Welcome to the Annual General Meeting of Aritzia Inc. Please note the meeting will be recorded. I would like to introduce Beth Reed, VP of Investor Relations of the company. Ms. Reed, the floor is yours.
Good afternoon, everyone. Thank you for joining Aritzia's virtual Annual General Meeting of shareholders. To facilitate increased shareholder attendance and participation, the meeting will be conducted in a virtual-only format that is being streamed via live webcast. Our agenda today includes the formal business of the meeting that will be conducted by John Currie, our Lead Director, followed by remarks from Jennifer Wong, our CEO. We will conclude with a question-and-answer period open to registered shareholders and duly appointed proxy holders, at which time Jennifer Wong, Brian Hill, our founder and Executive Chair, and Todd Ingledew, our CFO, will be available to respond to questions. Please note that our remarks and responses to questions today may include our expectations, future plans, and intentions that may constitute forward-looking statements. Actual results could differ materially from the conclusions, forecasts, or projections in the forward-looking information.
Certain material factors and assumptions were applied in drawing the conclusions and making the forecasts and projections as reflected in the forward-looking information. We would refer you to our most recently filed Management's Discussion and Analysis and Annual Information Form, which include additional information about the material risks that could cause actual results to differ materially from the conclusions, forecasts, and projections in the forward-looking information and the material factors and assumptions used to develop the forward-looking information. Our Management's Discussion and Analysis and Annual Information Form are available on SEDAR+ and on the Investor Relations section of the Aritzia website. With that, I would like to turn the meeting over to John Currie to lead us through the formal business of the meeting.
Thanks, Beth, and good afternoon. T hank you for coming to Aritzia's virtual Annual General Meeting of shareholders. I've been appointed by the board of directors to be the chair for today's meeting. During the meeting, please note that only registered shareholders or their duly appointed proxy holders, including beneficial shareholders who have appointed themselves as proxy, are permitted to vote or otherwise participate and ask questions during the meeting. As this meeting is being held virtually via live audio and slideshow webcast, we would like to clarify a few procedural matters relating to the conduct of the meeting. Questions in respect of a motion can be submitted by a registered shareholder or duly appointed proxy holder using the question platform service on TSX Trust.
When asking a question, please indicate your name, which entity you represent, if any, and confirm that you are a registered shareholder or a duly appointed proxy holder. Proper questions that do not relate specifically to the business of the meeting will be addressed during the question period at the end of the meeting. Questions relating to the procedural matters or directly related to the motions before the meeting will be addressed during the meeting prior to the closing of the polls. Voting will be open at the beginning of the meeting and will be conducted by electronic ballots. Only registered shareholders and duly appointed proxy holders of Aritzia are permitted to vote and will be able to vote throughout the formal part of the meeting. I will give a 15-second warning before I announce that balloting is closed.
The electronic ballots will be open for all resolutions at the same time. This will allow you to vote on each resolution immediately or throughout the meeting. If you have already voted by proxy, you do not need to vote again during the meeting as your vote has been recorded and will be counted by the scrutineer. Registered shareholders who have already submitted a valid proxy and want to vote again by electronic ballot at the meeting will be revoking any previously submitted proxies, and only the electronic ballot submitted today at the meeting will be counted. If we encounter any technical difficulties, please remain logged on, and we will resume as soon as possible. We will now proceed with the formal portion of the meeting.
Before we begin with the formal business of the meeting, I want to take this opportunity to express, on behalf of the board of directors, my sincere thanks to Aldo Bensadoun, John Montalbano, and Daniel Habashi for their valuable contributions to our board over the last several years. We're excited that Doug Mack has joined the board this past May and look forward to welcoming Nick Drake to the board upon his election. I now call to order the Annual General Meeting of Aritzia's shareholders. With the consent of the meeting, I appoint Ada San, Legal and Corporate Secretary of the company, to act as Secretary of the meeting. In addition, and with the consent of the meeting, I appoint TSX Trust Company through its representatives as scrutineer.
The scrutineer will report on the number of subordinate voting shares and multiple voting shares represented in person and by proxy at this meeting, tabulate the votes, and report the results. The purposes of today's meeting are set out in detail in the Management Information Circular dated May 26th, 2025. Copies of the circular were made available to shareholders on or around June 5, 2025, together with the notice of the meeting, the form of proxy, and the voting instruction form as applicable. Accordingly, unless there is any objection, I will dispense with the reading of the notice of the meeting. I've received a declaration prepared by our transfer agent, TSX Trust Company, indicating that either a notice of this meeting and the accompanying proxy materials or the notice and access notice, as applicable, was duly mailed to shareholders of record as of the record date, May 15th, 2025.
I directed a copy of the notices and circular and the declaration of mailing be kept by the secretary with the records of the meeting. The scrutineer's report indicates that shareholders holding in the aggregate more than 15% of the voting rights attached to shares entitled to be voted at the meeting are present in person or represented by proxy. As this meets the quorum requirements in the company's articles, we may proceed with the meeting. A copy of the final report on attendance will be filed with the records of the meeting. For the purposes of the meeting today, voting on all matters will be conducted by electronic ballots. Voting will be open at the beginning of the meeting and available throughout the formal part of the meeting for all registered shareholders and duly appointed proxy holders.
You'll receive a message on your screen when the online ballots are available. I will announce when voting will close, which will be approximately 15 seconds after the conclusion of the formal items of business of the meeting. Under the company's articles, the chair of the meeting can propose motions, and no motion proposed at a meeting of shareholders is required to be seconded. In order to expedite the meeting, I will propose certain motions and will not call for a seconder. I now declare that the meeting was properly called and duly constituted for the transaction of business. I now declare the polls open on all resolutions. If you're a registered shareholder or duly appointed proxy holder, the electronic ballots will now be available on your screen.
Please register your votes by pressing on the for or withhold buttons next to the name of each proposed director and next to the resolution with respect to the appointment of PricewaterhouseCoopers LLP as the auditors of the company and authorizing the directors to fix their remuneration. You'll have time to vote throughout the formal part of the meeting. The first item of business is the receipt of the company's consolidated financial statements for the fiscal year ended March 2nd, 2025, as well as the auditor's report thereof. These financial statements and the auditor's report were made available on SEDAR+ under the company's profile and on the company's website on May 1st, 2025. The financial statements were also made available on the TSX Trust site on June 5th, 2025, as required for notice and access. Noting no objection, I will dispense with the reading of the auditor's report.
We will respond to any proper questions with respect to the company's consolidated financial statements in the question period following the formal part of the meeting. We'll now move to the next item on today's agenda. The next matter to be acted upon is the election of nine individuals to the board of directors. The term of office of the directors is from today until the end of the next annual meeting of shareholders or until such time as their successors have been duly elected or appointed. As described in the circular, the company has adopted a majority voting policy pursuant to which any director nominee who receives more votes withheld than for must submit their resignation promptly, and such resignation must be accepted by the board other than in exceptional circumstances. The circular contains information on each of the nine nominees recommended for election as director.
As outlined in the circular, the following director nominees have each been nominated to hold office until the close of the next annual meeting of the shareholders or until their successors are duly elected or appointed. They are Brian Hill, Jennifer Wong, John Currie, Nick Drake, David Labistour, Doug Mack, Marni Payne , Glen Senk, and Marcia Smith. The persons nominated have confirmed that they are each prepared to serve as a director. Each of them is qualified as a director under the provisions of the British Columbia Business Corporations Act. Given that no nominations were received in accordance with the advance notice provisions contained in the company's article, I declare the nominations to be closed. I move to nominate the directors as set forth in the circular.
If there's no discussion, as discussed at the beginning of this meeting, voting today will be conducted by electronic ballots, and the polls are currently open so you can vote on the election of each director as you see fit. We'll now move on to the next item of business. The next item of business is the appointment of the auditors of the company who will serve until the end of the next annual meeting of shareholders and to authorize the directors of the company to fix the remuneration of the auditors. The board, on the recommendation of the audit committee, has approved, subject to shareholder approval, the appointment of PricewaterhouseCoopers LLP as the auditors of the company. I move that PricewaterhouseCoopers LLP be appointed auditors of the company until the end of the next annual meeting of shareholders and that the directors be authorized to fix their remuneration.
As there's no discussion and the polls are currently open, you may vote on the appointment of auditors as you see fit. If you have not voted already, please do so now. After 15 seconds, the voting page will disappear and your electronic ballot will automatically be submitted. The time is now
3:13.
3:13, and the ballots will close on all resolutions in 15 seconds. Voting is now closed. I would now like to ask that the scrutineers compile the report regarding the results of voting on all business matters. While the scrutineers are completing the report, I'll ask whether there is any other formal business to be brought before the meeting. As there is no other business to be brought before the meeting and I have received the scrutineer's report, I declare the following.
Each of the nine nominees have been elected as directors of the company to serve until the end of the next annual meeting of shareholders or until their successors are elected or appointed. PricewaterhouseCoopers LLP is hereby appointed as auditor of the company for a term ending at the end of the next annual meeting of shareholders, and the board of directors is authorized to fix their remuneration. Final voting numbers will be posted on SEDAR+. As there is no further business to be brought before the meeting, I declare the formal portion of this meeting closed. I would like to turn over the floor now to Jennifer Wong, our CEO, to provide a few remarks before we move on to the question and answer period. Jen?
Thanks, John, and good afternoon, everyone.
In fiscal 2025, we drove a 19% increase in net revenue, excluding the 53rd week of fiscal 2024. This resulted in a strong five-year compound annual growth rate of 23%. The progress we made to deliver CAD 2.74 billion in net revenue is tangible. Our results were fueled by our evolving assortment of beautiful, high-quality products, our optimized inventory position, our successful real estate expansion strategy, and our rapidly accelerating digital channel. We also continue to offer exceptional service to our clients. We made substantial progress in these five key areas. We optimized the composition and quality of our inventory position. This fueled an acceleration in comparable sales growth in each quarter of the fiscal year. We increased investment in digital and brand marketing to help protect and propel the Aritzia brand and grow awareness. We opened 12 new boutiques and repositioned three existing boutiques.
This included three iconic brand-propelling flagship locations, two in Manhattan and one in Chicago. We launched an improved aritzia.com, which features an enhanced client experience and allows for the seamless integration of a customer mobile app. We delivered a 550 basis point improvement in adjusted EBITDA as a percentage of net revenue. This was driven by IMU improvement, lower markdowns, lower warehousing costs, and savings from the company's Smart Spending initiative. Our world-class team executed at a very high level across the board. I'm extremely grateful to our people for their perseverance and commitment to excellence as we continue to build on the momentum we generated this year. Our sales growth in fiscal 2025 was driven by accelerated momentum in e-commerce, our geographic expansion strategy, and mid-single-digit comparable sales growth in our existing boutiques. Total comparable sales grew 11%. We continue to expand our portfolio of boutiques in premier locations.
Our retail net revenue grew to CAD 1.79 billion, which is a 17% increase from last year, excluding the 53rd week. Across e-commerce, our performance was driven by robust demand for our products, our improved inventory position, and our focus on full-funnel marketing. In fiscal 2025, our e-commerce net revenue grew to CAD 951 million, increasing 23% year- over- year, excluding the 53rd week. This resulted in a five-year e-commerce net revenue compound annual growth rate of 33%. Throughout fiscal 2025, our increased investment in the United States continued to yield impressive results. We opened more boutiques than ever in a single year. Our inline boutiques continued to perform better than our payback expectations of 12 months-18 months. Net revenue in our United States business grew to CAD 1.58 billion, which is an increase of 31% from last year, excluding the 53rd week.
The United States generated 58% of our total net revenue, and we continue to have a tremendous opportunity for growth ahead of us. We completed the upgrade of the technology underpinning our e-commerce platform. This enables us to deliver best-in-class experiences to both our new and loyal clients. We also began to invest more meaningfully in digital performance marketing to help amplify our product franchises, grow awareness, and drive customer engagement. Further, we launched our new and improved aritzia.com, which features an elevated client experience, including greater personalization and enhanced product discovery. Our robust social media and influencer strategies continue to help drive increased brand awareness. Our active client base in the United States has increased fivefold since fiscal 2020 as we deliver Everyday L uxury to more people than ever before. As Aritzia continues to grow, so does our potential to make an impact and create lasting change.
At Aritzia, impact refers to the contributions we make to people and the planet. We believe these contributions matter to our customers and to our overall business resilience. The impact scope spans Aritzia's full value chain, from raw material sourcing in our upstream operations through to product end-of-life in our downstream operations. With the goal of strengthening our positive impact, we share initiatives and oversight of these areas throughout our organization. We seek to take an evidence-based approach and deliver long-term positive impact for the benefit of our stakeholders and our business resilience. This year, we remain committed to excellence as we build on our momentum, diligently managing our business for both the near and long term. We have a healthy balance sheet, and we're well-positioned to navigate the rapidly evolving landscape while remaining steadfast in advancing our key growth levers.
We have a robust pipeline of boutiques opening in fiscal 2026, with a focus on increasing our presence in existing and broadening our reach across the United States. New markets for us this year include Scottsdale, Arizona, Raleigh, North Carolina, Cincinnati, Ohio, Pittsburgh, Pennsylvania, and Salt Lake City, Utah. Our total square footage growth is expected to be in the mid to high teens, with the vast majority occurring in the United States. We expect these boutique openings to propel retail sales growth and drive incremental e-commerce sales. In e-commerce, we have initiatives underway to support our ongoing momentum in the years ahead, such as our enhanced international website and a mobile app. Additionally, our strategic focus on digital marketing will help support further growth in our digital business. As I reflect on fiscal 2025, I recognize that we have so much to be proud of.
We had an excellent year with impressive financial performance. The strength of our brand, the quality of our assortment, and our Everyday Luxury customer experience are all resonating exceptionally well with our clients. This gives us confidence in our ability to capitalize on the opportunities that lie ahead. Thank you to our shareholders for your continued support and your trust in our business plan. I have great confidence in our world-class team, and I'm grateful for the perseverance and hard work our team has put in to generate this momentum that we've experienced. As we propel the business forward, we remain focused on our fundamentals, our solid foundation, and our resourcefulness. Thank you.
Thank you, Jennifer. We'll now move on to the question-and-answer portion of the meeting.
As mentioned at the beginning of the meeting, when asking your question on the question feature of the virtual meeting platform, please indicate your name, the entity you represent, if any, and confirm you are a registered shareholder or a duly appointed proxy holder. Please keep your questions short and succinct. We may consolidate questions that are repetitive or overlap in the interests of all those logged on today. We will not address any questions or statements that are, among other things, irrelevant to the business and affairs of the company, related to material non-public information of the company, related to personal grievances, derogatory, or otherwise in bad taste, repetitive of questions or statements already made by another participant, or out of order or not otherwise suitable for the conduct of the business as determined by the chair.
We will now give registered shareholders and duly appointed proxy holders, including beneficial shareholders who have appointed themselves as proxy, a brief moment to type in their questions if you have not already done so. There being no questions, we are now concluding the question-and-answer portion of the meeting. Thank you all again for joining us. Enjoy the rest of your day.
Thank you for attending today's meeting. You may now.