Dollar Tree Sees Jump In Q3 Sales

Third quarter sales at Dollar Tree were up more than 5% with growth in foot traffic and same-store sales cited by company officials as key drivers.

For the quarter ended October 28, net sales were $7.31 billion, an increase of 5.4% when compared to the same quarter the previous year. Enterprise same-store net sales increased 3.9%, driven by a 4.7% increase in traffic, partially offset by a 0.8% decline in average ticket. 

Dollar Tree same-store net sales increased 5.4%, driven by a 7.0% increase in traffic, partially offset by a 1.5% decline in average ticket. Family Dollar’s 2.0% same-store net sales increase was comprised of a 1.4% increase in traffic and a 0.7% increase in average ticket.

Operating income was $301.7 million, down 20.9%, with diluted earnings per share of $0.97, down 19.2% year-over-year.

“Our third-quarter results were within our expectations thanks to continued execution across all aspects of our business transformation,” said Rick Dreiling, chairman and CEO of Dollar Tree. “In a challenging environment, our performance was among the best in retail as we continue to grow traffic, unit, and sales per square foot.”

During the quarter, the company opened 197 new stores, expanded multi-price Plus offerings to 870 Dollar Tree stores, and added $3, $4, and $5 frozen and refrigerated items to 920 additional Dollar Tree stores.

Year-to-date, consolidated net sales increased 6.5% to $21.9 billion. Enterprise same-store net sales increased 5.2%. Dollar Tree same-store net sales increased 5.6%, driven by a 7.5% increase in traffic, partially offset by a 1.8% decline in average ticket. Family Dollar’s 4.8% same-store net sales increase consisted of a 3% increase in traffic along with a 1.7% increase in average ticket.

For the fourth quarter, the company expects consolidated net sales will range from $8.6 billion to $8.8 billion, based on a low-single-digit increase in same-store sales for the enterprise, a mid-single-digit increase for the Dollar Tree segment, and a decrease of 1.0% to an increase of 1.0% for the Family Dollar segment. Diluted EPS for the quarter is estimated to be in the range of $2.58 to $2.78.