Sales, earnings grow at Dollar Tree
Dollar Tree harvested some impressive results in Q2 fiscal 2020.
The dollar store retailer reported a consolidated net sales increase of 9.4% to $6.28 billion from $5.74 billion in the prior year’s second quarter. Enterprise same-store sales increased 7.2%. Same-store sales for Family Dollar increased 11.6%, while Dollar Tree same-store sales increased 3.1%.
Net income was $261.5 million in the second quarter, up 45% from $180.3 milllion, and diluted earnings per share for the quarter increased 44.7% to $1.10, compared to $0.76 per share in the prior year’s quarter.
The company opened 131 new stores, expanded or relocated 22 stores, and closed 26 stores. Additionally, Dollar Tree completed 76 renovations to the Family Dollar H2 format. Retail selling square footage at quarter end was approximately 123.1 million-sq.-ft.
“Consumer shopping patterns are evolving. Customers are shopping with a purpose, while looking to minimize risk and exposure,” said Mike Witynski, president and CEO, Dollar Tree. “As a result, we are seeing material increases in average ticket, while seeing a decline in average visits. At Dollar Tree, we were pleased to see a nice bounce back in the higher margin discretionary side of the business following Easter; and the expanded Crafter’s Square assortment continues to perform very well. We will continue to manage our business with increased clarity, focus and speed to deliver the value and convenience that customers are looking for. I could not be more proud of the entire team’s commitment and efforts, and we are well-prepared for the back half of the year.”
Given the expectation of continued volatility and uncertainty, Dollar Tree withdrew previously issued guidance in March 2020 and is not issuing updated guidance. However, the company continues to expect the completion of 500 new store openings (consisting of 325 Dollar Tree and 175 Family Dollar) and 750 Family Dollar H2 store renovations in fiscal 2020.