Family Dollar profits beat Street; Dollar Tree merger expected in May

Matthews, N.C. – Profits slid at Family Dollar Stores Inc. during the second quarter of fiscal 2015 compared to last year, but still beat Wall Street predictions. The discounter reported net income of $76.7 million, down 18% from $90.9 million.



Fees related to the company’s pending merger with Dollar Tree Inc., as well as higher expenses, helped reduce net income. That merger is now expected to close in May 2015. In a filing with the Securities and Exchange Commission (SEC), Dollar Tree said the Federal Trade Commission (FTC) has completed its merger review as of April 1 and identified approximately 340 stores for divestiture, with all or almost all of the stores that will be divested to be Family Dollar stores.



Total net sales increased 3% to $2.8 billion, from $2.72 billion. Same-store sales increased 0.5% as a result of an increase in the number of customer transactions which was offset by a decrease in the average customer transaction value.



“Our comparable store sales and customer traffic trends are improving, and we are beginning to see stabilization in key categories,” said Howard R. Levine, chairman and CEO. “While our trends in late-February were adversely impacted by severe winter weather, our sales trends in March rebounded nicely, reflecting both improved traffic trends and the benefit of an earlier Easter. We are excited about the pending merger with Dollar Tree, and our teams are working to ensure a successful integration.”