |  |   | 34,531    |  
|Due to related parties                  |  |        |          |   |                       |   | 1,781,476 |              |  |   | (1,781,476   | ) |  |   |          |  
|Current portion of long-term debt       |  |        | 14,805    |   |                       |   |          |              |  |   |             |   |  |   | 14,805    |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|                                        |  |        | 22,758    |   |                       |   | 1,851,944 |              |  |   | (1,781,476   | ) |  |   | 93,226    |  
|Long-Term Debt                          |  |        | 604,991   |   |                       |   | (23,354   | )            |  |   |             |   |  |   | 581,637   |  
|Unfavorable Lease Rights and Other      |  |        |          |   |                       |   | 22,171    |              |  |   |             |   |  |   | 22,171    |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Liabilities                       |  |        | 627,749   |   |                       |   | 1,850,761 |              |  |   | (1,781,476   | ) |  |   | 697,034   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Partners Capital                       |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|General Partner                         |  |        | 374       |   |                       |   | 192,170   |              |  |   | (192,170     | ) |  |   | 374       |  
|Limited Partner                         |  |        | 394,876   |   |                       |   |          |              |  |   |             |   |  |   | 394,876   |  
|Contributed Surplus                     |  |        | 800       |   |                       |   |          |              |  |   |             |   |  |   | 800       |  
|Retained Earnings (Deficit)             |  |        | 11,800    |   |                       |   | (51,865   | )            |  |   | 51,865       |   |  |   | 11,800    |  
|Accumulated Other Comprehensive Loss    |  |        | (6,030    | ) |                       |   |          |              |  |   |             |   |  |   | (6,030    | )
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Partners Capital                 |  |        | 401,820   |   |                       |   | 140,305   |              |  |   | (140,305     | ) |  |   | 401,820   |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  
|Total Liabilities and Partners Capital |  | $      | 1,029,569 |   |                       | $ | 1,991,066 |              |  | $ | (1,921,781   | ) |  | $ | 1,098,854 |  
|                                        |  |        |           |   |                       |   |           |              |  |   |              |   |  |   |           |  



- 16 -



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)

Condensed Consolidating Statement of Operations For
the 9 Months Ended October 31, 2006



|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|----------------------------------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------------ |  | - | ------------ | - |  | - | ------- | -
|                                                                                                |  | Parent |         |   | GuarantorSubsidiaries |   | Eliminations |  |   | Consolidated |  
|Sales                                                                                           |  | $      |        |   |                       | $ | 611,560      |  | $ |             |   |  | $ | 611,560 |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Cost of Sales and Expenses                                                                      |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Cost of sales                                                                                   |  |        |        |   |                       |   | 410,533      |  |   |             |   |  |   | 410,533 |  
|General, administrative and store operating expenses                                            |  |        |        |   |                       |   | 107,382      |  |   |             |   |  |   | 107,382 |  
|Amortization                                                                                    |  |        |        |   |                       |   | 11,918       |  |   |             |   |  |   | 11,918  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|                                                                                                |  |        |        |   |                       |   | 529,833      |  |   |             |   |  |   | 529,833 |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Operating Income                                                                                |  |        |        |   |                       |   | 81,727       |  |   |             |   |  |   | 81,727  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Amortization of deferred financing costs                                                        |  |        |        |   |                       |   | 3,050        |  |   |             |   |  |   | 3,050   |  
|Interest expense (income)                                                                       |  |        | (21,297 | ) |                       |   | 56,634       |  |   |             |   |  |   | 35,337  |  
|Foreign exchange on long-term debt and change in fair value of derivative financial instruments |  |        | (3,878  | ) |                       |   | 3,199        |  |   |             |   |  |   | (679    | )
|Share in loss (earnings) of guarantor subsidiaries                                              |  |        | (17,580 | ) |                       |   |             |  |   | 17,580       |   |  |   |        |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|                                                                                                |  |        | (42,755 | ) |                       |   | 62,883       |  |   | 17,580       |   |  |   | 37,708  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Earnings (Loss) Before Income Taxes                                                             |  |        | 42,755  |   |                       |   | 18,844       |  |   | (17,580      | ) |  |   | 44,019  |  
|Income taxes                                                                                    |  |        |        |   |                       |   | 1,264        |  |   |             |   |  |   | 1,264   |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Net Earnings (Loss)                                                                             |  | $      | 42,755  |   |                       | $ | 17,580       |  | $ | (17,580      | ) |  | $ | 42,755  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  

Condensed Consolidating Statement of Operations For the 9 Months Ended October 31, 2005



|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|----------------------------------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | -------
|                                                                                                |  | Parent |         |   | GuarantorSubsidiaries |   |         | Eliminations |  |   | Consolidated
|Sales                                                                                           |  | $      |        |   |                       | $ | 517,496 |              |  | $ |             |   |  | $ | 517,496
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Cost of Sales and Expenses                                                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Cost of sales                                                                                   |  |        |        |   |                       |   | 357,771 |              |  |   |             |   |  |   | 357,771
|General, administrative and store operating expenses                                            |  |        |        |   |                       |   | 88,878  |              |  |   |             |   |  |   | 88,878 
|Amortization                                                                                    |  |        |        |   |                       |   | 9,688   |              |  |   |             |   |  |   | 9,688  
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|                                                                                                |  |        |        |   |                       |   | 456,337 |              |  |   |             |   |  |   | 456,337
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Operating Income                                                                                |  |        |        |   |                       |   | 61,159  |              |  |   |             |   |  |   | 61,159 
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Amortization of deferred financing costs                                                        |  |        |        |   |                       |   | 6,494   |              |  |   |             |   |  |   | 6,494  
|Write-off of deferred financing costs                                                           |  |        |        |   |                       |   | 6,606   |              |  |   |             |   |  |   | 6,606  
|Interest expense (income)                                                                       |  |        | (24,740 | ) |                       |   | 58,859  |              |  |   |             |   |  |   | 34,119 
|Foreign exchange on long-term debt and change in fair value of derivative financial instruments |  |        | (16,157 | ) |                       |   | 18,634  |              |  |   |             |   |  |   | 2,477  
|Share in loss (earnings) of guarantor subsidiaries                                              |  |        | 30,694  |   |                       |   |        |              |  |   | (30,694      | ) |  |   |       
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|                                                                                                |  |        | (10,203 | ) |                       |   | 90,593  |              |  |   | (30,694      | ) |  |   | 49,696 
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Earnings (Loss) Before Income Taxes                                                             |  |        | 10,203  |   |                       |   | (29,434 | )            |  |   | 30,694       |   |  |   | 11,463 
|Income taxes                                                                                    |  |        |        |   |                       |   | 1,260   |              |  |   |             |   |  |   | 1,260  
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Net Earnings (Loss)                                                                             |  | $      | 10,203  |   |                       | $ | (30,694 | )            |  | $ | 30,694       |   |  | $ | 10,203 
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        



- 17 -



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)



Condensed Consolidating Statement of Operations For the 3 Months Ended October 31, 2006



|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|----------------------------------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------------ |  | - | ------------ | - |  | - | ------- | -
|                                                                                                |  | Parent |         |   | GuarantorSubsidiaries |   | Eliminations |  |   | Consolidated |  
|Sales                                                                                           |  | $      |        |   |                       | $ | 218,477      |  | $ |             |   |  | $ | 218,477 |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Cost of Sales and Expenses                                                                      |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Cost of sales                                                                                   |  |        |        |   |                       |   | 146,452      |  |   |             |   |  |   | 146,452 |  
|General, administrative and store operating expenses                                            |  |        |        |   |                       |   | 37,405       |  |   |             |   |  |   | 37,405  |  
|Amortization                                                                                    |  |        |        |   |                       |   | 4,464        |  |   |             |   |  |   | 4,464   |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|                                                                                                |  |        |        |   |                       |   | 188,321      |  |   |             |   |  |   | 188,321 |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Operating Income                                                                                |  |        |        |   |                       |   | 30,156       |  |   |             |   |  |   | 30,156  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Amortization of deferred financing costs                                                        |  |        |        |   |                       |   | 1,015        |  |   |             |   |  |   | 1,015   |  
|Interest expense (income)                                                                       |  |        | (7,205  | ) |                       |   | 19,206       |  |   |             |   |  |   | 12,001  |  
|Foreign exchange on long-term debt and change in fair value of derivative financial instruments |  |        | (2,064  | ) |                       |   | 1,371        |  |   |             |   |  |   | (693    | )
|Share in loss (earnings) of guarantor subsidiaries                                              |  |        | (8,143  | ) |                       |   |             |  |   | 8,143        |   |  |   |        |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|                                                                                                |  |        | (17,412 | ) |                       |   | 21,592       |  |   | 8,143        |   |  |   | 12,323  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Earnings (Loss) Before Income Taxes                                                             |  |        | 17,412  |   |                       |   | 8,564        |  |   | (8,143       | ) |  |   | 17,833  |  
|Income taxes                                                                                    |  |        |        |   |                       |   | 421          |  |   |             |   |  |   | 421     |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  
|Net Earnings (Loss)                                                                             |  | $      | 17,412  |   |                       | $ | 8,143        |  | $ | (8,143       | ) |  | $ | 17,412  |  
|                                                                                                |  |        |         |   |                       |   |              |  |   |              |   |  |   |         |  

Condensed Consolidating Statement of Operations For the 3 Months Ended October 31, 2005



|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|----------------------------------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | -------
|                                                                                                |  | Parent |         |   | GuarantorSubsidiaries |   |         | Eliminations |  |   | Consolidated
|Sales                                                                                           |  | $      |        |   |                       | $ | 186,542 |              |  | $ |             |   |  | $ | 186,542
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Cost of Sales and Expenses                                                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Cost of sales                                                                                   |  |        |        |   |                       |   | 124,047 |              |  |   |             |   |  |   | 124,047
|General, administrative and store operating expenses                                            |  |        |        |   |                       |   | 30,871  |              |  |   |             |   |  |   | 30,871 
|Amortization                                                                                    |  |        |        |   |                       |   | 3,287   |              |  |   |             |   |  |   | 3,287  
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|                                                                                                |  |        |        |   |                       |   | 158,205 |              |  |   |             |   |  |   | 158,205
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Operating Income                                                                                |  |        |        |   |                       |   | 28,337  |              |  |   |             |   |  |   | 28,337 
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Amortization of deferred financing costs                                                        |  |        |        |   |                       |   | 1,011   |              |  |   |             |   |  |   | 1,011  
|Write-off of deferred financing costs                                                           |  |        |        |   |                       |   | 6,606   |              |  |   |             |   |  |   | 6,606  
|Interest expense (income)                                                                       |  |        | (7,538  | ) |                       |   | 19,209  |              |  |   |             |   |  |   | 11,671 
|Foreign exchange on long-term debt and change in fair value of derivative financial instruments |  |        | (12,733 | ) |                       |   | 14,974  |              |  |   |             |   |  |   | 2,241  
|Share in loss (earnings) of guarantor subsidiaries                                              |  |        | 13,916  |   |                       |   |        |              |  |   | (13,916      | ) |  |   |       
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|                                                                                                |  |        | (6,355  | ) |                       |   | 41,800  |              |  |   | (13,916      | ) |  |   | 21,529 
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Earnings (Loss) Before Income Taxes                                                             |  |        | 6,355   |   |                       |   | (13,463 | )            |  |   | 13,916       |   |  |   | 6,808  
|Income taxes                                                                                    |  |        |        |   |                       |   | 453     |              |  |   |             |   |  |   | 453    
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        
|Net Earnings (Loss)                                                                             |  | $      | 6,355   |   |                       | $ | (13,916 | )            |  | $ | 13,916       |   |  | $ | 6,355  
|                                                                                                |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |        



- 18 -



---

##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)

Condensed Consolidating Statement of Cash Flows For
the 9 Months Ended October 31, 2006



|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|--------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | ------- | -
|                                                          |  | Parent |         |   | GuarantorSubsidiaries |   |         | Eliminations |  |   | Consolidated |  
|Cash Provided (Used) -                                    |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Operating Activities                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net earnings (loss)                                       |  | $      | 42,755  |   |                       | $ | 17,580  |              |  | $ | (17,580      | ) |  | $ | 42,755  |  
|Share in loss (earnings) of guarantor subsidiaries        |  |        | (17,580 | ) |                       |   |        |              |  |   | 17,580       |   |  |   |        |  
|Amortization of property and equipment                    |  |        |        |   |                       |   | 8,277   |              |  |   |             |   |  |   | 8,277   |  
|Amortization of intangibles                               |  |        |        |   |                       |   | 3,641   |              |  |   |             |   |  |   | 3,641   |  
|Loss on disposal of property and equipment                |  |        |        |   |                       |   | 41      |              |  |   |             |   |  |   | 41      |  
|Change in fair value of non-hedging derivatives           |  |        |        |   |                       |   | 4,471   |              |  |   |             |   |  |   | 4,471   |  
|Change in fair value of hedging derivatives               |  |        |        |   |                       |   | 4,287   |              |  |   |             |   |  |   | 4,287   |  
|Amortization of deferred financing costs                  |  |        |        |   |                       |   | 3,050   |              |  |   |             |   |  |   | 3,050   |  
|Foreign exchange gain on long-term debt                   |  |        | (3,878  | ) |                       |   |        |              |  |   |             |   |  |   | (3,878  | )
|Amortization of unfavorable lease rights                  |  |        |        |   |                       |   | (2,669  | )            |  |   |             |   |  |   | (2,669  | )
|Deferred lease inducements                                |  |        |        |   |                       |   | 2,221   |              |  |   |             |   |  |   | 2,221   |  
|Amortization of deferred tenant allowances                |  |        |        |   |                       |   | (387    | )            |  |   |             |   |  |   | (387    | )
|Amortization of deferred leasing costs                    |  |        |        |   |                       |   | 102     |              |  |   |             |   |  |   | 102     |  
|Stock-based compensation                                  |  |        |        |   |                       |   | 463     |              |  |   |             |   |  |   | 463     |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|                                                          |  |        | 21,297  |   |                       |   | 41,077  |              |  |   |             |   |  |   | 62,374  |  
|Changes in non-cash operating elements of working capital |  |        | (5,182  | ) |                       |   | 4,050   |              |  |   |             |   |  |   | (1,132  | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net Cash Provided by Operating Activities                 |  |        | 16,115  |   |                       |   | 45,127  |              |  |   |             |   |  |   | 61,242  |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Investing Activities                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Due from related parties                                  |  |        | 36,538  |   |                       |   | (36,987 | )            |  |   | 449          |   |  |   |        |  
|Investments in guarantor subsidiaries                     |  |        | (17,183 | ) |                       |   | 434     |              |  |   | 16,749       |   |  |   |        |  
|Purchase of property and equipment                        |  |        |        |   |                       |   | (32,588 | )            |  |   |             |   |  |   | (32,588 | )
|Proceeds on disposal of property and equipment            |  |        |        |   |                       |   | 154     |              |  |   |             |   |  |   | 154     |  
|Deferred tenant allowances                                |  |        |        |   |                       |   | 3,056   |              |  |   |             |   |  |   | 3,056   |  
|Deferred leasing costs                                    |  |        |        |   |                       |   | (423    | )            |  |   |             |   |  |   | (423    | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net Cash Provided By (Used In) Investing Activities       |  |        | 19,355  |   |                       |   | (66,354 | )            |  |   | 17,198       |   |  |   | (29,801 | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Financing Activities                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Repayment of long-term debt                               |  | $      | (28,061 | ) |                       | $ |        |              |  | $ |             |   |  | $ | (28,061 | )
|Capital distributions                                     |  |        | (4,216  | ) |                       |   | 17,198  |              |  |   | (17,198      | ) |  |   | (4,216  | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net Cash Provided By (Used in) Financing Activities       |  |        | (32,277 | ) |                       |   | 17,198  |              |  |   | (17,198      | ) |  |   | (32,277 | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Foreign currency translation adjustment                   |  |        | (3,180  | ) |                       |   |        |              |  |   |             |   |  |   | (3,180  | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Increase (Decrease) in Cash and Cash Equivalents          |  |        | 13      |   |                       |   | (4,029  | )            |  |   |             |   |  |   | (4,016  | )
|Cash and Cash Equivalents Beginning of Period             |  |        | 52      |   |                       |   | 30,831  |              |  |   |             |   |  |   | 30,883  |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|End of Period                                             |  | $      | 65      |   |                       | $ | 26,802  |              |  | $ |             |   |  | $ | 26,867  |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  



- 19 -



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##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)

Condensed Consolidating Statement of Cash Flows For
the 9 Months Ended October 31, 2005



|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|--------------------------------------------------------- |  | ------ | -------- | - | --------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | -------- | -
|                                                          |  | Parent |          |   | GuarantorSubsidiaries |   |         | Eliminations |  |   | Consolidated |  
|Cash Provided (Used) -                                    |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Operating Activities                                      |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net earnings (loss)                                       |  | $      | 10,203   |   |                       | $ | (30,694 | )            |  | $ | 30,694       |   |  | $ | 10,203   |  
|Share in loss (earnings) of guarantor subsidiaries        |  |        | 30,694   |   |                       |   |        |              |  |   | (30,694      | ) |  |   |         |  
|Amortization of property and equipment                    |  |        |         |   |                       |   | 6,138   |              |  |   |             |   |  |   | 6,138    |  
|Amortization of intangibles                               |  |        |         |   |                       |   | 3,550   |              |  |   |             |   |  |   | 3,550    |  
|Change in fair value of non-hedging derivatives           |  |        |         |   |                       |   | 19,081  |              |  |   |             |   |  |   | 19,081   |  
|Amortization of deferred financing costs                  |  |        |         |   |                       |   | 6,494   |              |  |   |             |   |  |   | 6,494    |  
|Write-off of deferred financing costs                     |  |        |         |   |                       |   | 6,606   |              |  |   |             |   |  |   | 6,606    |  
|Foreign exchange gain on long-term debt                   |  |        | (16,157  | ) |                       |   |        |              |  |   |             |   |  |   | (16,157  | )
|Amortization of unfavorable lease rights                  |  |        |         |   |                       |   | (2,620  | )            |  |   |             |   |  |   | (2,620   | )
|Deferred lease inducements                                |  |        |         |   |                       |   | 3,342   |              |  |   |             |   |  |   | 3,342    |  
|Stock-based compensation                                  |  |        |         |   |                       |   | 837     |              |  |   |             |   |  |   | 837      |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|                                                          |  |        | 24,740   |   |                       |   | 12,734  |              |  |   |             |   |  |   | 37,474   |  
|Changes in non-cash operating elements of working capital |  |        | 2,427    |   |                       |   | (39,827 | )            |  |   |             |   |  |   | (37,400  | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net Cash Provided by (Used In) Operating Activities       |  |        | 27,167   |   |                       |   | (27,093 | )            |  |   |             |   |  |   | 74       |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Investing Activities                                      |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Due from related parties                                  |  |        | (1,784   | ) |                       |   | 6,264   |              |  |   | (4,480       | ) |  |   |         |  
|Investments in guarantor subsidiaries                     |  |        | (14,132  | ) |                       |   | (6,958  | )            |  |   | 21,090       |   |  |   |         |  
|Purchase of property and equipment                        |  |        |         |   |                       |   | (15,222 | )            |  |   |             |   |  |   | (15,222  | )
|Proceeds on disposal of property and equipment            |  |        |         |   |                       |   | 182     |              |  |   |             |   |  |   | 182      |  
|Deferred tenant allowances                                |  |        |         |   |                       |   |        |              |  |   |             |   |  |   |         |  
|Deferred leasing costs                                    |  |        |         |   |                       |   | (1,462  | )            |  |   |             |   |  |   | (1,462   | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net Cash Provided By (Used In) Investing Activities       |  | $      | (15,916  | ) |                       | $ | (17,196 | )            |  | $ | 16,610       |   |  | $ | (16,502  | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Financing Activities                                      |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Due to company controlled by minority shareholder         |  | $      |         |   |                       | $ | (2,468  | )            |  | $ |             |   |  | $ | (2,468   | )
|Deferred financing costs                                  |  |        |         |   |                       |   | (9,822  | )            |  |   |             |   |  |   | (9,822   | )
|Proceeds from long-term debt                              |  |        | 293,533  |   |                       |   |        |              |  |   |             |   |  |   | 293,533  |  
|Repayment of long-term debt                               |  |        | (246,477 | ) |                       |   |        |              |  |   |             |   |  |   | (246,477 | )
|Capital distributions                                     |  |        | (58,349  | ) |                       |   | 16,610  |              |  |   | (16,610      | ) |  |   | (58,349  | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net Cash Provided By (Used in) Financing Activities       |  |        | (11,293  | ) |                       |   | 4,320   |              |  |   | (16,610      | ) |  |   | (23,583  | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Decrease in Cash and Cash Equivalents                     |  |        | (42      | ) |                       |   | (39,969 | )            |  |   |             |   |  |   | (40,011  | )
|Cash and Cash Equivalents Beginning of Period             |  |        | 451      |   |                       |   | 44,134  |              |  |   |             |   |  |   | 44,585   |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|End of Period                                             |  | $      | 409      |   |                       | $ | 4,165   |              |  | $ |             |   |  | $ | 4,574    |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  



- 20 -



---

##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)

Condensed Consolidating Statement of Cash Flows For
the 3 Months Ended October 31, 2006



|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|--------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | ------- | -
|                                                          |  | Parent |         |   | GuarantorSubsidiaries |   |         | Eliminations |  |   | Consolidated |  
|Cash Provided (Used) -                                    |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Operating Activities                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net earnings (loss)                                       |  | $      | 17,412  |   |                       | $ | 8,143   |              |  | $ | (8,143       | ) |  | $ | 17,412  |  
|Share in loss (earnings) of guarantor subsidiaries        |  |        | (8,143  | ) |                       |   |        |              |  |   | 8,143        |   |  |   |        |  
|Amortization of property and equipment                    |  |        |        |   |                       |   | 3,022   |              |  |   |             |   |  |   | 3,022   |  
|Amortization of intangibles                               |  |        |        |   |                       |   | 1,442   |              |  |   |             |   |  |   | 1,442   |  
|Loss on disposal of property and equipment                |  |        |        |   |                       |   | 21      |              |  |   |             |   |  |   | 21      |  
|Change in fair value of non-hedging derivatives           |  |        |        |   |                       |   | 1,851   |              |  |   |             |   |  |   | 1,851   |  
|Change in fair value of hedging derivatives               |  |        |        |   |                       |   | 2,880   |              |  |   |             |   |  |   | 2,880   |  
|Amortization of deferred financing costs                  |  |        |        |   |                       |   | 1,015   |              |  |   |             |   |  |   | 1,015   |  
|Foreign exchange gain on long-term debt                   |  |        | (2,064  | ) |                       |   |        |              |  |   |             |   |  |   | (2,064  | )
|Amortization of unfavorable lease rights                  |  |        |        |   |                       |   | (1,049  | )            |  |   |             |   |  |   | (1,049  | )
|Deferred lease inducements                                |  |        |        |   |                       |   | 664     |              |  |   |             |   |  |   | 664     |  
|Amortization of deferred tenant allowances                |  |        |        |   |                       |   | (170    | )            |  |   |             |   |  |   | (170    | )
|Amortization of deferred leasing costs                    |  |        |        |   |                       |   | 38      |              |  |   |             |   |  |   | 38      |  
|Stock-based compensation                                  |  |        |        |   |                       |   | 155     |              |  |   |             |   |  |   | 155     |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|                                                          |  |        | 7,205   |   |                       |   | 18,012  |              |  |   |             |   |  |   | 25,217  |  
|Changes in non-cash operating elements of working capital |  |        | (4,702  | ) |                       |   | (16,429 | )            |  |   |             |   |  |   | (21,131 | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net Cash Provided by Operating Activities                 |  |        | 2,503   |   |                       |   | 1,583   |              |  |   |             |   |  |   | 4,086   |  
|Investing Activities                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Due from related parties                                  |  |        | 27,014  |   |                       |   | (27,332 | )            |  |   | 318          |   |  |   |        |  
|Investments in guarantor subsidiaries                     |  |        | (5,798  | ) |                       |   | 314     |              |  |   | 5,484        |   |  |   |        |  
|Purchase of property and equipment                        |  |        |        |   |                       |   | (12,596 | )            |  |   |             |   |  |   | (12,596 | )
|Proceeds on disposal of property and equipment            |  |        |        |   |                       |   | 51      |              |  |   |             |   |  |   | 51      |  
|Deferred tenant allowances                                |  |        |        |   |                       |   | 876     |              |  |   |             |   |  |   | 876     |  
|Deferred leasing costs                                    |  |        |        |   |                       |   | (40     | )            |  |   |             |   |  |   | (40     | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net Cash Provided By (Used In) Investing Activities       |  |        | 21,216  |   |                       |   | (38,727 | )            |  |   | 5,802        |   |  |   | (11,709 | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Financing Activities                                      |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Due to company controlled by minority shareholder         |  | $      |        |   |                       | $ |        |              |  | $ |             |   |  | $ |        |  
|Deferred financing costs                                  |  |        |        |   |                       |   |        |              |  |   |             |   |  |   |        |  
|Repayment of long-term debt                               |  |        | (20,684 | ) |                       |   |        |              |  |   |             |   |  |   | (20,684 | )
|Capital distributions                                     |  |        | (1,335  | ) |                       |   | 5,802   |              |  |   | (5,802       | ) |  |   | (1,335  | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Net Cash Provided By (Used In) Financing Activities       |  |        | (22,019 | ) |                       |   | 5,802   |              |  |   | (5,802       | ) |  |   | (22,019 | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Foreign currency translation adjustment                   |  |        | (1,700  | ) |                       |   |        |              |  |   |             |   |  |   | (1,700  | )
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|Decrease in Cash and Cash Equivalents                     |  |        |        |   |                       |   | (31,342 | )            |  |   |             |   |  |   | (31,342 | )
|Cash and Cash Equivalents - Beginning of Period           |  |        | 65      |   |                       |   | 58,144  |              |  |   |             |   |  |   | 58,209  |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  
|End of Period                                             |  | $      | 65      |   |                       | $ | 26,802  |              |  | $ |             |   |  | $ | 26,867  |  
|                                                          |  |        |         |   |                       |   |         |              |  |   |              |   |  |   |         |  



- 21 -



---

##### Table of Contents

Dollarama Group L.P. - Groupe Dollarama S.E.C.

Notes to Consolidated Financial Statements

(In Thousands of Canadian Dollars)

(Unaudited)

Condensed Consolidating Statement of Cash Flows For
the 3 Months Ended October 31, 2005



|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|--------------------------------------------------------- |  | ------ | -------- | - | --------------------- | - | ------- | ------------ |  | - | ------------ | - |  | - | -------- | -
|                                                          |  | Parent |          |   | GuarantorSubsidiaries |   |         | Eliminations |  |   | Consolidated |  
|Cash Provided (Used) -                                    |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Operating Activities                                      |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net earnings (loss)                                       |  | $      | 6,355    |   |                       | $ | (13,916 | )            |  | $ | 13,916       |   |  | $ | 6,355    |  
|Share in loss (earnings) of guarantor subsidiaries        |  |        | 13,916   |   |                       |   |        |              |  |   | (13,916      | ) |  |   |         |  
|Amortization of property and equipment                    |  |        |         |   |                       |   | 2,114   |              |  |   |             |   |  |   | 2,114    |  
|Amortization of intangibles                               |  |        |         |   |                       |   | 1,173   |              |  |   |             |   |  |   | 1,173    |  
|Change in fair value of non-hedging derivatives           |  |        |         |   |                       |   | 14,006  |              |  |   |             |   |  |   | 14,006   |  
|Amortization of deferred financing costs                  |  |        |         |   |                       |   | 1,011   |              |  |   |             |   |  |   | 1,011    |  
|Write-off of deferred financing costs                     |  |        |         |   |                       |   | 6,606   |              |  |   |             |   |  |   | 6,606    |  
|Foreign exchange gain on long-term debt                   |  |        | (12,733  | ) |                       |   |        |              |  |   |             |   |  |   | (12,733  | )
|Amortization of unfavorable lease rights                  |  |        |         |   |                       |   | (837    | )            |  |   |             |   |  |   | (837     | )
|Deferred lease inducements                                |  |        |         |   |                       |   | 899     |              |  |   |             |   |  |   | 899      |  
|Stock-based compensation                                  |  |        |         |   |                       |   | 349     |              |  |   |             |   |  |   | 349      |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|                                                          |  |        | 7,538    |   |                       |   | 11,405  |              |  |   |             |   |  |   | 18,943   |  
|Changes in non-cash operating elements of working capital |  |        | 4,171    |   |                       |   | (7,462  | )            |  |   |             |   |  |   | (3,291   | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net Cash Provided by Operating Activities                 |  |        | 11,709   |   |                       |   | 3,943   |              |  |   |             |   |  |   | 15,652   |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Investing Activities                                      |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Due from related parties                                  |  |        | (7,609   | ) |                       |   | 4,487   |              |  |   | 3,122        |   |  |   |         |  
|Investments in guarantor subsidiaries                     |  |        | (52      | ) |                       |   | 734     |              |  |   | (682         | ) |  |   |         |  
|Purchase of property and equipment                        |  |        |         |   |                       |   | (6,477  | )            |  |   |             |   |  |   | (6,477   | )
|Proceeds on disposal of property and equipment            |  |        |         |   |                       |   | 70      |              |  |   |             |   |  |   | 70       |  
|Deferred leasing costs                                    |  |        |         |   |                       |   | (1,462  | )            |  |   |             |   |  |   | (1,462   | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net Cash Provided By (Used In) Investing Activities       |  | $      | (7,661   | ) |                       | $ | (2,648  | )            |  | $ | 2,440        |   |  | $ | (7,869   | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Financing Activities                                      |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Due to company controlled by a minority shareholder       |  | $      |         |   |                       | $ | (2,425  | )            |  | $ |             |   |  | $ | (2,425   | )
|Deferred financing costs                                  |  |        |         |   |                       |   | (7,973  | )            |  |   |             |   |  |   | (7,973   | )
|Proceeds from long-term debt                              |  |        | 293,533  |   |                       |   |        |              |  |   |             |   |  |   | 293,533  |  
|Repayment of long-term debt                               |  |        | (242,227 | ) |                       |   |        |              |  |   |             |   |  |   | (242,227 | )
|Capital distributions                                     |  |        | (54,976  | ) |                       |   | 2,440   |              |  |   | (2,440       | ) |  |   | (54,976  | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Net Cash Used In Financing Activities                     |  |        | (3,670   | ) |                       |   | (7,958  | )            |  |   | (2,440       | ) |  |   | (14,068  | )
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|Increase (Decrease) in Cash and Cash Equivalents          |  |        | 378      |   |                       |   | (6,663  | )            |  |   |             |   |  |   | (6,285   | )
|Cash and Cash Equivalents - Beginning of Period           |  |        | 32       |   |                       |   | 10,827  |              |  |   |             |   |  |   | 10,859   |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  
|End of Period                                             |  | $      | 410      |   |                       | $ | 4,164   |              |  | $ |             |   |  | $ | 4,574    |  
|                                                          |  |        |          |   |                       |   |         |              |  |   |              |   |  |   |          |  



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|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited
consolidated financial statements and notes thereto appearing in this report. Any references to we, us and our refer to Dollarama Group L.P. and Dollarama Corporation.

Our functional and reporting currency is the Canadian dollar. Financial data has been prepared in conformity with Generally Accepted Accounting
Principles (GAAP) in Canada. There are no material differences between U.S. GAAP and Canadian GAAP in our consolidated financial statements for the three and nine month periods ended October 31, 2005 and October 31, 2006.
However, certain measures used in this discussion and analysis do not have any standardized meaning under Canadian GAAP. When used, these measures are defined in such terms as to allow the reconciliation to the closest Canadian GAAP measure. It is
unlikely that these measures could be compared to similar measures presented by other companies.

Forward-Looking Statements

Except for historical information contained herein, the statements in this document are forward-looking. Forward-looking statements involve known and
unknown risks and uncertainties, including those that are described elsewhere in this prospectus. Such risks and uncertainties may cause actual results in future periods to differ materially from forecasted results. Those risks include, among
others, changes in customer demand for products, changes in raw material and equipment costs and availability, seasonal changes in customer demand, pricing actions by competitors and general changes in economic conditions.

Overview

We are the leading operator of dollar
discount stores in Canada with our core markets being Ontario and Québec. As of October 31, 2006, we operated 451 Dollarama stores, including 365 stores located in Ontario and Québec. We believe that we have more than 2.5 times
the number of stores as our next largest competitor in Canada. Our stores offer a varied mix consisting of both consumables and semi-durables, which are sold mainly in individual or multiple units primarily at a price of $1.00. We have a well
diversified supply base, sourcing our merchandise from both domestic and foreign suppliers. All of our stores are company-operated, and nearly all are located in high-traffic areas such as strip malls and shopping centers in metropolitan areas,
mid-sized cities, or small towns.

Our strategy is to grow our sales, net earnings and cash flow by building upon our position as the
leading Canadian operator of dollar stores and continuing to offer a compelling value proposition on a wide variety of everyday merchandise to a broad base of shoppers. As a result, we continually strive to maintain and improve the efficiency of our
operations.

Factors Affecting Our Results of Operations

Sales

We recognize sales at the time the sales are made to the customer. All sales are final.
Our sales consist of comparable store sales and new store sales. Comparable store sales is a measure of the percentage increase or decrease of the sales of stores open for at least 13 complete months relative to the same period in the prior year. To
provide more meaningful results, we measure comparable store sales over periods containing an integral number of weeks beginning on a Monday and ending on a Sunday that best approximate the fiscal period to be analyzed. We include sales from
relocated stores and expanded stores in comparable store sales. The primary drivers of comparable store sales performance are store expansions and relocations, changes in store traffic, and the average number of items purchased by customers per
visit. To increase comparable store sales, we focus on expanding our stores and offering a wide selection of merchandise that offer high quality and good value at attractive and well-maintained updated store formats, in convenient locations.

We have historically experienced seasonal fluctuations in our sales and expect this trend to continue. We generated 30.4% of our sales in
fiscal year ended January 31, 2006 during the fourth quarter due to the Christmas season. In anticipation of increased sales activity during the fourth quarter, we typically purchase substantial amounts of inventory and hire a significant
number of temporary employees to supplement our permanent store and warehouse staffs.



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Our sales are adversely affected by inflation and other adverse economic developments that affect the
level of consumer spending in Canada where we sell our merchandise.

Cost of Sales

Our cost of sales consists of merchandise inventories (which are variable and proportional to our sales volume), and procurement and warehousing costs
(including occupancy and labor costs) and store rent and occupancy costs, which are predominantly fixed costs. We record vendor rebates consisting of volume purchase rebates, when earned. The rebates are recorded as a reduction of inventory
purchases at cost, which has the effect of reducing cost of sales. As a fixed price retailer, increases in operating and merchandise costs could negatively impact our operating results because we generally do not pass on cost increases to our
customers. We have the ability to redesign many of our direct sourced products to mitigate the impact of increasing unit costs.

We have
historically reduced our cost of sales by shifting more of our sourcing from low-cost foreign suppliers. For the three and nine month periods ended October 31, 2006, the direct foreign sourcing as a percentage of sales was 56.1% and 52.0%
respectively, compared to 56.7% and 54.4% respectively for the three and nine month periods ended October 31, 2005. We purchase merchandise from foreign suppliers in countries such as China, Denmark, France, Hong Kong, India, Indonesia, Italy,
Malaysia, Panama, the Philippines, Taiwan, Turkey, and the United States. As a result, our cost of sales is impacted by the fluctuation of foreign currencies against the Canadian dollar. In particular, we purchase a majority of our imported
merchandise from suppliers in China using U.S. dollars. Therefore, our cost of sales is impacted by the fluctuation of the Chinese renminbi against the U.S. dollar and the fluctuation of the U.S. dollar against the Canadian dollar. While we have
entered into forward contracts to hedge our exposure to fluctuations in the value of the U.S. dollar against the Canadian dollar, we do not hedge our exposure to fluctuations in the value of the Chinese renminbi against the U.S. dollar.

Our occupancy costs are driven by our base rent expense. We believe that we are generally able to negotiate leases at market, or slightly favorable to
market, economic terms due to the increased consumer traffic which our stores usually generate in strip malls and shopping centers. We typically enter into leases with terms of between five and ten years with options to renew for one or more periods
of five years each.

Shipping and transportation costs are also a significant component of our cost of sales. When fuel costs increase,
shipping and transportation costs increase because the carriers generally pass on such cost increases to the users. Because of the risk of continued increases in fuel costs in fiscal year 2007, we expect increased fuel surcharges from our contract
carriers as compared with past quarters. Our cost of sales is also affected by general inflation in costs of merchandise and costs of certain commodities relating to raw materials used in our products. To date, our product margins have not been
adversely impacted by these cost increases, due primarily to favorable foreign currency fluctuations, specifically the relative strengthening of the Canadian dollar against the U.S. dollar during the last three fiscal years. We expect to offset a
portion of any future cost increases with improved efficiencies in store and warehousing operations.

General, Administrative and
Store Operating Expenses

Our general, administrative and store operating expenses consist of transportation costs from our
distribution centers to the stores, store labor and maintenance costs such as repair costs, which are primarily fixed, and salaries and related benefits of corporate team members, administrative office expenses, professional expenses and other
related expenses. Although our average hourly wage rate is higher than the minimum wage, an increase in the mandated minimum wage could significantly increase our payroll costs unless we realize offsetting productivity gains and cost reductions. We
expect our administrative costs to increase as we build our back-office infrastructure to effectively meet reporting and other regulatory requirements applicable to a public reporting company. Administrative and general expenses also include
management fees of up to $3.0 million per year plus expenses to be paid pursuant to a management agreement with Bain Capital Partners, LLC.

The
Transactions

The Acquisition

On November 18, 2004, Dollarama Capital Corporation, an entity formed by funds managed by Bain Capital Partners, LLC caused our wholly-owned subsidiary, Dollarama L.P., to purchase substantially all of the assets
of S. Rossy Inc. and Dollar A.M.A. Inc. relating to the Dollarama business, for a total purchase price of $1,032.5 million. We refer to



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this acquisition and the related transactions as the Acquisition. The total purchase price consisted of approximately $951.5 million of cash and $81.0
million of equity securities of our parent issued to the sellers. The cash portion of the purchase price and the transaction expenses were financed primarily by (i) a cash investment by funds managed by Bain Capital Partners, LLC in our parent,
(ii) the borrowing by us of term loans under a new senior secured credit facility, and (iii) the borrowing by us of senior subordinated loans under a new senior subordinated bridge loan facility. The rollover equity investment made by the
sellers, and cash investment made by the funds managed by Bain Capital Partners, LLC in our parent were contributed to us as equity in connection with the asset purchase. Our historical financial data discussed herein for the periods following the
Acquisition reflect the application of purchase accounting rules which required us to allocate the total cost of the acquisition to the assets acquired and the liabilities assumed on the basis of their estimated fair values as of the closing of the
Acquisition.

The Refinancing

On August 12, 2005, Dollarama Group L.P. and Dollarama Corporation issued U.S.$200.0 million aggregate principal amount of 8.875% senior subordinated notes due 2012. The notes bear interest at the rate of
8.875% per year. Interest on the notes is payable on February 15 and August 15 of each year, which began on February 15, 2006. The notes will mature on August 15, 2012.

The gross proceeds from the sale of the senior subordinated notes was U.S.$200.0 million (approximately $224.6 million based on the exchange rate on
October 31, 2006). We used the proceeds from the sale of the senior subordinated notes, together with additional term loan B borrowings to (i) repay the outstanding borrowings under our existing senior subordinated loan facility,
(ii) make a cash distribution to our parent and (iii) pay related fees and expenses. We refer to the sales of the senior subordinated notes and the use of proceeds therefrom as the Refinancing.

Critical Accounting Policies

In preparing our
financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and reported
amounts of revenues and expenses during the period. We evaluate our estimates on an ongoing basis, based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from
these estimates.

Valuation of Merchandise Inventories

The valuation of store merchandise inventories is determined by the retail inventory method valued at the lower of cost (first-in, first-out) or market.
Under the retail inventory method, merchandise inventories are converted to a cost basis by applying an average cost to selling ratio. Merchandise inventories that are at the distribution center or warehouses and inventories that are in-transit from
suppliers, are stated at the lower of cost and market, determined on a weighted-average cost basis. Merchandise inventories include items that have been marked down to managements best estimate of their net realizable value and are included in
cost of sales in the period in which the markdown is determined. We estimate our markdown reserve based on the consideration of a variety of factors, including but not limited to quantities of slow-moving or carryover seasonal merchandise on hand,
historical markdown statistics and future merchandising plans. The accuracy of our estimates can be affected by many factors, some of which are outside of our control, including changes in economic conditions and consumer buying trends.
Historically, we have not experienced significant differences in our estimates of markdowns compared with actual results.

Property
and Equipment

Property and equipment are carried at cost, and any equipment acquired under capital leases is recorded at the
present value of the minimum lease payments. Property and equipment are amortized over the estimated useful lives of the respective assets as follows: (i) on the declining balance method, computer equipment at 30% and vehicles at 30%; and
(ii) on the straight-line method, store and warehouse equipment at 8 to 10 years and leasehold improvements at the base, non-cancelable terms of the respective leases. Property and equipment are reviewed for impairment periodically and whenever
events or changes in circumstances indicate that the carrying value of an asset might not be recoverable.



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Goodwill

Goodwill represents the excess of the purchase price over the fair value of net assets acquired in a business acquisition. Goodwill is not subject to amortization and is tested for impairment annually or more
frequently if events or circumstances indicate that the assets might be impaired. Impairment is identified by comparing the fair value of the reporting unit to which it relates to its carrying value. To the extent a reporting units carrying
amount exceeds its fair value, we measure the amount of impairment in a manner similar to that of a purchase price allocation, and any excess of carrying amount over the implied fair value of goodwill is charged to earnings in the period in which
the impairment is determined. Future events could cause us to conclude that impairment indicators exist and that goodwill associated with our business is impaired. Any resulting impairment would be charged to net earnings.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Factors which we consider could trigger an impairment review include, but are
not limited to, the following: (i) significant negative industry or economic trends; and (ii) current, historical or projected losses that demonstrate continuing losses. Impairment is assessed by comparing the carrying amount of an asset
with the expected future net undiscounted cash flows from its use together with its residual value. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets
exceeds their fair value. The estimates regarding their fair value include assumptions about future conditions relating to our business, as well as the industry. If actual cash flows differ from those projected by management, additional write-offs
may be required.

Operating Leases

We recognize rental expense and inducements received from landlords on a straight-line basis over the base, non-cancelable lease terms. Any difference between the calculated expense and the amounts actually paid is
reflected as deferred lease inducements on our balance sheet. We recognize contingent rental expense when the achievement of the specified sales targets is considered probable. Our estimates are based on individual store sales trends and are
adjusted for actual results.

Financial Instruments

We use foreign exchange forward contracts to manage risks from fluctuations in exchange rates. All forward contracts are used only for risk management
purposes and are designated as hedges of specific anticipated purchases. Upon redesignation or amendment of a foreign exchange forward contract, the ineffective portion of such contracts is recognized immediately in income. We periodically examine
the derivative financial instruments we use to hedge exposure to foreign currency fluctuations to ensure that these instruments are highly effective at reducing or modifying foreign exchange risk associated with the hedged item.

Foreign Currencies

Monetary
assets and liabilities denominated in foreign currencies are translated at year-end exchange rates, while non-monetary assets and liabilities are translated at historic rates. Revenues and expenses are translated at prevailing market rates in the
recognition period. The resulting exchange gains or losses are recorded in the statement of earnings, except for gains or losses on foreign exchange contracts used to hedge anticipated purchases in foreign currencies. Gains and losses on these
contracts are accounted for as a separate component of partners capital in other comprehensive income. Such gains or losses are recorded in income when the inventories are sold.



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Results of Operations

The following table sets forth the major components of our consolidated statements of operations, expressed as a percentage of sales, for the periods indicated:



|                                                    |  |                                   |   |  |                                   |   |  |                                  |   |  |                                  |  
|--------------------------------------------------- |  | --------------------------------- | - |  | --------------------------------- | - |  | -------------------------------- | - |  | -------------------------------- | -
|                                                    |  | Three MonthsEnded October 31,2005 |   |  | Three MonthsEnded October 31,2006 |   |  | Nine MonthsEnded October 31,2005 |   |  | Nine MonthsEnded October 31,2006 |  
|Sales                                               |  | 100.0                             | % |  | 100.0                             | % |  | 100.0                            | % |  | 100.0                            | %
|Cost of sales                                       |  | 66.5                              | % |  | 67.0                              | % |  | 69.1                             | % |  | 67.1                             | %
|General administrative and store operating expenses |  | 16.5                              | % |  | 17.1                              | % |  | 17.2                             | % |  | 17.6                             | %
|Amortization                                        |  | 1.8                               | % |  | 2.0                               | % |  | 1.9                              | % |  | 1.9                              | %
|Amortization of deferred financing costs            |  | 0.5                               | % |  | 0.5                               | % |  | 1.3                              | % |  | 0.5                              | %
|Write-off of deferred financing costs               |  | 3.5                               | % |  | 0.0                               | % |  | 1.3                              | % |  | 0.0                              | %
|Interest expense                                    |  | 6.3                               | % |  | 5.5                               | % |  | 6.6                              | % |  | 5.8                              | %
|Taxes                                               |  | 0.2                               | % |  | 0.2                               | % |  | 0.2                              | % |  | 0.2                              | %
|Net Earnings                                        |  | 3.4                               | % |  | 8.0                               | % |  | 2.0                              | % |  | 7.0                              | %

Three Months Ended October 31, 2006 Compared to Three Months Ended October 31,
2005

Sales

Our
sales increased $31.9 million, or 17.1%, from $186.5 million for the three months ended October 31, 2005, to $218.5 million for the three months ended October 31, 2006. This sales growth was driven primarily by (i) the opening of 69
new stores and offset by the temporary closure of 3 stores for the twelve month period ended October 31, 2006 and (ii) by a comparable store sales increase of 1.6% (for the 13 weeks ended October 29, 2006) for stores in operation
during the three months ended October 30, 2005. Our total store square footage increased 17.7% from 3.5 million at October 31, 2005 to 4.2 million at October 31, 2006.

Cost of Sales

Cost of sales
increased by $22.4 million, or 18.1%, from $124.0 million for the three months ended October 31, 2005 to $146.5 million for the three months ended October 31, 2006. Our margin (sales less cost of sales) decreased from 33.5% for the three
months ended October 31, 2005 to 33.0% for the three months ended October 31, 2006 due to increased occupancy and warehouse costs. The cost of sales for the three months ended October 31, 2005 was reduced by $0.8 million and for the
three months ended October 31, 2006 by $1.0 million as a result of the amortization of unfavorable lease rights, which were fair-valued at the closing of the Acquisition pursuant to the application of purchase accounting rules.

General, Administrative and Store Operating Expenses

General, administrative and store operating expenses increased $6.5 million, or 21.2%, to $37.4 million for the three months ended October 31, 2006 from $30.9 million for the three months ended October 31,
2005. This increase was primarily due to an increase in the number of stores in operation, higher wages resulting from minimum wage increases in Québec, Ontario, New Brunswick, Nova Scotia and Manitoba and new recycling programs introduced in
Québec and Ontario. In addition, the increase in expenses was attributable to costs we incurred to upgrade our disclosure controls and procedures and financial reporting processes to meet public company standards, offset by reduced transition
reserve expenses relating to the Acquisition. These expenses, consisting primarily of non recurring legal and accounting fees



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incurred in connection with the Acquisition, were nil for the three months ended October 31, 2006 and $0.2 million for the three months ended
October 31, 2005. As a percentage of sales, our general, administrative and store operating expenses increased from 16.5% of sales for the three months ended October 31, 2005 to 17.1% for the three months ended October 31, 2006.

Amortization

Amortization expense increased $1.2 million, from $3.3 million for the three months ended October 31, 2005 to $4.5 million for the three months ended October 31, 2006. This increase was due to the amortization of property and
equipment resulting from the new store openings.

Amortization of deferred financing costs

Amortization of deferred financing costs was $1.0 million for both the three months ended October 31, 2005 and October 31, 2006. The
amortization of deferred costs represents the cost of the new financing described in Liquidity and Capital ResourcesDebt and Commitments, which is amortized over the term of the related debt.

Write-off of deferred financing costs

As a result of the issuance of our senior subordinated notes and repayment of the senior subordinated loan that financed the Acquisition, deferred financing costs of $6.6 million were expensed in the three month period ended
October 31, 2005.

Interest Expense

Interest expense increased $0.3 million, from $11.7 million for the three months ended October 31, 2005 to $12.0 million for the three months ended October 31, 2006. This was due mainly to higher interest
costs on floating rate debt, which was partially offset by lower interest costs on the senior subordinated debt that was refinanced in August 2005.

Income Taxes

Income tax expense decreased from $0.5 million for the three months ended October 31, 2005 to $0.4
million for the three months ended October 31, 2006. Net earnings for the three month periods ended October 31, 2005 and October 31, 2006, constitute income of our partners and are therefore subject to income tax in their hands.
Income taxes recorded in such periods represent the large corporations tax and nominal income taxes of our subsidiary companies.

Net Earnings

Net earnings increased $11.1 million, from $6.4 million for the three months ended October 31, 2005, to
$17.4 million for the three months ended October 31, 2006.

Nine Months Ended October 31, 2006 Compared to Nine Months
Ended October 31, 2005

Sales

Our sales increased $94.1 million, or 18.2%, from $517.5 million for the nine months ended October 31, 2005 to $611.6 million for the nine months ended October 31, 2006. This sales growth was driven
primarily by the opening of 69 new stores, offset by the temporary closure of three stores in the twelve month period ended October 31, 2006 and by a comparable store sales increase of 3.3% for the 39 weeks ended October 30, 2006.

Cost of Sales

Cost of
sales increased by $52.8 million, or 14.7%, from $357.8 million for the nine months ended October 31, 2005, to $410.5 million for the nine months ended October 31, 2006. Our margin (sales less cost of sales) increased from 30.9% for the
nine months ended October 31, 2005 to 32.9% for the nine months ended October 31, 2006. Cost of sales included $9.7 million of amortization of the purchase accounting inventory step-up during the nine months ended October 31, 2005.
The cost of sales for the nine months ended October 31, 2005 was reduced by $2.6 million and for the nine



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months ended October 31, 2006 by $2.7 million as a result of the amortization of unfavorable lease rights, which were fair-valued at the closing of the
Acquisition pursuant to the application of purchase accounting rules.

General, Administrative and Store Operating Expenses

General, administrative and store operating expenses increased $18.5 million, or 20.8%, from $88.9 million for the nine months ended
October 31, 2005, to $107.4 million for the nine months ended October 31, 2006. This increase was primarily due to an increase in the number of stores in operation, higher wages resulting from minimum wage increases in Québec,
Ontario, New Brunswick, Nova Scotia and Manitoba and new recycling programs introduced in Québec and Ontario. In addition, the increase in expenses was attributable to costs we incurred to meet Sarbanes-Oxley requirements, offset by reduced
expenses relating to the Acquisition. These expenses, consisting primarily of non recurring legal and accounting fees incurred in connection with the Acquisition were nil for the nine months ended October 31, 2006 and $1.7 million for the nine
months ended October 31, 2005. As a percentage of sales, our general, administrative and store operating expenses increased from 17.2% of sales for the nine months ended October 31, 2005, to 17.6% for the nine months ended October 31,
2006.

Amortization

Amortization expense increased $2.2 million, from $9.7 million for the nine months ended October 31, 2005, to $11.9 million for the nine months ended October 31, 2006. This increase was due to the amortization of property and
equipment resulting from the new store openings.

Amortization of deferred financing costs

Amortization of deferred financing costs decreased from $6.5 million for the nine months ended October 31, 2005, to $3.1 million for the nine months
ended October 31, 2006. The amortization of deferred costs represents the cost of the new financing described in Liquidity and Capital Resources - Debt and Commitments, which is amortized over the term of the related debt.

Write-off of deferred financing costs

As a result of the issuance of our new senior subordinated notes and repayment of the senior subordinated loan that financed the Acquisition, deferred financing costs of $6.6 million were expensed in the nine month
period ended October 31, 2005.

Interest Expense

Interest expense increased $1.2 million from $34.1 million for the nine months ended October 31, 2005, to $35.3 million for the nine months ended October 31, 2006, due mainly to higher interest costs on
floating rate debt, partially offset by lower interest costs on the senior subordinated debt, which was refinanced in August 2005.

Income Taxes

Income tax expense was $1.3 million for both the nine months ended October 31, 2005, and October 31,
2006. Net earnings for the nine month periods ended October 31, 2005, and October 31, 2006, constitute income of our partners and are therefore subject to income tax in their hands. Income taxes recorded in such periods represent the large
corporations tax and nominal income taxes of our subsidiary companies.

Net Earnings

As a result of higher sales, better margins and the absence of a $6.6 million write-off of deferred financing costs which existed in the prior year, net
earnings increased $32.6 million, from $10.2 million for the nine months ended October 31, 2005 to $42.8 million for the nine months ended October 31, 2006.



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Liquidity and Capital Resources

Cash Flows

Our cash position decreased from $30.9 million at January 31, 2006 to $26.9
million at October 31, 2006. The cash flows provided by or used in operating activities, investing activities and financing activities during the three and nine months ended October 31, 2006 and October 31, 2005 are discussed below.

Operating Activities

Cash flows provided by operating activities during the three months ended October 31, 2006 were $4.1 million, compared with cash flows provided by operating activities of $15.7 million for the three months ended October 31, 2005.
Cash flows provided by operating activities during the nine months ended October 31, 2006, were $61.2 million, compared with cash flows provided by operating activities of $0.1 million for the nine months ended October 31, 2005. The
primary drivers of cash flows from operating activities are profitability before non-cash depreciation and amortization expense and cash used for working capital purposes.

Investing Activities

Cash flows used
in investing activities during the three months ended October 31, 2006 were $11.7 million, compared with $7.9 million for the three months ended October 31, 2005. Cash flows used in investing activities during the nine months ended
October 31, 2006 were $29.8 million, compared with $16.5 million for the nine months ended October 31, 2005. Investing activities were mainly impacted by the acquisition of property and equipment related to new stores opened and to improve
information technology systems and warehouse and distribution capacity in the greater Montreal area. On an ongoing basis, we expect the primary driver of cash flows used in investing activities will be capital expenditures associated with opening
new stores.

Financing Activities

Cash flows used in financing activities during the three months ended October 31, 2006, were $22.0 million, compared with $14.1 million used in financing activities for the three months ended October 31,
2005. Cash flows used in financing activities during the nine months ended October 31, 2006 were $32.3 million, compared with $23.6 million used in financing activities for the nine months ended October 31, 2005. The cash used in financing
activities during the nine months ended October 31, 2006, was a result of $28.1million of long-term debt repayments (of which $17.0 million consisted of a prepayment), and $4.2 million of capital distributions, while the cash used in financing
activities during the nine months ended October 31, 2005 was a result of $58.3 million of capital distributions, net proceeds from long-term debt of $47.0 million (net of repayments), $9.8 million of deferred financing costs and $2.5 million
due to company controlled by a minority shareholder.

Debt and Commitments

We are and will continue to be significantly leveraged. Our principal sources of liquidity have been cash flow generated from operations and borrowings
under our senior secured credit facility. Our principal cash requirements have been for working capital, capital expenditures and debt service. In connection with the Acquisition, we entered into the senior secured credit facility, pursuant to which
we incurred $120.0 million of term loan A borrowings and U.S.$201.3 million of term loan B borrowings ($240.0 million based on the exchange rate on the closing date of the Acquisition), and the senior subordinated bridge loan facility, pursuant to
which we borrowed an aggregate of $240.0 million.

On August 12, 2005, we issued U.S.$200.0 million senior subordinated notes bearing
interest at 87/8% per annum payable semi annually and maturing in August 2012. We used the proceeds from the
sale of these senior subordinated notes, together with additional term loan B borrowings of U.S.$45.0 million (approximately $50.5 million based on the exchange rate on October 31, 2006) that we incurred pursuant to an amendment to our senior
secured credit facility to, (i) repay the outstanding borrowings under the senior subordinated bridge loan facility, (ii) make a cash distribution to our parent and (iii) pay related fees and expenses. At that time, the outstanding
borrowings under the senior subordinated bridge loan including the accrued interest were $240.5 million bearing interest at Canadian Bankers Acceptance rate plus 8.25% per annum and would have otherwise matured in May 2006.



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As of October 31, 2006, we and our subsidiaries had approximately $360.1 million of senior secured
debt outstanding, consisting of debt outstanding under our senior credit facility, and U.S.$200.0 million ($224.6 million based on exchange rate on October 31, 2006) of senior subordinated debt outstanding, consisting of the 8.875% senior
subordinated notes.

Our and our subsidiaries ability to make scheduled payments of principal, or to pay the interest or additional
interest, if any, on, or to refinance our indebtedness, or to fund planned capital expenditures will depend on our future performance, which to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory, or
other factors that are beyond our control. Based upon the current level of our operations, we believe that cash flow from operations, together with borrowings available under our senior secured credit facility, will be adequate to meet our future
liquidity needs. Our assumptions with respect to future liquidity needs may not be correct and funds available to us from the sources described above may not be sufficient to enable us to service our indebtedness, including the notes, or cover any
shortfall in funding for any unanticipated expenses.

Senior Secured Credit Facility. Our senior secured credit facility
consists of a (i) $88.0 million term loan A facility maturing in May 2010, denominated in Canadian dollars; (ii) U.S.$242.2 million ($272.1 million based on the exchange rate on October 31, 2006) term loan B facility maturing in
November 2011, denominated in U.S. dollars; and (iii) $75.0 million revolving credit facility, denominated in Canadian dollars, which includes a $25.0 million letter of credit subfacility and a $10.0 million swingline loan subfacility. In
addition, we may, under certain circumstances and subject to receipt of additional commitments from existing lenders or other eligible institutions, request additional term loan tranches or increases to the revolving loan commitments by an aggregate
amount of up to $150.0 million (or the U.S. dollar equivalent thereof).

The interest rates per annum applicable to the loans under our
senior secured credit facility, other than swingline loans, equal an applicable margin percentage plus, at our option, (1) in the case of U.S. dollar denominated loans, (a) a U.S. base rate equal to the greater of (i) the rate of
interest per annum equal to the rate which Royal Bank of Canada establishes at its main office in Toronto from time to time as the reference rate of interest for U.S. dollar loans made in Canada and (ii) the federal funds effective rate
(converted to a rate based on a 365 or 366 day period, as the case may be) plus 1.0% per annum or (b) the rate per annum equal to the rate determined by Royal Bank of Canada to be the offered rate that appears on the page of the Telerate
screen 3750 that displays an average British Bankers Association Interest Settlement Rate for deposits in U.S. dollars for an interest period chosen by us of one, two, three, or six months (or, if available to all applicable lenders, nine or twelve
month periods) and (2) in the case of Canadian dollar denominated loans, a Canadian prime rate equal to the greater of (i) the rate of interest per annum equal to the rate which Royal Bank of Canada establishes at its main office in
Toronto from time to time as the reference rate for Canadian dollar loans made in Canada and (ii) the rate per annum determined as being the arithmetic average of the rates quoted for bankers acceptance for the appropriate interest period
as listed on the applicable Reuters Screen CDOR (Certificate of Deposit Offered Rate) page (plus 0.10% for certain lenders) plus 1.0% per annum.

The applicable margin percentage for Canadian dollar denominated loans is subject to adjustment based upon the level of the total lease-adjusted leverage ratio. Initially, the applicable margins were 1.25% for
Canadian prime rate loans and 2.25% for bankers acceptances. During the three months ended April 30, 2006, the total lease-adjusted leverage ratio level decreased the applicable margin percentage for Canadian dollar denominated loans by
0.25% to 1.00% for Canadian prime rate loans and 2.00% for bankers acceptances, effective May 25, 2006. On the last day of each calendar quarter, we also pay a commitment fee (calculated in arrears) to each revolving credit lender in
respect of any unused commitments under the revolving credit facility, subject to adjustment based upon the level of our total lease-adjusted leverage ratio. Previously, the applicable margin percentage was 2.25% for adjusted LIBOR rate loans and
1.25% for U.S. base rate loans. However, on May 25, 2006, the term B loan was amended. As a result, the margin percentage of 2.25% for adjusted LIBOR rate loans and 1.25% for U.S. base rate loans was decreased by 0.25%. A further 0.25%
reduction will take effect upon reaching a lease-adjusted leverage ratio of less than 4.75:1.

Our senior secured credit facility contains
a number of restrictive covenants that, subject to significant exceptions, limit our ability and the ability of our restricted subsidiaries, to, among other things: make investments and loans; make capital expenditures; incur, assume, or permit to
exist additional indebtedness, guarantees, or liens; engage in mergers, acquisitions, asset sales or sale-leaseback transactions; declare dividends, make payments on, or redeem or repurchase equity interests; alter the nature of the business we
conduct; engage in certain transactions with affiliates; enter into agreements limiting subsidiary distributions; and prepay, redeem, or repurchase certain indebtedness including the notes.

Subject to exceptions, our senior secured credit facility requires mandatory prepayments or offer to prepay (with the failure to do so constituting an
event of default) of the loans in the event of certain asset sales or other asset dispositions,



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issuances of equity securities or debt securities, or if we have annual consolidated excess cash flow. Our senior secured credit facility is guaranteed by
all of our existing and future subsidiaries (other than unrestricted subsidiaries as defined in the senior secured credit facility), and is secured by a first priority security interest in substantially all of our existing and future assets, and a
first priority pledge of our capital stock and the capital stock of those subsidiaries, subject to certain exceptions agreed upon with our lenders and local law requirements.

8.875% Senior Subordinated Notes Due 2012. The 8.875% senior subordinated notes were issued by Dollarama Group L.P. and Dollarama Corporation.
Interest on the senior subordinated notes accrues at 8.875% per year and is payable on the senior subordinated notes semi-annually on February 15 and August 15 of each year, beginning February 15, 2006.

Beginning August 15, 2009, the senior subordinated notes may be redeemed, in whole or in part, initially at 104.438% of their principal amount, plus
accrued and unpaid interest, declining to 100% of their principal amount, plus accrued and unpaid interest, at any time on or after August 15, 2011. Prior to August 15, 2009, the senior subordinated notes may be redeemed, in whole or in
part, at a redemption price equal to 100% of the principal amount, plus accrued and unpaid interest and a make-whole premium. In addition, prior to August 15, 2008, we may redeem up to 35% of the aggregate principal amount of the senior
subordinated notes at a price equal to 108.875% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, using proceeds from the sales of certain kinds of capital stock. Following a change of control, we
will be required to offer to purchase all of the senior subordinated notes at a purchase price of 101% of their principal amount, plus accrued and unpaid interest, if any, to the date of purchase.

The indenture governing the senior subordinated notes contains certain restrictions on us, including restrictions on our ability to incur indebtedness,
pay dividends, make investments, grant liens, sell assets and engage in certain other activities.

The senior subordinated notes constitute
general unsecured obligations and are subordinated in right of payment to all existing or future senior indebtedness. The senior subordinated notes are currently guaranteed by all of our subsidiaries.

Capital Expenditures

Capital
expenditures for the three months ended October 31, 2006 were $12.6 million and $6.5 million for the three months ended October 31, 2005, of which $2.5 million is directly attributable to improving information technology systems and
warehouse and distribution capacity in the greater Montreal area. As of June 15, 2006, we moved our distribution center in Montreal to a new rented facility of 292,623 square feet. Capital expenditures for the nine months ended October 31,
2006 were $32.6 million and $15.2 million for the nine months ended October 31, 2005, of which $7.1 million is directly attributable to information technology systems and warehouse and distribution capacity in the greater Montreal area. The
increased capital expenditures for the three and nine month periods ended October 31, 2006, were primarily related to new store openings and the aforementioned distribution center and information technology system enhancements. We expect to
make additional expenditures over the next quarters to improve our information technology systems, to increase our warehouse capacity and relocate our head office in the greater Montreal area, and to add new warehouse and distribution infrastructure
to facilitate our geographic expansion to western Canada.

We plan to open approximately 60 new stores in fiscal year 2007. In fiscal year
ended January 31, 2006, the average cost to open a new store was approximately $0.5 million, including $0.3 million for capital expenditures and $0.2 million for inventory.

Off-Balance Sheet Obligations

We have no off-balance sheet obligations.

Recent Accounting Pronouncements

On April 1,
2005, the Canadian Institute of Chartered Accountants (CICA) issued three new Handbook sections: Section 1530 Comprehensive Income, Section 3855 Financial InstrumentsRecognition and Measurement,
and Section 3865 Hedges. These new sections apply to fiscal years beginning on or after October 1, 2006, with earlier adoption permitted as of the beginning of a fiscal year ending on or after December 31, 2004.

Section 3855, Financial InstrumentsRecognition and Measurement, requires all financial instruments to be classified
as either Held to Maturity, Loans and Receivables, Held for Trading, or Available for Sale. The Held to Maturity Classification



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is restricted to fixed maturity instruments that the company intends and is able to hold to maturity. Loans and Receivables and Held to Maturity investments
are accounted for at amortized cost. Securities that are acquired for selling in the near term are classified as Held for Trading and are accounted for at fair value with realized and unrealized gains and losses reported in net income. The remaining
financial instruments are classified as Available for Sale and are measured at fair value with unrealized gains and losses, not affecting income, but reported in a new category in shareholders capital called Other Comprehensive Income.

Section 3865, Hedges, which replaces AcG-13 Hedging Relationships, establishes standards for when and how
hedge accounting may be applied. Consistent with Section 3855, it requires that all derivatives, including hedges, be measured at fair value. Changes in the fair value of a derivative which hedges the companys exposure that the fair value
of an asset or liability will change due to a particular risk are recognized in the net income together with those of the respective offsetting hedge item. However, changes in the fair value of a derivative which hedges the companys exposure
to changing cash flows are accumulated in other comprehensive income until the transaction being hedged affects net income.

Section 1530, Other Comprehensive Income, a new category in the shareholders capital section of the balance sheet, includes unrealized foreign currency translation gains and losses on cash flow hedges mentioned above.

Dollarama Group L.P. elected to early adopt the recommendations of Sections 1530, 3855 and 3865 on a prospective basis as of the beginning of the
period from November 18, 2004 to January 31, 2005.

The CICA has reissued Section 3830 of the CICA Handbook as
Section 3831, Non-Monetary Transactions, which establishes standards for the measurement and disclosure of non-monetary transactions. It also includes criteria for defining commercial substance which replace the criteria for
defining culmination of the earnings process in the former section. These changes come into effect for fiscal years beginning on or after January 1, 2006. We do not anticipate that the adoption of this section will have a material
impact on our financial statements.

On July 6, 2006, the CICA issued Emerging Issue Committee Abstract of Issue Discussed #162
Stock-Based Compensation for Employees Eligible to Retire Before the Vesting Date (EIC-162). EIC-162 requires that compensation costs attributable to employees eligible to retire during the vesting period be recognized over
the period from the grant date to the date the employee becomes eligible to retire. As none of the optionholders are eligible to retire prior to the end of the vesting periods, we do not anticipate the adoption of EIC-162 will have an impact on our
financial statements.

In July 2006, the CICA released Section 1506, Accounting Changes which replaces the former
Section 1506 and applies to fiscal years beginning on or after January 1, 2007. The new Section allows for voluntary changes of accounting policy only if they result in the financial statements providing reliable and more relevant
information. The Section also requires that changes in accounting policies be applied retrospectively unless doing so is impracticable and provides additional disclosures. The adoption of this pronouncement would impact our financial statement to
the extent that a change in an accounting policy would be considered beginning in the quarter ended April 30, 2007. No such changes are contemplated at this time.



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|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|------- | ----------------------------------------------------------

Foreign Exchange Risk

While principally all of our sales have been in Canadian dollars, we have been steadily
increasing our purchases of merchandise from low-cost foreign suppliers, including suppliers in China, Denmark, France, Hong Kong, India, Indonesia, Italy, Malaysia, Panama, the Philippines, Taiwan, Turkey, and the United States. For the three and
nine month periods ended October 31, 2006, this direct sourcing from foreign suppliers accounted for in excess of 50% of our sales. Accordingly, our results of operations are impacted by the fluctuation of foreign currencies against the
Canadian dollar. In particular, we purchase a majority of our imported merchandise from suppliers in China using U.S. dollars. Therefore, our cost of sales is impacted by the fluctuation of the Chinese renminbi against the U.S. dollar and the
fluctuation of the U.S. dollar against the Canadian dollar.

We use foreign exchange forward contracts to manage risks from fluctuations in
exchange rates. All forward contracts are used only for risk management purposes and are designated as hedges of specific anticipated purchases of merchandise. Upon redesignation or amendment of a foreign exchange forward contract, the ineffective
portion of such contracts is recognized immediately in earnings. We estimate that in the absence of our currency risk management program, every $0.01 appreciation in the Canadian dollar relative to U.S. dollar exchange rate results in approximately
$1.0 million annual increase in operating earnings. The seasonality of our purchases will affect the quarterly impact of this variation. We periodically examine the derivative financial instruments we use to hedge exposure to foreign currency
fluctuation to ensure that these instruments are highly effective at reducing or modifying foreign exchange risk associated with the hedged item.

In addition, a majority of our debt is in U.S. dollars. Therefore, a downward fluctuation in the exchange rate of the Canadian dollar versus the U.S. dollar would reduce our funds available to service our U.S. dollar-denominated debt. As
required by the terms of our senior secured credit facility, we have entered into two swap agreements consisting of a foreign currency swap and an interest rate swap that expire on January 31, 2011 to minimize our exposure to exchange rate and
interest rate fluctuations in respect of our LIBOR-based U.S. dollar-denominated term loans. We record the fair value of the swap agreements as a reduction of foreign exchange loss on long-term debt and change in fair value of derivative
financial instruments  in our consolidated statement of operations and in derivative financial instruments on the balance sheet.

On August 12, 2005, we entered into two additional swap agreements consisting of foreign currency swaps to minimize our exposure to exchange rate fluctuations in respect of our senior subordinated notes. These swap agreements qualify
for hedge accounting. The fair value of the swap agreements is deferred in a separate component in our consolidated statement of Partners capital and other comprehensive income until the underlying hedged transactions are reporting in our
consolidated statement of earnings.

Interest Rate Risk

We use variable-rate debt to finance certain of our operations and capital expenditures. These obligations expose us to variability in interest payments
due to changes in interest rates. We have approximately $360.1 million in term loans outstanding under our senior secured credit facility based on the exchange rate on October 31, 2006, bearing interest at variable rates. Each quarter point
change in interest rates would result in a $0.9 million change in interest expense on such term loans. We also have a revolving loan facility which provides for borrowings of up to $75.0 million which bears interest at variable rates. Assuming the
entire revolver is drawn, each quarter point change in interest rates would result in a $0.2 million change in interest expense on our new revolving loan facility. We have entered into a contract maturing on January 31, 2007 that will eliminate
our exposure to interest due on the notional amount of $120 million in excess of the Canadian Bankers Acceptance rate cap of 4.5%.



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|ITEM 4. | CONTROLS AND PROCEDURES
|------- | -----------------------

An evaluation was carried
out under the supervision and with the participation of our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of our disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the Exchange Act)) as of the end of the fiscal quarter covered by this report. Based upon that evaluation, our CEO and CFO have concluded that our disclosure
controls and procedures are effective. There has been no change in our internal control over financial reporting during the quarter ended October 31, 2006 that has materially affected, or is reasonably likely to materially affect, internal
control over financial reporting.



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PART II  OTHER INFORMATION



|ITEM 1. | LEGAL PROCEEDINGS
|------- | -----------------

We are from time to time
involved in legal proceedings of a nature considered normal to our business. We believe that none of the litigation in which we are currently involved, individually or in the aggregate, is material to our consolidated financial condition or results
of operations. We note, however, that two actions have been instituted against us for alleged copyright infringement pertaining to the sale of certain products. We have denied these claims, and believe these claims are without merit. We further note
that actions have been instituted against us for alleged personal injuries sustained by customers in our stores. In one case, filed on June 17, 2004 in the Ontario Superior Court of Justice, the plaintiffs are alleging damages of $4.4 million
and in another case filed on May 8, 2006 in the Ontario Superior Court of Justice, the plaintiffs are alleging damages of $1.0 million. We believe that our insurance policies will cover any potential amount to be paid for these claims other
than punitive damages. While we intend to vigorously defend the claims asserted against us, we cannot predict the outcome of these claims.



|ITEM 1A. | RISK FACTORS
|-------- | ------------

The information called for by this item is set forth
under the heading Risk Factors in the Companys 424B3 Prospectus filed with the Securities and Exchange Commission on August 7, 2006.



|ITEM 6. | EXHIBITS
|------- | --------



|               |  |                                                                                           
|-------------- |  | ------------------------------------------------------------------------------------------
|Exhibit Number |  | Description                                                                               
|31.1           |  | Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer, furnished herewith.
|               | 
|31.2           |  | Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer, furnished herewith.
|               | 
|32.1           |  | Section 1350 Certifications, furnished herewith.                                          



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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.



|                        |  |  |  |                                                  |  |                 |  |                                                 
|----------------------- |  |  |  | ------------------------------------------------ |  | --------------- |  | ------------------------------------------------
|                        |  |  |  | Dollarama Group L.P.                            
|                        |  | 
|                        |  |  |  | By: Dollarama Group GP Inc., its general
partner
|                        |  |  | 
|Dated: December 8, 2006 |  |  |  | By:                                              |  | /s/ LARRY ROSSY
|                        |  |  |  |                                                  |  |                 |  | Name: Larry Rossy Title: Chief Executive
Officer



|                        |  |  |  |     |  |                     |  |                                                     
|----------------------- |  |  |  | --- |  | ------------------- |  | ----------------------------------------------------
|                        |  |  |  |    
|                        |  |  | 
|Dated: December 8, 2006 |  |  |  | By: |  | /s/ ROBERT COALLIER
|                        |  |  |  |     |  |                     |  | Name: Robert Coallier Title: Chief Financial
Officer



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