Financial Data and Key Metrics Changes - In Q1, adjusted EPS from continuing operations was $1.26, exceeding the high end of the outlook range of $1.10 to $1.25 [22] - Revenue increased by 11.3% year-over-year, driven by a 5.4% comparable store sales growth and a 7.4% increase in square footage [22] - Adjusted operating income was $388 million, a 1.4% increase from last year, while adjusted operating margin declined by 80 basis points [22][23] Business Line Data and Key Metrics Changes - Comp sales for consumables increased by 6.4%, while discretionary comp sales rose by 4.6%, marking the highest discretionary comp since Q4 of 2022 [9] - Revenue contribution from non-comp stores was up nearly 90% year-over-year, led by strength in the former $0.99 only portfolio [9] Market Data and Key Metrics Changes - The company gained unit market share in Q1, with new customers and increased trip frequency driving share gains [10] - 2.6 million new customers were added in Q1, with a 9% increase in customers visiting stores three times a month or more [11] Company Strategy and Development Direction - The company is focused on expanding its footprint, recently opening its 9,000th store in Plano, Texas, and plans to convert approximately half of its store base to the Multi-Price format by year-end [8][13] - The Multi-Price strategy is seen as a way to enhance agility and meet customer needs across various economic conditions [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by tariffs and inflation but expressed confidence in their ability to mitigate these impacts using five strategic levers [14][18] - The full-year adjusted EPS outlook was updated to a range of $5.15 to $5.65, reflecting ongoing share repurchases [18][27] Other Important Information - The company received U.S. regulatory approval for the sale of Family Dollar, which is expected to close in early summer [19] - The company ended the quarter with $1 billion in cash and cash equivalents, maintaining ample liquidity [24][33] Q&A Session Summary Question: What will be the offset that Dollar Tree is able to achieve in the back half of the year? - Management stated that they have created a more nimble company capable of addressing volatility and can offset tariff impacts over time using their five levers [41][42] Question: Can you maintain a gross margin of 35% to 36% despite current tariffs? - Management expressed confidence in maintaining gross margins through effective product assortment and leveraging their five levers for cost mitigation [48][49] Question: What is happening at the $1.50 price point? - Management clarified that they are strategically focused on customer needs and leveraging the Multi-Price strategy to meet those needs without drastically changing their pricing model [52] Question: How is the inventory composition changing? - The company noted a 10% increase in inventory, with some impact from tariffs, and emphasized the importance of maintaining quality and availability for customer satisfaction [90][92]

Financial Data and Key Metrics Changes - In Q1 2025, Dollar Tree reported adjusted EPS from continuing operations of $1.26, exceeding the high end of the outlook range of $1.10 to $1.25 [20] - Revenue increased by 11.3% year-over-year, driven by a 5.4% comparable store sales growth and a 7.4% increase in square footage [20] - Adjusted operating income was $388 million, a 1.4% increase from the previous year, while adjusted operating margin declined by 80 basis points [20] Business Line Data and Key Metrics Changes - Comparable store sales (comps) increased by 5.4%, with consumables comp up 6.4% and discretionary comp up 4.6%, marking the highest discretionary comp since Q4 2022 [7][20] - Revenue contribution from non-comparable stores rose nearly 90% year-over-year, primarily from the former $0.99 only portfolio [7] Market Data and Key Metrics Changes - Dollar Tree gained unit market share in Q1, with new customers and increased trip frequency contributing to this growth [9][10] - The company added 2.6 million new customers in Q1, with a notable increase in visits from higher-income households [10][11] Company Strategy and Development Direction - The company is focused on expanding its multi-price strategy, which has shown positive results in driving traffic and sales [15][18] - The sale of Family Dollar is expected to close in early summer, which will sharpen operational focus and strengthen the balance sheet [17][32] - Dollar Tree aims to mitigate inflationary cost pressures, including tariffs, through five strategic levers [13][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating near-term challenges and achieving profitability goals despite anticipated volatility in Q2 [28][32] - The company updated its full-year adjusted EPS outlook to a range of $5.15 to $5.65, reflecting ongoing share repurchases [16][26] Other Important Information - The company ended Q1 with $1 billion in cash and cash equivalents, maintaining ample liquidity to meet ongoing capital needs [22][31] - Capital expenditures for the year are expected to be between $1.2 billion and $1.3 billion, including the opening of approximately 400 new Dollar Tree stores [31] Q&A Session Summary Question: What will be the offset that Dollar General is able to achieve in the back half of the year? - Management believes they have created a more nimble company capable of addressing volatility and can offset costs using their five levers [38][39] Question: Do you expect to maintain a gross margin of 35% to 36% despite current tariffs? - Management is confident in maintaining gross margin levels through effective negotiation and product assortment strategies [46][47] Question: Can you discuss the impact of the $70 million on COGS from tariffs? - Management indicated that while some costs are one-time, they expect to mitigate ongoing tariff impacts through strategic adjustments [74][76] Question: How is the multi-price strategy performing across different store formats? - The three-point-zero stores continue to outperform, and the company is seeing improvements across all store formats as they implement learnings from the multi-price strategy [70][82] Question: What is the current status of the multi-price point freezer cooler initiative? - The initiative is significant for the multi-price strategy, but implementation varies by store based on demographics and lease restrictions [95] Question: Are you finding a need to invest more in labor as you expand multi-price? - Management noted that sales performance in multi-price stores is strong enough to justify current labor investments without needing additional hours [100]

Group 1 - Proactive provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The news team covers medium and small-cap markets, as well as blue-chip companies, commodities, and broader investment stories [3] - Proactive has a presence in key finance and investing hubs with bureaus and studios located in London, New York, Toronto, Vancouver, Sydney, and Perth [2][3] Group 2 - The company is committed to adopting technology to enhance workflows and improve content production [4] - Proactive utilizes automation and software tools, including generative AI, while ensuring all content is edited and authored by humans [5]

Financial Performance - The Company reported net income of $343.4 million for the 13 weeks ended May 3, 2025, compared to $300.1 million for the same period in 2024, representing an increase of approximately 14.4%[49] - Income from continuing operations was $313.5 million for the 13 weeks ended May 3, 2025, up from $267.7 million in the prior year, reflecting a growth of about 17.1%[49] - Basic earnings per share for continuing operations increased to $1.47 for the 13 weeks ended May 3, 2025, from $1.23 in the prior year, marking a growth of approximately 19.5%[49] Share Repurchase - The Company repurchased 5,926,985 shares of common stock at a cost of $436.8 million during the 13 weeks ended May 3, 2025, compared to 2,537,302 shares for $312.8 million in the same period of 2024[50] Business Transactions - The Company entered into a definitive agreement to sell the Family Dollar business for a purchase consideration of $1,007.0 million, with estimated net proceeds of approximately $800 million expected to close in the second quarter of fiscal 2025[26] - The company has entered into a definitive agreement to sell the Family Dollar business for $1,007.0 million, with estimated net proceeds of approximately $800 million expected to close in Q2 fiscal 2025[60] Insurance and Losses - The Company incurred losses of $117.0 million due to a tornado that destroyed its distribution center in Marietta, Oklahoma, but these losses were fully offset by insurance receivables[30] - The Company received insurance proceeds totaling $150.0 million in fiscal 2024 related to the tornado, including $100.0 million for damaged inventory[32] Debt and Credit Facilities - The Company has a new $1.5 billion revolving credit facility that matures on March 21, 2030, and a $1.0 billion 364-Day Revolving Credit Facility maturing on March 20, 2026[38][41] - The fair value of the Company's Senior Notes was reported at $3,147.6 million as of May 3, 2025, compared to $3,140.9 million as of February 1, 2025[47] - The company’s outstanding payment obligations under the supply chain finance program were $352.0 million as of May 3, 2025, compared to $42.4 million a year earlier[59] Segment Performance - Dollar Tree segment net sales for the 13 weeks ended May 3, 2025, were $4,636.5 million, a 11.3% increase from $4,165.6 million in the same period last year[56] - Gross profit for the Dollar Tree segment was $1,649.5 million, representing a gross margin of 35.5%, compared to $1,476.5 million and a gross margin of 35.4% for the same period last year[56] - Operating income for the Dollar Tree segment was $522.7 million, up from $522.3 million year-over-year, indicating stable operational performance despite increased costs[56] - The Family Dollar business reported net sales of $3,309.6 million for the 13 weeks ended May 3, 2025, down from $3,460.8 million in the prior year, reflecting a decline of approximately 4.4%[61] - Capital expenditures for the Dollar Tree segment were $238.3 million for the 13 weeks ended May 3, 2025, compared to $271.4 million in the same period last year[55] Market Risks and Inflation - The company is exposed to market risks including interest rate changes, with no borrowings outstanding under credit facilities as of May 3, 2025[119] - Inflationary factors impacting the business include merchandise costs, transportation costs (including diesel fuel), store construction-related costs, and labor[120] - Significant inflationary pressures may not be fully offset through product assortment adjustments, operational efficiencies, or increases in comparable store net sales[120] - Failure to manage inflationary costs could harm the business, financial condition, and results of operations[120]

Supplemental Financial Presentation 1st Quarter 2025 KEY TAKEAWAYS First Quarter 2025 Adjusted Diluted EPS From Continuing Operations of $1.26 Forward Looking Statements This Supplemental Financial Presentation contains "forward-looking statements," as that term is used in the Private Securities Litigation Reform Act of 1995, concerning our business and outlook, including our expected sales, comparable store sales, adjusted diluted earnings per share; gross margins, adjusted SG&A expense rates, transition s ...

Financial Performance - Dollar Tree's net sales increased by 11.3% to $4.6 billion compared to the same period in fiscal 2024[10] - Same-store net sales growth was 5.4%, driven by a 2.5% increase in traffic and a 2.8% increase in average ticket[10] - Diluted earnings per share (EPS) from continuing operations was $1.47, representing a 19.5% increase year-over-year[12] - Total revenue for the 13 weeks ended May 3, 2025, was $4,639.7 million, an increase of 11.3% compared to $4,168.9 million for the same period in 2024[32] - Net income for the same period was $343.4 million, up 14.4% from $300.1 million year-over-year[32] - Basic earnings per share from continuing operations increased to $1.47, compared to $1.23 in the prior year, reflecting a growth of 19.5%[32] - Gross profit increased to $988.2 million, resulting in a gross margin of 29.9%, up from 25.2% in the prior year[45] - Operating income rose significantly to $291.9 million, with an operating margin of 8.8%, compared to just 1.1% in the previous year[45] Shareholder Returns - The company completed over $500 million in share repurchases year-to-date, with an additional 780 thousand shares purchased for $67.5 million after the quarter-end[6][13] - Adjusted diluted EPS from continuing operations outlook is updated to a range of $5.15 to $5.65, reflecting the impact of year-to-date share repurchases[19] Store Operations - The company opened 148 new Dollar Tree stores and converted approximately 500 stores to the 3.0 multi-price format[6] - The company opened 148 new stores during the quarter, bringing the total store count to 9,016, a net increase of 496 stores year-over-year[42] - The company closed 25 stores during the quarter, resulting in an ending store count of 7,591, down from 7,877 a year earlier[45] Cash Flow and Liquidity - The company generated $379 million of net cash from operating activities and $130 million of free cash flow from continuing operations[7] - Cash and cash equivalents at the end of the period were $1,311.2 million, an increase from $691.7 million at the same time last year[38] - Free cash flow from continuing operations was $129.7 million, down from $188.7 million in the prior year[62] Outlook and Guidance - The full-year fiscal 2025 net sales outlook is reiterated at a range of $18.5 billion to $19.1 billion, with comparable store net sales growth expected between 3% to 5%[18] Expenses and Margins - Selling, general and administrative expenses increased to $1,268.6 million, representing 27.3% of total revenue, compared to 26.3% in the previous year[32] - The operating income margin decreased to 8.3% from 9.2% year-over-year, indicating a slight decline in operational efficiency[32] - Sales per square foot decreased to $222 from $227 year-over-year, reflecting a decline of 2.2%[45][46] Tax and Other Income - The effective tax rate for the quarter was 25.9%, up from 24.6% in the prior year[32] - The effective tax rate for continuing operations was 25.9%, with an adjusted effective tax rate of 26.1%[59] - Insurance proceeds of $220 million were received related to losses from a tornado that destroyed a distribution center, resulting in a gain of $61.8 million recognized in the first quarter of fiscal 2025[52] - The company incurred $3.7 million in consulting and other expenses related to the strategic review of the Family Dollar business[52] Strategic Initiatives - The sale of Family Dollar is on track to close during the second quarter of fiscal 2025, with estimated net proceeds of approximately $800 million[15]

Group 1 - Dollar Tree is expected to report fiscal first-quarter earnings on June 4, 2025, with estimates of $1.20 per share and $4.53 billion in revenue, reflecting a 13% year-over-year drop in earnings and a 41% decrease in sales compared to the previous year [1] - The company has a market capitalization of $19 billion and reported $18 billion in revenue over the past twelve months, with operating profits of $1.5 billion and a net income of -$3.0 billion [2] - Historically, Dollar Tree's stock has fallen 53% of the time following earnings announcements, with a median one-day decline of 11.1% and a maximum observed drop of 22% [1][2] Group 2 - Dollar Tree is attracting more affluent shoppers due to ongoing inflation, while still being dependent on lower- and middle-income consumers [2] - The company is vulnerable to new tariffs but is attempting to mitigate this through supplier negotiations, manufacturing adjustments, and selective price increases [2] - Over the past five years, Dollar Tree has recorded 19 earnings announcements, with 9 positive and 10 negative one-day returns, resulting in a 47% positive return rate [4]

Core Viewpoint - Analysts forecast a significant decline in Dollar Tree's quarterly earnings and revenues, indicating potential challenges for the company in the upcoming earnings report [1][5]. Earnings Estimates - Dollar Tree is expected to report earnings of $1.19 per share, reflecting a year-over-year decline of 16.8% [1]. - The consensus EPS estimate has been adjusted downward by 2.7% over the past 30 days, indicating a reassessment by analysts [2]. Revenue Projections - Total net sales are projected to reach $4.53 billion, representing a year-over-year decline of 40.5% [5]. - Other revenue is expected to be $3.65 million, indicating a year-over-year change of -44.2% [5]. Store Metrics - Analysts predict that the number of stores closed will be 13, down from 16 in the same quarter last year [5]. - The ending stores are estimated to reach 8,969, an increase from 8,520 reported in the same quarter last year [6]. - New stores are projected at 100, compared to 116 in the previous year [6]. Operational Metrics - Selling square footage is expected to reach 79.46 million square feet, up from 74.1 million square feet in the same quarter last year [7]. - Operating income is anticipated to be $526.21 million, slightly up from $522.30 million reported in the same quarter of the previous year [7]. Market Performance - Dollar Tree shares have increased by 11.5% over the past month, outperforming the Zacks S&P 500 composite, which rose by 6.4% [8].

Core Viewpoint - Dollar Tree, Inc. is expected to report a decline in both revenue and earnings for the first quarter of fiscal 2025, with significant pressures from reduced consumer spending and inflationary challenges [1][5][7]. Financial Performance - The Zacks Consensus Estimate for revenues is $4.5 billion, reflecting a 40.5% decrease from the same quarter last year [1]. - The consensus estimate for earnings is $1.20 per share, indicating a 16.1% decline year-over-year [1]. - The company has a trailing four-quarter negative earnings surprise of 8.4% on average, with the last quarter's earnings missing the estimate by 3.2% [4]. Market Trends - Continued soft demand for discretionary items is anticipated due to reduced spending among low-income consumers [5]. - Inflationary pressures and increased interest rates are contributing to the company's challenges [5]. - Adverse foreign currency translations are also negatively impacting performance [5]. Operational Adjustments - The company is diversifying its supplier base and exploring alternative manufacturing locations to mitigate risks from additional tariffs [6]. - Adjustments to sourcing strategies may lead to transitional inefficiencies and increased short-term costs, affecting first-quarter results [6]. Cost Structure - Higher selling, general and administrative (SG&A) expenses are expected to negatively impact the top and bottom lines due to elevated operating costs [7]. - Earnings are projected to be negatively impacted by 30-35 cents per share due to shared service costs related to the Family Dollar sale [9]. Strategic Initiatives - Dollar Tree is making progress on restructuring and expansion initiatives, including steady store openings and improvements in distribution centers [10]. - Management predicts comparable store sales growth of 3-5%, with a model forecasting a 4.7% year-over-year increase for the Dollar Tree banner [11]. Valuation Insights - Dollar Tree shares are trading at a forward 12-month price-to-earnings ratio of 16.47X, below the five-year median of 17.86X and the industry average of 33.28X, indicating attractive valuation [13]. - The stock has gained 230.7% in the past three months, contrasting with a 1.3% decline in the industry [16].

Group 1: Stock Performance - Dollar Tree (DLTR) closed at $89.34, reflecting a -1.13% change from the previous session, underperforming the S&P 500's loss of 0.56% [1] - Over the past month, Dollar Tree shares have appreciated by 11.71%, outperforming the Retail-Wholesale sector's gain of 5.88% and the S&P 500's gain of 7.37% [1] Group 2: Earnings Expectations - Dollar Tree is expected to report earnings on June 4, 2025, with an anticipated EPS of $1.18, representing a 17.48% decline compared to the same quarter last year [2] - The consensus estimate projects revenue of $4.54 billion, reflecting a 40.47% decrease from the equivalent quarter last year [2] - For the full year, analysts expect earnings of $5.17 per share and revenue of $18.93 billion, indicating changes of +1.37% and -38.58% respectively from the previous year [3] Group 3: Analyst Projections and Valuation - Recent shifts in analyst projections for Dollar Tree are important, as positive estimate revisions indicate optimism about the company's business and profitability [4] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently ranks Dollar Tree at 3 (Hold) [6] - Dollar Tree has a Forward P/E ratio of 17.46, which is a discount compared to the industry's average Forward P/E of 22.14 [6] Group 4: Industry Context - Dollar Tree has a PEG ratio of 2.07, compared to the Retail - Discount Stores industry's average PEG ratio of 2.75 [7] - The Retail - Discount Stores industry is part of the Retail-Wholesale sector and currently holds a Zacks Industry Rank of 144, placing it in the bottom 42% of all industries [7][8]