Family Dollar reports 3% lift in Q2 sales as Dollar Tree transaction progresses

MATTHEWS, N.C. - Family Dollar Stores on Wednesday reported that total net sales in the second quarter of fiscal 2015 increased 3% to $2.8 billion. Comparable store sales for the 13-week period increased 0.5% as a result of an increase in the number of customer transactions which was offset by a decrease in the average customer transaction value. 

 

“We continue to see tangible benefits from the investments we have made to strengthen our value proposition for customers. Our comparable store sales and customer traffic trends are improving, and we are beginning to see stabilization in key categories," stated Howard Levine, Family Dollar chairman and CEO. "While our trends in late-February were adversely impacted by severe winter weather, our sales trends in March rebounded nicely, reflecting both improved traffic trends and the benefit of an earlier Easter,” he said. “We are excited about the pending merger with Dollar Tree, and our teams are working to ensure a successful integration.” 

 

Net sales of consumables increased 4.6% in the second quarter of fiscal 2015 and represented 72.3% of total net sales, compared to 71.1% of net sales in the second quarter of fiscal 2014. Net sales of discretionary categories (including apparel and accessories, home products and seasonal and electronics) decreased 1% in the second quarter of fiscal 2015 to 27.7% of net sales, compared to 28.9% of net sales in the second quarter of fiscal 2014. 

 

Capital expenditures were $176.5 million in the first half of fiscal 2015 as compared to $219.7 million in the first half of fiscal 2014. The reduction in capital expenditures was primarily due to fewer new store openings and a reduction in technology investments. These reductions were partially offset by increased investments in security equipment and merchandise fixtures in existing stores. 

 

During the first half of fiscal 2015, the company opened 161 new stores and closed 19 stores as compared to 244 new store openings and 22 closings in the first half of fiscal 2014. Family Dollar also renovated, relocated or expanded 291 stores in the first half of fiscal 2015, as compared to 319 stores in the first half of fiscal 2014. 

 

In light of its pending transaction Dollar Tree, the Company has not provided earnings guidance for fiscal 2015 and will not hold a conference call to discuss its second quarter results.