~ Sales Increased 134% to $5.09 Billion and
Same-Store Sales Increased 2.3% ~
~ Diluted Earnings per Share Increased 188%
to $0.98 ~
~ Excluding One-Time Tax Benefit, Diluted
EPS Increased to $0.89 ~
Dollar Tree, Inc. (NASDAQ: DLTR), North America's leading
operator of discount variety stores, today reported results for its
first fiscal quarter ended April 30, 2016.
First Quarter Results
Consolidated net sales increased 133.6% to $5.09 billion from
$2.18 billion in the prior year’s first quarter. The $2.91 billion
increase included $2.70 billion in sales from Family Dollar stores,
sales from new Dollar Tree stores, and a 2.3% same-store sales
increase, on a constant currency basis. Same-store sales, on a
constant currency basis, increased 3.4% in the prior-year period.
Adjusted for the impact of Canadian currency fluctuations, the
same-store sales increase was 2.2%. The positive same-store sales
were driven by increases in both customer transactions and average
ticket.
Gross profit increased 107.6%, to $1.55 billion in the first
quarter compared to $748.9 million in the prior year’s first
quarter. The $805.7 million increase included $733.8 million of
gross profit for Family Dollar, and a 9.6% increase in Dollar
Tree’s gross profit for the quarter. As a percent of sales, gross
margin decreased to 30.6% compared to 34.4% in the prior year. The
primary contributors to the decrease were the impact of the overall
lower-margin product mix for the Family Dollar business and $6.3
million for Family Dollar related to the amortization of the
stepped up inventory basis. Gross margin for the Dollar Tree
segment was flat at 34.4% when compared to the prior year’s
quarter.
Selling, general and administrative expenses were 22.3% of sales
compared to 23.7% of sales in the prior year's first quarter.
Excluding $10.4 million in acquisition costs from the prior year’s
period, selling, general and administrative expenses, as a percent
of sales, decreased to 22.3% from 23.2%. This 90 basis point
improvement resulted from lower payroll, operating and corporate
expenses, as a percent of sales, partially offset by higher store
repair and maintenance expenses and depreciation.
Operating income increased 79.9% to $418.7 million compared with
$232.8 million in the same period last year. This increase is the
result of $138.0 million of operating income in the Family Dollar
segment and a $47.9 million increase in operating income in the
Dollar Tree segment.
The Company’s effective tax rate for the quarter was 29.8%
compared to 38.6% in the prior year period. The lower effective tax
rate was primarily attributable to a one-time benefit related to
state tax planning, which contributed $0.09 to earnings per
share.
Net income compared to the prior year’s first quarter increased
$163.2 million to $232.7 million, and diluted earnings per share
increased by 188.2% to $0.98. Excluding the one-time tax benefit,
diluted earnings per share for the quarter increased to $0.89.
Excluding the current quarter one-time tax benefit and
acquisition-related costs from the prior year quarter, diluted
earnings per share increased 25.4%, to $0.89 from $0.71.
Bob Sasser, Chief Executive Officer, stated, “I am very pleased
with the Company’s performance in the first quarter. Through what
continues to be a challenging economic environment, we delivered
sales of $5.09 billion, which was the mid-point of our guidance
range, and earnings that exceeded the high end of our guidance
range. Additionally, while not included in our comp calculation,
our Family Dollar segment delivered its third consecutive quarter
of positive same-store sales.”
Sasser added, “We have gotten off to a successful start to 2016.
We continue to serve a loyal customer base by providing terrific
values every day; we remain on schedule with our integration of
Family Dollar; we are on track to achieve our stated synergy
targets; and we are part of what I consider, in this economic
environment, the most attractive sector in retail. Looking ahead,
we are committed to growing and improving our Dollar Tree and
Family Dollar businesses to better serve more customers, while
delivering long-term value to our shareholders.”
During the quarter, the Company opened 171 stores, expanded or
relocated 66 stores, and closed 19 stores. Additionally, as part of
its re-banner initiative, the Company opened three former Family
Dollar store locations as new Dollar Tree stores. The Company also
converted 126 Deals stores to Dollar Tree stores and converted nine
Deals stores to Family Dollar stores. Retail selling square footage
at the end of the quarter was approximately 109.6 million square
feet.
Company Outlook
The Company estimates consolidated net sales for the second
quarter of 2016 to range from $5.03 billion to $5.12 billion, based
on a low single-digit increase in same-store sales and
year-over-year selling square footage growth of 2.4%. Diluted
earnings per share are expected to range from $0.66 to $0.72.
Consolidated net sales for full-year 2016 are now expected to
range between $20.79 billion and $21.08 billion compared to the
Company’s previously expected range of $20.76 billion to $21.11
billion. This estimate is based on a low single-digit increase in
same-store sales, and 4.0% square footage growth. The Company now
anticipates net income per diluted share for full-year 2016 will
range between $3.58 and $3.80. This compares to its previous EPS
guidance range of $3.35 to $3.65.
Conference Call
Information
On Thursday, May 26, 2016, the Company will host a conference
call to discuss its earnings results at 9:00 a.m. Eastern Time. The
telephone number for the call is 888-820-9418. A recorded version
of the call will be available until midnight Wednesday, June 1,
2016 and may be accessed by dialing 888-203-1112. The passcode is
4775937. A webcast of the call is accessible through Dollar Tree's
website, and will remain online until Wednesday, June 1, 2016.
Dollar Tree, a Fortune 500 Company, operated 13,997 stores
across 48 states and five Canadian provinces as of April 30, 2016.
Stores operate under the brands of Dollar Tree, Family Dollar, and
Dollar Tree Canada. To learn more about the Company, visit
www.DollarTree.com.
A WARNING ABOUT FORWARD-LOOKING STATEMENTS: Our press release
contains "forward-looking statements" as that term is used in the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements address future events, developments or results and
typically use words such as believe, anticipate, expect, intend,
plan, forecast, or estimate. For example, our forward-looking
statements include statements regarding second quarter 2016 and
full-year 2016 net sales and same-store sales, second quarter 2016
and full-year 2016 diluted earnings per share, square footage
growth, the benefits, results, and effects of the merger including
synergies, future financial and operating results and shareholder
value, the combined company's plans, objectives, expectations
(financial or otherwise) and intentions. For a discussion of the
risks, uncertainties and assumptions that could affect our future
events, developments or results, you should carefully review the
“Risk Factors,” "Business" and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” sections
in our Annual Report on Form 10-K filed March 28, 2016 and other
filings with the Securities and Exchange Commission. We are not
obligated to release publicly any revisions to any forward- looking
statements contained in this press release to reflect events or
circumstances occurring after the date of this report and you
should not expect us to do so.
DOLLAR TREE, INC. Condensed Consolidated Income
Statements (In millions, except per share data)
13 Weeks Ended
April 30, 2016
May 2, 2015
(Unaudited) (Unaudited)
AsReported
AsReported
Adjustments(a)
AsAdjusted
Net sales $ 5,085.8 $ 2,176.7 $ - $ 2,176.7 Cost of
sales 3,531.2 1,427.8 - 1,427.8 Gross profit 1,554.6 748.9 -
748.9 30.6 % 34.4 % 34.4 % Selling, general &
administrative expenses 1,135.9 516.1 (10.4 ) 505.7 22.3 % 23.7 %
(0.5 %) 23.2 % Operating income 418.7 232.8 10.4 243.2 8.2 %
10.7 % 0.5 % 11.2 % Interest expense, net 87.3 122.2 (114.0
) 8.2 Other income, net (0.2 ) (2.6 ) - (2.6 ) Income before
income taxes 331.6 113.2 124.4 237.6 6.5 % 5.2 % 5.7 % 10.9 %
Income tax expense 98.9 43.7 47.6 91.3 Income tax rate 29.8
% 38.6 % 38.3 % 38.4 % Net income $ 232.7 $ 69.5 $ 76.8 $
146.3 4.6 % 3.2 % 3.5 % 6.7 % Net earnings per share: Basic
$ 0.99 $ 0.34 $ 0.37 $ 0.71 Weighted average number of shares 235.3
206.2 206.2 206.2 Diluted $ 0.98 $ 0.34 $ 0.37 $ 0.71
Weighted average number of shares 236.4 207.1 207.1 207.1
(a) The adjustments to selling, general and administrative expenses
and interest expense, net are related to the acquisition of Family
Dollar Stores, Inc. NOTE: These condensed consolidated
income statements have been prepared on a basis consistent with our
previously prepared income statements filed with the Securities and
Exchange Commission for our prior quarter and annual periods, with
the exception of the footnotes required by GAAP for complete
financial statements and inclusion of certain non-GAAP adjustments
and measures as described in footnote (a) above. Management
believes the reporting of comparable results is important in
assessing the overall performance of the business and is therefore
useful for investors and prospective investors.
DOLLAR TREE, INC. Segment Information (In
millions, except store count) 13 Weeks
Ended
April 30, 2016
May 2, 2015
(Unaudited) (Unaudited)
As Reported
AsReported
Adj(a)
AsAdjusted
Net sales: Dollar Tree $ 2,384.5 $ 2,176.7 $ - $
2,176.7 Family Dollar
2,701.3
- -
- Total net sales
$
5,085.8 $ 2,176.7
$ - $
2,176.7 Gross profit: Dollar Tree
$ 820.8 $ 748.9 $ - $ 748.9 Family Dollar
733.8
- -
- Total gross profit
$
1,554.6 $ 748.9
$ - $
748.9 Operating income: Dollar
Tree $ 280.7 $ 232.8 $ 10.4 $ 243.2 Family Dollar
138.0 -
- - Total operating
income
$ 418.7 $
232.8 $ 10.4
$ 243.2 13 Weeks
Ended April 30, 2016 May 2, 2015
DollarTree
FamilyDollar
Total
DollarTree
FamilyDollar
Total Store Count: Beginning 5,954 7,897
13,851 5,367 - 5,367 New 112 59 171 93 - 93 Rebanner (b) (6 ) - (6
) - - - Closings
(11 )
(8 ) (19 )
(6 ) -
(6 ) Ending
6,049
7,948 13,997
5,454 -
5,454 Selling Square Footage (in
millions)
52.1 57.5
109.6 47.2
- 47.2 Growth Rate
(Square Footage)
10.4 %
100.0 % 132.2 %
7.3 % 0.0
% 7.3 %
(a) The adjustments to Operating income are related to the
acquisition of Family Dollar Stores, Inc. (b) Stores are included
as rebanners when they close or open, respectively. NOTE:
These condensed consolidated income statements have been prepared
on a basis consistent with our previously prepared income
statements filed with the Securities and Exchange Commission for
our prior quarter and annual periods, with the exception of the
footnotes required by GAAP for complete financial statements and
inclusion of certain non-GAAP adjustments and measures as described
in footnote (a) above. Management believes the reporting of
comparable results is important in assessing the overall
performance of the business and is therefore useful for investors
and prospective investors. The results of Family Dollar's
operations are included from the July 6, 2015 acquisition date.
DOLLAR TREE, INC. Condensed Consolidated
Balance Sheets (In millions) (Unaudited)
April 30,2016
January 30,2016 May
2,2015 Cash and cash equivalents $ 929.7 $ 736.1
$ 870.4 Restricted cash - - 7,244.1 Short-term investments 4.0 4.0
- Merchandise inventories, net 2,929.5 2,885.5 1,093.5 Current
deferred tax assets, net - - 19.8 Other current assets 308.9
310.3 107.8 Total current assets 4,172.1 3,935.9
9,335.6 Property, plant and equipment, net 3,153.2 3,125.5
1,226.0 Assets available for sale 11.7 12.1 - Goodwill 5,024.9
5,021.7 166.1 Deferred tax assets, net - - 38.6 Favorable lease
rights, net 543.9 569.4 0.2 Tradename intangible asset 3,100.0
3,100.0 - Other intangible assets, net 5.6 5.8 1.1 Other assets,
net 49.5 130.8 101.6 Total assets $
16,060.9 $ 15,901.2 $ 10,869.2 Current portion of
long-term debt $ 120.5 $ 108.0 $ - Accounts payable 1,260.3 1,251.9
515.6 Other current liabilities 622.1 722.6 474.3 Income taxes
payable 46.2 12.9 25.3 Total current
liabilities 2,049.1 2,095.4 1,015.2 Long-term debt, net
7,209.8 7,238.4 7,819.7 Unfavorable lease rights, net 142.9 149.3 -
Deferred tax liabilities, net 1,566.2 1,586.6 - Income taxes
payable, long-term 71.1 71.4 6.1 Other liabilities 352.2
353.2 157.4 Total liabilities 11,391.3
11,494.3 8,998.4 Shareholders' equity
4,669.6 4,406.9 1,870.8 Total liabilities and
shareholders' equity $ 16,060.9 $ 15,901.2 $ 10,869.2 The
January 30, 2016 information was derived from the audited
consolidated financial statements as of that date.
DOLLAR TREE, INC. Condensed Consolidated Statements of
Cash Flows (In millions) (unaudited)
13 Weeks Ended
April 30,2016
May 2,2015 Cash flows from operating
activities: Net income $ 232.7 $ 69.5
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 162.3 52.8 Provision for deferred
taxes (20.4 ) 1.2 Amortization of debt discount and debt-issuance
costs 4.7 2.6 Other non-cash adjustments to net income 27.7 22.2
Changes in operating assets and liabilities (96.0 )
2.1 Total adjustments 78.3 80.9
Net cash provided by operating activities 311.0
150.4 Cash flows from investing activities:
Capital expenditures
(175.9 ) (66.9 ) Increase in restricted cash - (7,244.1 ) Purchase
of restricted investments (36.1 ) - Proceeds from sale of
restricted investments 118.1 - Proceeds from fixed asset
disposition 1.1 - Net cash used in
investing activities (92.8 ) (7,311.0 ) Cash
flows from financing activities: Principal payments for long-term
debt (20.8 ) - Proceeds from long-term debt, net of discount -
7,180.2 Debt-issuance costs - (5.2 )
Proceeds from stock issued pursuant to
stock-based compensation plans
14.4 2.6 Cash paid for taxes on exercises/vesting of stock-based
compensation (18.4 ) (20.6 ) Tax benefit of exercises/vesting of
stock-based compensation - 9.6 Net cash
provided by (used in) financing activities (24.8 )
7,166.6 Effect of exchange rate changes on cash and cash
equivalents 0.2 0.3 Net increase in
cash and cash equivalents 193.6 6.3 Cash and cash equivalents at
beginning of period 736.1 864.1 Cash
and cash equivalents at end of period $ 929.7 $ 870.4
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160526005618/en/
Dollar Tree, Inc.Randy Guiler, 757-321-5284Vice President,
Investor Relationswww.DollarTree.comDLTR-E
Dollar Tree (NASDAQ:DLTR)
Historical Stock Chart
From Mar 2024 to Apr 2024
Dollar Tree (NASDAQ:DLTR)
Historical Stock Chart
From Apr 2023 to Apr 2024