Family Dollar To Shut 600 Stores In 2024

Family Dollar’s store count will shrink in the first half of 2024 as the discount retailer will close approximately 600 stores, with additional closures planned in the coming years.

News of the store reductions was made by Family Dollar’s parent company, Dollar Tree, during its fourth quarter and full year report on the company’s finances. The company said it has also identified an additional 370 Family Dollar stores and 30 Dollar Tree locations for closure as the lease for each of those 400 stores come to term. 

The plan to reduce store count follows Dollar Tree’s fourth quarter, in which the discount retailer reported an 11.9% increase in net sales to $8.63 billion for the quarter ended February 3. Enterprise same-store net sales increased 3.0%, driven by a 4.6% increase in traffic, partially offset by a 1.5% decline in average ticket. 

Dollar Tree same-store net sales increased 6.3%, driven by a 7.1% increase in traffic, partially offset by a 0.7% decline in average ticket. Family Dollar’s same-store net sales decreased 1.2%, driven by a 0.7% increase in traffic, partially offset by a 2.0% decline in average ticket. 

Net loss was $1.71 billion and diluted loss per share was $7.85. Adjusted diluted EPS reflects approximately $0.17 of net negative impact, primarily related to unfavorable development of general liability insurance claims.

“We finished the year strong, with fourth quarter results reflecting positive traffic trends, market share gains, and adjusted margin improvement across both segments,” said Rick Dreiling, chairman and chief executive officer. “While we are still in the early stages of our transformation journey, I am proud of what our team accomplished in 2023 and see a long runway of growth ahead of us. As we look forward in 2024, we are accelerating our multi-price rollout at Dollar Tree and taking decisive action to improve profitability and unlock value at Family Dollar.”

For the full year, consolidated net sales increased 8% to $30.6 billion. Enterprise same-store net sales increased 4.6%. Dollar Tree same-store net sales increased 5.8%, driven by a 7.4% increase in traffic, partially offset by a 1.5% decline in average ticket. Family Dollar’s 3.2% same-store net sales increase was comprised of a 2.5% increase in traffic along with a 0.7% increase in average ticket.

Net loss was $998.4 million and diluted loss per share was $4.55. Adjusted diluted earnings per share reflects approximately $0.24 of net negative impact, primarily related to unfavorable development of general liability claims.

Looking ahead to the current fiscal year, Dollar Tree officials are forecasting consolidated net sales to range from $31 billion to $32 billion. The company expects to deliver a low-to-mid-single digit comparable store net sales increase for the year, consisting of a mid-single-digit increase in the Dollar Tree segment and a low-single-digit increase in the Family Dollar segment. Diluted earnings per share is expected to range from $6.70 to $7.30.