Dollar Tree has reported its first quarter results ended May 2, with a consolidated net sales increase of 8.8% to $2.18 billion from $2 billion in the prior year’s first quarter. Consolidated same-store sales increased 3.4% on a constant currency basis, compared to a 2% increase in the prior-year period.
Adjusted for the impact of Canadian currency fluctuations, the same-store sales increase was 3.1%, according to the retailer. Sales performance was negatively impacted by delayed receipts at four of the company’s 10 distribution centers related to the West Coast port congestion and the previously disclosed estimate of $8 million impact from the holiday calendar shift.
The quarter included $10.4 million in acquisition-related costs associated with the pending merger with Family Dollar Stores.
Net income, compared to the prior year’s first quarter, including acquisition-related costs, was $69.5 million and diluted earnings per share were $0.34, compared with earnings of $138 million in last year’s period. Excluding acquisition-related costs, net income increased approximately $8 million to $146.3 million and diluted earnings per share increased 6% to $0.71, according to the retailer.
“Comparable store sales grew as the result of increases in both traffic and average ticket,” stated Bob Sasser, Dollar Tree CEO. “Despite challenges presented by delayed receipts of merchandise related to the West Coast port congestion and the impact of the holiday calendar shift, our team worked together to deliver solid sales and earnings, both of which were well within our guidance range. We entered the second quarter with fresh inventory, stocked shelves, and greater values than ever for our customers.”
Dollar Tree also reported that its continues to make progress with the Federal Trade Commission and divestiture buyers in order to complete the company’s pending acquisition of Family Dollar. The retailer plans to divest approximately 330 Family Dollar stores representing approximately $45.5 million of operating income. The company said it intends to reach an agreement with a divestiture buyer in the coming days and secure FTC clearance thereafter. The company intends to close the proposed merger in early July 2015.
Dollar Tree, which operates 5,454 stores across 48 states and five Canadian provinces, opened 93 stores, expanded or relocated 10 stores, and closed six stores during the quarter.