ToplineShares of Dollar Tree dropped 14% Wednesday after the company announced tough fourth-quarter earnings and said it would shutter 1,000 of its stores, marking the discount retailer’s worst day in more than six months.On Tuesday, Dollar Tree announced it would close 1,000 stores—mostly from the struggling Family ... [+] Dollar subsidiary.Frederic J. Brown/AFP via Getty Key FactsShares of Dollar Tree fell 14.4% Wednesday following an early-morning announcement of a lackluster fourth quarter. Wednesday m ...

As even affluent consumers see their spending power diminish, Dollar Tree is making gains with high-income shoppers, even as the business on the whole faces ongoing challenges.The discount retail giant, which owns its self-titled banner as well as Family Dollar, shared on a call discussing its fourth-quarter fiscal 2023 financial results that it is benefitting from an influx of new higher-income customers. Despite prevailing economic challenges, Dollar Tree attracted 3.4 million additional customers in 2023 ...

Dollar Tree, Inc. (DLTR) has reported fourth-quarter fiscal 2023 results, wherein earnings and sales missed the Zacks Consensus Estimate. The top line declined year over year, while earnings improved. The company’s results have benefited from gains across both segments, higher traffic and robust market share growth. However, product cost inflation, an unfavorable sales mix and elevated shrink continued to hurt.Dollar Tree’s earnings increased 25% year over year to $2.55 per share. However, earnings missed t ...

Dollar Tree says it plans to close nearly of its 1,000 Family Dollar locations.The discount retailer announced the closures with its earnings report Wednesday (March 13), saying that a review of its properties had identified 600 for closure in the first half of its fiscal year, and another 370 that will close once their leases expire. Another 30 Dollar Tree stores will close, too, once their leases are up.The company had revealed in November that it was beginning a review of Family Dollar to address underpe ...

Financial Data and Key Metrics - Consolidated net sales increased by 12% to $8.6 billion, including a $560 million benefit from the 53rd week [43] - Adjusted operating income increased by 21% to $749 million, with adjusted operating margin improving by 70 basis points [43] - Adjusted EPS grew 25% to $2.55, despite a $0.17 per share negative impact from unanticipated costs [43] - Dollar Tree segment comps were up 6.3%, driven by a 7.1% increase in traffic and a 0.7% decrease in ticket [32] - Family Dollar segment comps declined 1.2%, with a 0.7% traffic increase offset by a 2% ticket decline [34] Business Line Data and Key Metrics - Dollar Tree's consumable comp increased by 10.8%, while discretionary comp rose by 3.1% [32] - Family Dollar's consumables comp decelerated to 2.2% in Q4 from 6.2% in Q3, while discretionary comp declined by 12% [34] - Dollar Tree added 3.4 million new customers in 2023, mostly from households earning over $125,000 annually [44] - Family Dollar's private brand penetration reached 15%, 100 basis points ahead of target [69] Market Data and Key Metrics - Dollar Tree's multi-price point strategy, "More Choices," has been rolled out to over 6,500 stores, with $3, $4, and $5 frozen and refrigerated items now available [33] - Family Dollar's reduced SNAP benefits impacted total Q4 comps by approximately 5 points, with a total comp impact closer to 7 points when combined with weak discretionary demand [46] - Dollar Tree's unit volume grew 8% while the market declined 1.5%, according to Nielsen [44] Company Strategy and Industry Competition - The company plans to close approximately 600 Family Dollar stores in the first half of fiscal 2024, with an additional 370 Family Dollar and 30 Dollar Tree stores to close at the end of their lease terms [31] - Dollar Tree's multi-price assortment is expected to expand by over 300 items across 3,000 stores, with price points ranging from $1.50 to $7 [45] - Family Dollar is focusing on improving its consumable mix and private brand offerings, with the goal of reaching 20% private brand penetration by 2026 [69] Management Commentary on Operating Environment and Future Outlook - Management noted that persistent inflation and reduced government benefits continue to pressure lower-income consumers, particularly affecting Family Dollar [34] - The company expects reduced SNAP benefits to remain a headwind through at least the first half of FY 2024 [46] - Management remains optimistic about the long-term potential of Family Dollar, emphasizing operational excellence and financial performance [35] Other Important Information - The company opened 641 new stores in 2023, with a focus on Dollar Tree openings due to their attractive returns [47] - Family Dollar's distribution center in West Memphis has been revamped, improving overall efficiency [48] - The company has launched new mobile apps for both Family Dollar and Dollar Tree, enhancing customer experience and targeted promotions [49] Q&A Session Summary Question: What is driving the lower average ticket at Dollar Tree despite higher price points? [3] - Answer: The lower average ticket is driven by increased customer frequency, with more trips leading to smaller baskets [4][5] Question: What is the cash cost of closing 600 Family Dollar stores? [3] - Answer: The cash cost of closing these stores is expected to be neutral to accretive, with significant cash requirement reductions over the next three years [7] Question: How was the 5% SNAP headwind calculated for Family Dollar? [10] - Answer: The 5% headwind was derived based on the year-over-year contribution of SNAP benefits and customer penetration [11] Question: What are the competitive dynamics in the consumables category for Family Dollar? [12] - Answer: The market remains stable, with Family Dollar's pricing position described as the best it has ever been [22] Question: How have supply chain changes impacted inventory levels and turns? [15] - Answer: Supply chain improvements have led to better in-stock positions, with reduced unloading times and improved inventory flow [16][17][18] Question: What is the outlook for Family Dollar's store closures and their impact on sales? [56] - Answer: The closures are expected to transfer some sales to operating stores, with the underperforming stores not benefiting from the same lift as others due to location and competitive factors [57] Question: What is the margin outlook by banner for fiscal 2024? [140] - Answer: Dollar Tree is expected to achieve a gross margin of 36% to 36.5%, while Family Dollar faces headwinds from shrink and mix, with a gross margin range of 24.5% to 25% [142][143] Question: What is the strategy for expanding multi-price point offerings at Dollar Tree? [156] - Answer: The rollout will be staggered, with the goal of integrating multi-price merchandise into the aisles for better shoppability [156][158]

About this content About Leo Grieco Leo joins us with a degree in Media Production from Bournemouth University. His work includes reporting for the UK editorial team and video editing for the broadcast team. He comes with an expertise in video editing and producing. Leo’s specialities include hospitality and leisure, support services, tech and video games. Read more About the publisher Proactive financial news and online broadcast teams provide fast, accessible, informative and actionable business and fi ...

Dollar Tree is planning to close nearly 1,000 stores collectively between its namesake general discount stores and subsidiary chain, Family Dollar.Family Dollar will close 600 locations in the first half of 2024 and 370 stores over the next several years as store leases expire, the company said Wednesday. 3 After reporting a net loss of $1.71 billion Wednesday, Dollar Tree said that it would be closing 30 stores in the coming years as leases expire. Getty ImagesDollar Tree, which bought Family Dollar for ...

Shares of discount retail chain Dollar Tree (DLTR -14.81%) got hammered on Wednesday after the company reported a whopping $1.7 billion net loss in its most recent quarter. As of 9:45 a.m. ET, Dollar Tree stock was down 13%.It's time to update Dollar Tree's footprintIn the fourth quarter of 2023, Dollar Tree generated net sales of $8.6 billion, which were up 12% year over year and right on schedule. However, the company swung to its massive aforementioned loss because it recognizes that it has too many unde ...

Dollar Tree (DLTR) reported $8.64 billion in revenue for the quarter ended January 2024, representing a year-over-year increase of 12%. EPS of $2.55 for the same period compares to $2.04 a year ago.The reported revenue represents a surprise of -0.38% over the Zacks Consensus Estimate of $8.67 billion. With the consensus EPS estimate being $2.67, the EPS surprise was -4.49%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine t ...

Key TakeawaysDollar Tree posted fourth-quarter earnings Wednesday that fell short of analyst estimates.The discount retailer also announced plans to close 600 Family Dollar locations in the first half of the 2024 fiscal year, and 400 more Family Dollar and Dollar Tree locations in the "next several years."Shares fell in pre-market trading as investors reacted to the results. Dollar Tree (DLTR) shares plunged 8% in pre-market trading Wednesday as the discount retailer posted fourth-quarter results that misse ...