“Shoppers are responding to our new value proposition at Family Dollar and Dollar Tree as we focus on driving both traffic and store productivity,” said CEO Mike Witynski.
Dollar Tree (DLTR) – Get Free Report posted better-than-expected third quarter earnings Tuesday, while lifting its full-year sales forecast, as consumers continue to trade down to the discount retail space amid surging inflation and uncertain economic prospects.
Shares in the group were hit hard, however, by the group’s forecast that diluted earnings would be in the “lower half” of its prior forecast of between $7.10 to $7.40 per share.
Dollar Tree said diluted earnings for the three months ending on October 29 came in at $1.20 per share, up 25% from the same period last year and just ahead of the Street consensus forecast of $1.18. Group revenues, Dollar Tree said, rose 8.1% to $6.94 billion, again topping analysts’ estimates of a $6.84 billion tally. Same-store sales were up 8.6%, Dollar Tree said.
Looking into the final months of the group’s fiscal year, Dollar Tree said it sees overall revenues ranging between $28.14 billion and $28.28 billion, up from its prior forecast of between $27.85 billion to $28.10 billion, with a mid-single digit increase for same-store sales.
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“Our third quarter sales performance reflects the timely execution of merchandising initiatives to drive our consumables business in this uncertain and inflationary environment,” said CEO Mike Witynski. “Same-store sales for both segments improved from the prior quarter and delivered a sequential monthly improvement throughout the quarter. Shoppers are responding to our new value proposition at Family Dollar and Dollar Tree as we focus on driving both traffic and store productivity.”
“I am very proud of our associates for their willingness to accept and embrace change. Our new executive team is in place who will lead the Company through the next evolution of growth,” he added. “We are committed to transforming our culture, meeting our shoppers’ and associates’ needs, improving store productivity and efficiencies, and delivering improved long-term operating results.”
Dollar Tree shares were marked 5.6% lower in pre-market trading immediately following the earnings release to indicate an opening bell price of $156.01 each.
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