Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Aug. 01, 2015 | Aug. 27, 2015 | |
Document and Entity Information [Text Block] [Abstract] | ||
Entity Registrant Name | Dollar Tree Inc | |
Entity Central Index Key | 935,703 | |
Current Fiscal Year End Date | --01-30 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 234,717,599 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Aug. 1, 2015 |
CONSOLIDATED STATEMENT OF OPERA
CONSOLIDATED STATEMENT OF OPERATIONS - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2015 | Aug. 02, 2014 | Aug. 01, 2015 | Aug. 02, 2014 | |
Income Statement [Abstract] | ||||
Net sales | $ 3,011.2 | $ 2,031.1 | $ 5,187.8 | $ 4,031.4 |
Cost of sales | 2,156 | 1,337 | 3,583.7 | 2,640.7 |
Gross profit | 855.2 | 694.1 | 1,604.1 | 1,390.7 |
Selling, general and administrative expenses | 731.8 | 489.1 | 1,247.8 | 953.8 |
Operating income | 123.4 | 205 | 356.3 | 436.9 |
Interest expense, net | 263.9 | 8.4 | 386.2 | 16.6 |
Other (income) expense, net | 1.7 | 0 | (0.9) | 0 |
Income (loss) before income taxes | (142.2) | 196.6 | (29) | 420.3 |
Income tax expense (benefit) | (44.2) | 75.1 | (0.5) | 160.6 |
Net income (loss) | $ (98) | $ 121.5 | $ (28.5) | $ 259.7 |
Net income per share: | ||||
Basic net income per share (usd per share) | $ (0.46) | $ 0.59 | $ (0.14) | $ 1.26 |
Diluted net income per share (usd per share) | $ (0.46) | $ 0.59 | $ (0.14) | $ 1.25 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Statement - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2015 | Aug. 02, 2014 | Aug. 01, 2015 | Aug. 02, 2014 | |
Net income (loss) | $ (98) | $ 121.5 | $ (28.5) | $ 259.7 |
Foreign currency translation adjustments | (9.1) | 0.9 | (3.5) | 2.1 |
Total comprehensive income | $ (107.1) | $ 122.4 | $ (32) | $ 261.8 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) shares in Millions, $ in Millions | Aug. 01, 2015 | Jan. 31, 2015 | Aug. 02, 2014 |
Current assets: | |||
Cash and cash equivalents | $ 1,302.5 | $ 864.1 | $ 467.7 |
Short-term Investments | 4 | 0 | 0 |
Merchandise inventories, net | 2,825.1 | 1,035.7 | 1,084 |
Current deferred tax assets, net | 85.5 | 28.3 | 17.1 |
Other current assets | 307.6 | 66.5 | 94.4 |
Total current assets | 4,524.7 | 1,994.6 | 1,663.2 |
Property, plant and equipment, net | 3,151.9 | 1,210.5 | 1,153.4 |
Goodwill | 4,982.8 | 164.6 | 169.8 |
Deferred tax assets, net | 0 | 30.6 | 42.2 |
Finite-lived intangible asset, off-market lease, favorable, gross | 620.8 | 0.9 | 1.7 |
Other Intangible Assets, Net | 3,106.3 | 1.2 | 2.1 |
Other assets, net | 178.6 | 90.3 | 97.5 |
TOTAL ASSETS | 16,565.1 | 3,492.7 | 3,129.9 |
Current liabilities: | |||
Long-term Debt, Current Maturities | 83 | 0 | 0 |
Accounts payable | 1,152.5 | 433.6 | 524.2 |
Other current liabilities | 837.8 | 385.3 | 256.1 |
Income taxes payable | 0 | 42.7 | 2.7 |
Total current liabilities | 2,073.3 | 861.6 | 783 |
Long-term debt, excluding current portion | 8,265.5 | 682.7 | 740.2 |
Off-market Lease, unfavorable | 162.4 | 0 | 0 |
Income taxes payable, long-term | 1,655.1 | 0 | 0 |
Other liabilities | 361.8 | 163.4 | 158.6 |
Total liabilities | 12,518.1 | 1,707.7 | 1,681.8 |
Stockholders' Equity Attributable to Parent | 4,047 | 1,785 | 1,448.1 |
Shareholders' equity: | |||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 16,565.1 | $ 3,492.7 | $ 3,129.9 |
Common shares outstanding | 234.7 | 205.7 | 205.6 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Aug. 01, 2015 | Aug. 02, 2014 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (28.5) | $ 259.7 |
Adjustments to reconcile net income (loss) to net cash | ||
Depreciation and amortization | 142.3 | 100.6 |
Provision for deferred taxes | (17.6) | (16.2) |
Other non-cash adjustments to net income (loss) | 57.5 | 25.7 |
Changes in operating assets and liabilities | (199.4) | (4.5) |
Net cash provided by (used in) operating activities | (45.7) | 365.3 |
Cash flows from investing activities: | ||
Capital expenditures | (167) | (160.2) |
Increase in restricted cash | (12) | 0 |
Acquisition of Family Dollar, net of common stock issued and cash acquired | (6,525.6) | 0 |
Proceeds from (payments for) fixed asset disposition | (0.3) | 0.3 |
Net cash used in investing activities | (6,704.9) | (159.9) |
Cash flows from financing activities: | ||
Principal payments for long-term debt | (935.2) | (12.8) |
Proceeds from long-term debt | 8,200 | 0 |
Debt issuance costs | (88.9) | 0 |
Proceeds from stock issued pursuant to stock-based compensation plans | 3.9 | 3.3 |
Tax benefit of exercises/vesting of stock-based compensation | 10 | 3.6 |
Net cash provided by (used in) financing activities | 7,189.8 | (5.9) |
Effect of exchange rate changes on cash and cash equivalents | (0.8) | 0.5 |
Net increase in cash and cash equivalents | 438.4 | 200 |
Cash and cash equivalents at beginning of year | 864.1 | 267.7 |
Cash and cash equivalents at end of year | 1,302.5 | 467.7 |
Cash paid for: | ||
Interest | 206.7 | 16.9 |
Income taxes | 129.7 | 217.5 |
Non-cash transaction: | ||
Accrued capital expenditures | 50.9 | 21 |
Acquisition cost paid in common stock | $ 2,274.4 | $ 0 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Aug. 01, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements of Dollar Tree, Inc. and its wholly-owned subsidiaries (the "Company") have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and are presented in accordance with the requirements of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto and Management's Discussion and Analysis of Financial Condition and Results of Operations for the year ended January 31, 2015 contained in the Company's Annual Report on Form 10-K filed March 13, 2015 . The results of operations for the 13 and 26 weeks ended August 1, 2015 are not necessarily indicative of the results to be expected for the entire fiscal year ending January 30, 2016. In the Company's opinion, the unaudited condensed consolidated financial statements included herein contain all adjustments (including those of a normal recurring nature) considered necessary for a fair presentation of its financial position as of August 1, 2015 and August 2, 2014 and the results of its operations and cash flows for the periods presented. The January 31, 2015 balance sheet information was derived from the audited consolidated financial statements as of that date. On July 6, 2015 the Company acquired Family Dollar Stores, Inc. ("Family Dollar") for cash consideration of $6.8 billion and the issuance of 28.5 million shares of the Company's common stock valued at $2.3 billion based on the closing price of the Company's common stock on July 2, 2015 . The results of operations of Family Dollar are included in the Company's results of operations beginning on July 6, 2015 . Based on the manner in which the Company manages, evaluates and internally reports its operations, the Company determined that Family Dollar will be reported as a separate operating segment. See Notes 2 and 10 for additional details on the acquisition and the Company's segments. In the first quarter of 2015, the Company adopted Accounting Standards Update ("ASU") No. 2014-12, "Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could be Achieved after the Requisite Service Period." This update provides explicit accounting treatment with respect to share-based awards with specific performance targets for employees who are eligible to vest in the award regardless of whether the employee is rendering service on the date the performance target is achieved. This update has been adopted by the Company on a prospective basis for all awards granted or modified on or after February 1, 2015. The was no impact upon the adoption of the update. In the first quarter of 2015, the Company adopted ASU No. 2015-03, "Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs." Previously, debt issuance costs were recorded as assets on the balance sheet. This update requires that debt issuance costs related to a debt liability be presented on the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. This update does not change the recognition and measurement of debt issuance costs. The update has been adopted retrospectively for all periods presented in the accompanying Condensed Consolidated Balance Sheets. The reclassification of debt issuance costs resulted in reductions in "Other assets, net" and "Long-term debt, net" of $74.3 million and $16.7 million as of January 31, 2015 and August 2, 2014 , respectively. |
ACQUISTION
ACQUISTION | 6 Months Ended |
Aug. 01, 2015 | |
Business Combinations [Abstract] | |
ACQUISITION | ACQUISITION On July 27, 2014 , the Company executed an Agreement and Plan of Merger to acquire Family Dollar in a cash and stock transaction (the "Acquisition"). On July 6, 2015 (the "Acquisition Date") the Company completed the Acquisition and Family Dollar became a direct, wholly-owned subsidiary of the Company. Under the Acquisition, the Family Dollar shareholders received $59.60 in cash and 0.2484 shares of the Company's common stock for each share of Family Dollar common stock they owned, plus cash in lieu of fractional shares (the "Merger Consideration"). As of the Acquisition Date, each outstanding performance share right of Family Dollar common stock was canceled in exchange for the right of the holder to receive the Merger Consideration (the "PSR Payment"). The aggregate amount paid by the Company for the Merger Consideration and PSR Payment was $6.8 billion in cash and the Company issued 28.5 million shares of the Company's common stock, valued at $2.3 billion based on the closing price of the Company's common stock on July 2, 2015 . Additionally, outstanding Family Dollar stock options and restricted stock units were converted into mirror awards exercisable or to be earned in the Company's common stock. The value of these awards was apportioned between total Merger Consideration and unearned compensation to be recognized over the remaining original vesting periods of the awards. The Company's common stock continues to trade on the Nasdaq Exchange under the symbol "DLTR." Following the Acquisition Date, Family Dollar's common stock ceased trading on, and was delisted from, the New York Stock Exchange. Family Dollar's results from the Acquisition Date through August 1, 2015 are included in the Condensed Consolidated Statements of Operations. The following table summarizes the preliminary estimates of the fair values of the identifiable assets acquired and liabilities assumed in the Acquisition as of July 6, 2015 . The preliminary estimates of the fair value of identifiable assets acquired and liabilities assumed are subject to revisions, which may result in adjustments to the preliminary values presented below, when management's appraisals and estimates are finalized: (in millions) Cash $ 307.4 Short-term investments 4.0 Accounts receivable 71.4 Inventory 1,764.5 Other current assets 94.2 Property, plant and equipment 1,912.8 Goodwill 4,819.0 Intangible assets, net 3,570.3 Other assets 77.7 Long-term debt, including current portion (485.2 ) Accounts payable (633.4 ) Other current liabilities (550.4 ) Deferred tax liabilities, net (1,644.7 ) Other liabilities (202.2 ) Total purchase price $ 9,105.4 Less: Cash acquired (307.4 ) Total purchase price, net of cash acquired 8,798.0 Acquisition cost paid in common stock (2,272.4 ) Acquisition cost paid in cash $ 6,525.6 Goodwill is calculated as the excess of the purchase price over the net assets acquired. The goodwill recognized is attributable to growth opportunities and expected synergies. Intangible assets, net consist of three separately identified assets and one liability. First, the Company identified the Family Dollar tradename as an indefinite-lived intangible asset with a fair value of $3.1 billion . The tradename is not subject to amortization but will be evaluated annually for impairment. Second, the Company recognized an intangible asset of $629.3 million for favorable Family Dollar leases and a liability of $164.5 million for unfavorable Family Dollar leases (as compared to prevailing market rates) which will be amortized over the remaining lease terms, including, in some cases, an assumed renewal. Lastly, the Company recognized an intangible asset of $5.5 million for a customer list. The allocation of the purchase price to intangible assets as well as their estimated useful lives is preliminary and may be adjusted. The Company assumed the liability for Family Dollar's $185.2 million of private placement unsecured senior notes due September 27, 2015, Family Dollar's $300.0 million of 5% unsecured senior notes due February 1, 2021 and Family Dollar's unsecured revolving credit facilities. Following the Acquisition, the Company repaid the $185.2 million outstanding under the Family Dollar private placement unsecured senior notes and terminated the unsecured revolving credit facilities. The table above fully reflects the effect of the divestiture of 330 stores as required by purchase accounting as the divestiture was a condition of the Acquisition. Included in other current liabilities is approximately $91.4 million related to the transition of inventory and working capital associated with the divestiture. The results of operations of Family Dollar are included in the Company's results of operations beginning on July 6, 2015 . From July 6, 2015 through August 1, 2015 , Family Dollar generated net sales of $811.6 million and a net loss of $72.7 million . These results included: $60.0 million of inventory markdowns due to sku rationalization and planned liquidations; $24.1 million of expenses related to purchase accounting, primarily amortization of the step-up of the inventory value, amortization of intangible assets and higher depreciation expense; and $5.7 million of severance and integration costs. The following unaudited consolidated pro forma summary has been prepared by adjusting the Company's historical data to give effect to the Acquisition as if had occurred on February 2, 2014: Pro Forma - Unaudited (in millions, except per share data) 13 Weeks Ended August 1, 2015 13 Weeks Ended August 2, 2014 26 Weeks Ended August 1, 2015 26 Weeks Ended August 2, 2014 Net sales $ 4,931.2 $ 4,693.5 $ 9,857.7 $ 9,384.7 Net income $ 83.8 $ 139.1 $ 235.7 $ 286.7 Basic net income per share $ 0.36 $ 0.59 $ 1.00 $ 1.22 Diluted net income per share $ 0.36 $ 0.59 $ 1.00 $ 1.22 The unaudited consolidated pro forma financial information was prepared in accordance with existing standards and is not necessarily indicative of the results of operations that would have occurred if the Acquisition had been completed on the date indicated, nor is it indicative of the future operating results of the Company. Material non-recurring adjustments excluded from the pro forma financial information above consists of the step up of Family Dollar inventory to its fair value. The unfavorable adjustment to cost of goods sold of $11.1 million was based on the acquired inventory sold in the 13 and 26 weeks ended August 1, 2015, respectively. The unaudited pro forma results do not reflect events that either have occurred or may occur after the Acquisition, including, but not limited to, the anticipated realization of ongoing savings from operating synergies in subsequent periods. They also do not give effect to certain charges that the Company expects to incur in connection with the Acquisition, including, but not limited to, additional professional fees, employee integration, retention and severance costs, potential asset impairments, accelerated depreciation and amortization or product rationalization charges. The Company has incurred $28.0 million in acquisition-related expenses in 2015, excluding acquisition-related interest expense, of which $17.6 million was incurred in the 13 weeks ended August 1, 2015 . The Company also expended approximately $163.2 million in remaining capitalizable debt issuance costs related to the financing of the Acquisition and $158.5 million was included as a reduction in "Long-term debt, net" at August 1, 2015 . For additional discussion of the Acquisition, please see the "Acquisition" section included in "Part I. Financial Information, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations." of this Form 10-Q. |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Aug. 01, 2015 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Acquisition Notes On February 23, 2015 , a wholly-owned subsidiary of the Company (the "Escrow Issuer") completed the offering of $750.0 million aggregate principal amount of 5.25% senior notes due 2020 (the “2020 Notes”) and $2.5 billion aggregate principal amount of 5.75% senior notes due 2023 (the “2023 Notes”, and together with the 2020 Notes, the “Acquisition Notes”). The Acquisition Notes were offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and outside the United States, only to non-U.S. investors pursuant to Regulation S under the Securities Act. The Acquisition Notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent an effective registration statement or an applicable exemption from registration requirements or a transaction not subject to the registration requirements of the Securities Act or any state securities laws. The Company used the proceeds of the Acquisition Notes to finance in part the Acquisition. On the Acquisition Date, the Escrow Issuer merged with and into the Company and the Company assumed the obligations in respect of the Acquisition Notes. The Acquisition Notes are jointly and severally guaranteed on an unsecured, unsubordinated basis, subject to certain exceptions, by each of the Company’s subsidiaries which guarantees the obligations under the Company’s new senior secured credit facilities or certain other indebtedness, including Family Dollar and certain of its subsidiaries. The 2020 Notes, which mature on March 1, 2020 , were issued pursuant to an indenture, dated as of February 23, 2015 , with U.S. Bank National Association, as trustee (the “2020 Notes Indenture”). The 2023 Notes, which mature on March 1, 2023 , were issued pursuant to an indenture, dated as of February 23, 2015 , with U.S. Bank National Association, as trustee (the “2023 Notes Indenture”, and together with the 2020 Notes Indenture, the “Indentures”). Interest on the Acquisition Notes is due semiannually on March 1 and September 1, commencing on September 1, 2015. The Indentures contain covenants that limit the ability of the Company and certain of its subsidiaries to, among other things and subject to certain significant exceptions: (i) incur, assume or guarantee additional indebtedness; (ii) declare or pay dividends or make other distributions with respect to, or purchase or otherwise acquire or retire for value, equity interests; (iii) make any principal payment on, or redeem or repurchase, subordinated debt; (iv) make loans, advances or other investments; (v) incur liens; (vi) sell or otherwise dispose of assets, including capital stock of subsidiaries; (vii) consolidate or merge with or into, or sell all or substantially all assets to, another person; and (viii) enter into transactions with affiliates. The Indentures also provide for certain events of default, which, if any of them occurs, would permit or require the principal, premium, if any, interest and any other monetary obligations on all the then outstanding Acquisition Notes under the applicable indenture to be declared immediately due and payable. Credit Facility and Term Loans On March 9, 2015 , the Escrow Issuer entered into a credit agreement, with JPMorgan Chase Bank, N.A., as administrative agent, providing for $6.2 billion in senior secured credit facilities (the “New Senior Secured Credit Facilities”) consisting of a $1.25 billion revolving credit facility (the “New Revolving Credit Facility”) and $4.95 billion of term loan facilities (the “New Term Loan Facilities”). The New Term Loan Facilities consist of a $1.0 billion Term Loan A tranche and a $3.95 billion Term Loan B tranche. The New Revolving Credit Facility and the borrowings under the Term Loan A tranche will mature five years after the Acquisition Date, unless any of the 2020 Notes remain outstanding as of 91 days prior to their stated maturity, in which case the New Revolving Credit Facility and the borrowings under the Term Loan A tranche will mature at such time. The borrowings under the Term Loan B tranche will mature seven years after the Acquisition Date. The New Senior Secured Credit Facilities were not guaranteed by the Company or any of its subsidiaries prior to the consummation of the Acquisition, but upon and after the Acquisition Date, the New Senior Secured Credit Facilities are guaranteed by certain of the Company's direct or indirect wholly-owned U.S. subsidiaries, including Family Dollar and certain of its subsidiaries (collectively, the “Credit Agreement Guarantors”). Upon and after the Acquisition Date, the New Senior Secured Credit Facilities are secured by a security interest in substantially all of the assets of the Company and the Credit Agreement Guarantors, subject to certain exceptions. The proceeds of the borrowings under the Term Loan B tranche were deposited in an escrow account (separate from the escrow accounts related to the Acquisition Notes) and held in escrow until the Acquisition Date. Upon the consummation of the Acquisition, the Escrow Issuer merged with and into the Company, the Company became the borrower under the New Senior Secured Credit Facilities and drew the borrowings under the Term Loan A facility and the Company has the ability to borrow under the New Revolving Credit Facility. On June 11, 2015, the Escrow Issuer amended the terms of the New Senior Secured Credit Facilities to refinance the Term Loan B tranche with $3.3 billion of floating-rate Term B-1 Loans and $650.0 million of fixed-rate Term B-2 Loans. The loans under the Term Loan A tranche and the New Revolving Credit Facility will bear interest at LIBOR plus 2.25% per annum (or a base rate plus 1.25% ), the Term B-1 Loans of the New Senior Secured Credit Facilities will bear interest at LIBOR plus 2.75% per annum (or a base rate plus 1.75% ) and the Term B-2 Loans will bear interest at a fixed rate of 4.25% . The Term B-1 tranche will be subject to a “LIBOR floor” of 0.75% . The Term Loan A tranche of the New Term Loan Facilities will require quarterly amortization payments of 1.25% of the original principal amount thereof in the first year following the Acquisition Date, 2.5% of the original principal amount thereof in the second year following the Acquisition Date, and 3.75% of the original principal amount thereof thereafter. The Term B-1 Loans require quarterly amortization payments of 0.25% of the original principal amount thereof after the Acquisition Date and the Term B-2 Loans do not require amortization payments prior to maturity. The New Term Loan Facilities, excluding the Term B-2 Loans, also require mandatory prepayments in connection with certain asset sales and out of excess cash flow, among other things, and subject in each case to certain significant exceptions. The Company will pay certain commitment fees in connection with the New Revolving Credit Facility. Additionally, the Term B-1 Loans will require the Company to pay a 1.0% prepayment fee if the loans thereunder are subject to certain repricing transactions before June 11, 2016. The Term B-2 Loans will require the Company to pay a 2.0% prepayment fee if they are repaid in the second year after the refinance date and a 1.0% prepayment fee if they are repaid in the third year after the refinance date. The New Senior Secured Credit Facilities contain representations and warranties, events of default and affirmative and negative covenants. These include, among other things and subject to certain significant exceptions, restrictions on the Company's ability to declare or pay dividends, repay the Acquisition Notes, create liens, incur additional indebtedness, make investments, dispose of assets and merge or consolidate with any other person. In addition, a financial maintenance covenant based on the Company’s consolidated first lien secured net leverage ratio applies to the New Revolving Credit Facility and the Term Loan A tranche of the New Term Loan Facilities. Unsecured Senior Notes As a result of the Acquisition, the Company assumed the liability for $300 million of 5.0% unsecured senior notes due February 1, 2021 issued by Family Dollar on January 28, 2011 through a public offering. Senior Notes On the Acquisition Date, the Company prepaid in full $750.0 million in Senior Notes comprised of (i) $300.0 million in aggregate principal amount of 4.03% Series A Senior Notes due September 16, 2020, (ii) $350.0 million in aggregate principal amount of 4.63% Series B Senior Notes due September 16, 2023 and (iii) $ 100.0 million in aggregate principal amount of 4.78% Series C Senior Notes due September 16, 2025, issued pursuant to that certain Note Purchase Agreement, dated as of September 16, 2013 (as amended on January 20, 2015, the “Dollar Tree NPA”) among the Company, Dollar Tree Stores, Inc., and the Purchasers party thereto, plus accrued and unpaid interest thereon and a make-whole premium of approximately $89.5 million determined in accordance with the provisions of the Dollar Tree NPA plus additional interest in accordance with the provisions of the first amendment to the Dollar Tree NPA. Unsecured Credit Agreement On the Acquisition Date, the Company paid in full all amounts owing under the Unsecured Credit Agreement, dated as of June 6, 2012 and terminated all commitments to extend further credit thereunder. Long-term debt at August 1, 2015 and January 31, 2015, consisted of the following: As of August 1, 2015 As of January 31, 2015 (in millions) Principal Unamortized Debt Issuance Costs Principal Unamortized Discount and Debt Issuance Costs $750.0 million Senior Notes, fixed interest rates payable semi-annually, January 15 and July 15 $ — $ — $ 750.0 $ 3.3 $750.0 million Unsecured Credit Agreement, interest payable at LIBOR, plus 0.90%, which was 1.09% at August 1, 2015 — — — 0.9 $7.0 million Forgivable Promissory Notes, interest payable beginning in November 2017 at a rate of 1%, principal payable beginning November 2017 7.0 — 7.0 — 5.25% Acquisition Notes, due 2020 750.0 12.3 — 11.9 5.75% Acquisition Notes, due 2023 2,500.0 42.4 — 39.8 Term Loan A, interest payable at LIBOR, plus 2.25%, which was 2.44% at August 1, 2015 1,000.0 3.9 — 0.4 Term B-1 Loan, interest payable at the higher of LIBOR or 0.75% plus 2.75%, which was 3.50% at August 1, 2015. 3,300.0 64.7 — 8.2 $650.0 million Term B-2 Loan, fixed interest rate of 4.25% 650.0 12.7 — — $300.0 million Unsecured Senior Notes, fixed interest rate of 5.00% 300.0 — — — $1.25 billion Revolving Credit Facility, interest payable at LIBOR, plus 2.25%, which was 2.44% at August 1, 2015 — 22.5 — 9.8 Total $8,507.0 $158.5 $757.0 $74.3 |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Aug. 01, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Our effective tax rate was a benefit of 31.1% for the 13 weeks ended August 1, 2015 compared with expense of 38.2% for the 13 weeks ended August 2, 2014 and a benefit of 1.6% for the first half of 2015 compared with expense of 38.2% for the first half of 2014. This was as a result of the pre-tax losses in 2015 created by higher interest expense, including debt prepayment penalties and expenses related to the Acquisition. Some of the Acquisition-related costs were nondeductible for tax purposes. As of August 1, 2015 , the Company has an income tax receivable of $67.9 million compared to an income tax payable of $42.7 million as of January 31, 2015. The current year receivable is the result of the pre-tax loss reported in the 13 weeks ended August 1, 2015 . Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets and liabilities are classified on the accompanying consolidated balance sheets based on the classification of the underlying asset or liability. Significant components of the Company's net deferred tax assets (liabilities) follow: (in millions) August 1, January 31, Deferred tax assets: Deferred rent $ 43.5 $ 41.0 Accrued expenses 64.2 37.6 Net operating losses and credit carryforwards 49.9 31.0 Accrued compensation expense 63.2 33.8 Other 1.4 5.1 Total deferred tax assets 222.2 148.5 Valuation allowance (22.1 ) (13.8 ) Deferred tax assets, net 200.1 134.7 Deferred tax liabilities: Property and equipment (317.8 ) (48.7 ) Other intangibles (1,434.0 ) (18.7 ) Prepaid expenses (3.1 ) (3.0 ) Inventory (14.9 ) (5.4 ) Total deferred tax liabilities (1,769.8 ) (75.8 ) Net deferred tax asset (liability) $ (1,569.7 ) $ 58.9 Deferred tax liabilities have been provided for the tax effect of the difference between the book and tax basis in the assets. The increase in the deferred tax liability was primarily generated from the recording of the Family Dollar tradename, favorable lease rights, inventory and property plant and equipment. A valuation allowance of $22.1 million , net of federal tax benefits, has been provided principally for certain state credit carryforwards and net operating loss carryforwards. The increase in the valuation allowance is due to the Acquisition. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred taxes will not be realized. Based upon the availability of carrybacks of future deductible amounts to the past two years’ taxable income and the Company's projections for future taxable income over the periods in which the deferred tax assets are deductible, the Company believes it is more likely than not the remaining existing deductible temporary differences will reverse during periods in which carrybacks are available or in which the Company generates net taxable income. The Company is participating in the Internal Revenue Service (“IRS”) Compliance Assurance Program (“CAP”) for the 2015 fiscal year. This program accelerates the examination of key transactions with the goal of resolving any issues before the tax return is filed. Dollar Tree's federal tax returns have been examined and all issues have been settled through the fiscal 2013 tax year. The statute of limitations is still open for Family Dollar's tax returns for the fiscal year ended August 25, 2012 and forward. In general, fiscal years 2011 and forward are within the statute of limitations for state tax purposes. The statute of limitations is still open prior to 2011 for some states. The balance for unrecognized tax benefits at August 1, 2015, was $34.4 million . The total amount of unrecognized tax benefits at August 1, 2015, that, if recognized, would affect the effective tax rate was $24.4 million (net of the federal tax benefit). The following is a reconciliation of the Company’s total gross unrecognized tax benefits: August 1, 2015 January 31, 2015 Beginning Balance $ 6.5 $ 5.5 Additions, acquisition of Family Dollar 28.2 — Additions, based on tax positions related to current year 0.1 0.6 Additions for tax positions of prior years — 0.9 Reductions for tax positions of prior years — — Settlements — — Lapses in statutes of limitation (0.4 ) (0.5 ) Ending balance $ 34.4 $ 6.5 During fiscal 2015, the Company acquired Family Dollar Stores, Inc. The increase in unrecognized tax benefits for fiscal 2015 is primarily related to the Acquisition. United States income taxes have not been provided on accumulated but undistributed earnings of Dollar Tree’s foreign subsidiaries as the Company intends to permanently reinvest the earnings. To date, the earnings and related taxes of the legacy Dollar Tree foreign subsidiaries are negligible. The Company has provided United States income taxes on accumulated but undistributed earnings for Family Dollar’s foreign subsidiaries as of the July 6, 2015 acquisition date. |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 6 Months Ended |
Aug. 01, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | LEGAL PROCEEDINGS The Company is a defendant in legal proceedings including those described below and will vigorously defend itself in these matters. The Company does not believe that any of these matters will, individually or in the aggregate, have a material effect on its business or financial condition. The Company cannot give assurance, however, that one or more of these matters will not have a material effect on its results of operations for the periods in which they are resolved. The Company assesses its legal proceedings and reserves are established if a loss is probable and the amount of such loss can be reasonably estimated. Many if not substantially all of the contingencies described below are subject to significant uncertainties and, therefore, determining the likelihood of a loss and the measurement of any loss can be complex and subject to judgment. With respect to legal proceedings where the Company has determined that a loss is reasonably possible but not probable, the Company is unable to estimate the amount or range of reasonably possible loss due to the inherent difficulty of predicting the outcome of and uncertainties regarding legal proceedings. The Company’s assessments are based on estimates and assumptions that have been deemed reasonable by management, but that may prove to be incomplete or inaccurate, and unanticipated events and circumstances may occur that might cause the Company to change those estimates and assumptions. Management’s assessment of legal proceedings could change because of future determinations or the discovery of facts which are not presently known. Accordingly, the ultimate costs of resolving these proceedings may be substantially higher or lower than currently estimated. Dollar Tree Active Matters Winn-Dixie Stores instituted suit in a Florida federal court alleging that the Company sold products in certain stores in violation of a lease exclusive. In August 2012, the court denied Winn-Dixie's claim for damages. Winn-Dixie appealed to the U.S. Court of Appeals for the 11th Circuit, which affirmed that Winn-Dixie is not entitled to damages. However, it also held that Winn-Dixie's restriction for certain Florida stores required the Company to restrict its sales of food and "many household supplies." The 11th Circuit remanded the case for a new trial to determine the definition of "many household supplies" and other issues. The lower court decided these issues in April 2015. Dollar Tree has changed its operation of thirty Florida stores to comply with the court’s decision. Winn-Dixie has now appealed the decision. In 2011, an assistant store manager and an hourly associate filed a collective action against the Company alleging they were forced to work off the clock in violation of the Fair Labor Standards Act (“FLSA”) and state law. A federal judge in Virginia ruled that all claims made on behalf of assistant store managers under both the FLSA and state law should be dismissed. The court, however, certified an opt-in collective action under the FLSA on behalf of hourly sales associates. Approximately 4,300 plaintiffs remain in the case. The court denied the Company's motion to decertify the collective action as well as a proposed settlement. The case is now continuing. In 2013, a former assistant store manager on behalf of himself and others alleged to be similarly aggrieved filed a representative Private Attorney General Act ("PAGA") claim under California law currently pending in federal court in California. The suit alleges that the Company failed to provide uninterrupted meal periods and rest breaks; failed to pay minimum, regular and overtime wages; failed to maintain accurate time records and wage statements; and failed to pay wages due upon termination of employment. A trial date on the individual claim has been set for March 2016. In May 2014, a former assistant store manager filed a putative class action in a California state court for alleged failure to provide meal periods, overtime, timely payment of wages during employment and upon termination, failure to provide accurate wage statements, as well as for alleged failure to indemnify employees for business expenses in violation of California labor laws. Discovery has not commenced and no trial date has been set. In May 2014, the US Consumer Product Safety Commission ("CPSC") began a staff investigation of circumstances related to Letters of Advice that the Company received from the CPSC from 2009 to 2013. The CPSC is now investigating Letters of Advice the Company received in 2014 and 2015. It is possible for a penalty and an injunction to be issued against the Company. The outcome of this matter cannot be determined at this time. In April 2015, a distribution center employee filed a class action in California state court with allegations concerning wages, meal and rest breaks, recovery periods, wage statements and timely termination pay. Additionally, the employee seeks to certify a nation-wide class of non-exempt distribution employees for overtime compensation. The Company recently removed this lawsuit to Federal Court. In April 2015, a former store manager filed a class action in California state court alleging store managers were improperly classified as exempt employees and, among other things, did not receive overtime compensation and meal and rest periods and alleging PAGA claims. Family Dollar Active Matters In 2008, a Multi-District Litigation forum ("MDL") was created in North Carolina federal court to handle cases alleging FLSA violations against the Company. In the first two cases, the court entered orders finding the plaintiffs were not similarly situated and, therefore, neither nationwide notice nor collective treatment under the FLSA was appropriate. Since that time, the court has granted 60 summary judgments ruling Store Managers are properly classified as exempt from overtime. Presently, there are a total of 10 named plaintiffs in the remaining cases in the MDL, for which the North Carolina Federal Court has not decided the class certification or summary judgment issue. In 2008, a complaint was filed alleging discriminatory pay practices with respect to the Company's female store managers. This case was pled as a putative class action or collective action under applicable statutes on behalf of all Family Dollar female store managers. The plaintiffs seek recovery of back pay, compensatory and punitive money damages, recovery of attorneys' fees and equitable relief. The case was transferred to North Carolina Federal Court in November 2008. The parties are proceeding with limited discovery. The Company believes the case is fully insured. In 2013, plaintiffs filed a claim in Massachusetts state court seeking unpaid overtime for a class of current and former Massachusetts Store Managers whom plaintiffs claim are not properly classified as exempt from overtime under Massachusetts law. The Company then removed the case to Federal District court in Massachusetts. In 2014, the case was remanded to state court. The Company has appealed the remand decision to the U.S. Court of Appeals for the First Circuit and is awaiting that court’s decision. In 2014, Winn-Dixie Stores instituted suit in a Florida state court alleging that the Company sold products in 57 stores in violation of a lease exclusive. Winn-Dixie seeks damages and injunctive relief limiting the sale of food and other items sold in the Company's stores at issue in the lawsuit. This case is scheduled to be tried in January 2016. In 2014, the Company was served with a putative class action in Missouri Federal Court alleging that customers received Short Message Service ("SMS") text message advertisements from the Company, without providing appropriate express written consent in violation of the Telephone Consumer Protection Act ("TCPA"), seeking all damages available under the TCPA, including statutory damages of $500 - $1,500 per willful violation. In 2014, a putative class action was filed in a California Federal Court by a former employee alleging that the Company had a policy of requiring employee bag checks while the employees were not clocked in for work. As a result of those actions, the employee alleges the Company violated California law by failing to provide meal periods and rest breaks, failing to pay regular and overtime wages for work performed off the clock, failing to provide accurate wage statements, failing timely to pay all final wages and by engaging in unfair competition. He has also alleges PAGA claims. While employed by the Company, the plaintiff agreed to arbitrate matters related to his employment. Accordingly, the Company filed a motion to compel arbitration and is awaiting the court’s ruling on that motion. In 2014, a former employee brought a putative class action and asserted claims under PAGA alleging the Company failed to provide suitable seating to its California store employees. Mediation has been scheduled for September 23, 2015. In the meantime, the case has been stayed pending a ruling by the California Supreme Court on a case in which the court is expected to provide guidance as to what the Company’s obligations are with regard to suitable seating. In 2015, a lawsuit was brought as a collective action in Florida Federal Court on behalf of the plaintiff and other similarly situated Family Dollar store managers alleging the store managers are misclassified as being exempt from overtime under the FLSA. The Company then filed a Motion to Dismiss, or in the alternative to Stay the Case, a Motion to Compel Arbitration, and a Motion to Strike the Collective Action Allegations. Briefing is completed on these motions and they are currently pending before the court. Resolved Matters In 2012, a former assistant store manager, on behalf of himself and those alleged to be similarly situated, filed a putative class action in a California state court, alleging the Company failed to provide rest breaks to assistant store managers. The class was decertified in July 2015 and the case has now been resolved. In 2013, district attorneys in California initiated an investigation of whether the Company properly disposed of certain damaged retail products under Federal and California state environmental law, primarily the Resource Conservation and Recovery Act. The Company has settled this matter in 2015 and has fully paid the settlement amount. In 2014, several shareholders of Family Dollar filed class actions, now consolidated into one class action, in Delaware chancery court against Family Dollar’s CEO and board members alleging breach of fiduciary duty. Dollar Tree and Family Dollar were also named as defendants for allegedly aiding and abetting the other defendants. The Delaware Chancery Court and appellate court refused to issue an injunction against the Family Dollar shareholder vote in favor of the merger. The case was dismissed in August 2015 and was settled for an immaterial amount. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Aug. 01, 2015 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Company's cash and cash equivalents, short-term investments, restricted investments and diesel fuel swaps represent the financial assets and liabilities that were accounted for at fair value on a recurring basis as of August 1, 2015 . As required, financial assets and liabilities are classified in the fair value hierarchy in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. The fair value of the Company's cash and cash equivalents was $1,302.5 million and $467.7 million , at August 1, 2015 and August 2, 2014 , respectively. The fair value of the Company's short-term investments was $4.0 million at August 1, 2015 and the value of the Company's restricted investments was $122.0 million and $87.9 million , at August 1, 2015 and August 2, 2014 , respectively. The fair value of $88.0 and $87.9 million of the Company's restricted investments as of August 1, 2015 and August 2, 2014, respectively were determined using Level 1 measurements in the fair value hierarchy. The fair value of the Company's short-term investments and $34.0 million of restricted investments as of August 1, 2015 were estimated using Level 2 measurements in the fair value hierarchy. The fair values of the diesel fuel swaps were a liability of $3.5 million as of August 1, 2015 and a liability of less than $0.1 million as of August 2, 2014 and were estimated using Level 2 measurements in the fair value hierarchy, which used discounted cash flow calculations based upon diesel fuel cost curves. The estimated fair value of the Company’s long-term debt was $8.7 billion as of August 1, 2015 . The fair value of the Company's Acquisition Notes, Term Loans and Unsecured Senior Notes are determined using Level 1 inputs as quoted prices in active markets for identical assets or liabilities are available. The estimated fair value of the Company’s long-term debt was $723.9 million as of August 2, 2014 . The fair value of the Senior Notes was determined through the use of a discounted cash flow analysis using Level 3 inputs as there were no quoted prices in active markets for these notes. The discount rate used in the analysis was based on borrowing rates available to the Company for debt of the same remaining maturities, issued in the same private placement debt market. The carrying value of the Company's Revolving Credit Agreement at August 1, 2015 and the Company's Revolving Credit Agreement at August 2, 2014 approximated their fair values because the interest rates vary with market interest rates. Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). The Company did not record any significant impairment charges during the 13 or 26 weeks ended August 1, 2015 . |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 6 Months Ended |
Aug. 01, 2015 | |
Earnings Per Share [Abstract] | |
NET INCOME PER SHARE | NET INCOME (LOSS) PER SHARE The following table sets forth the calculations of basic and diluted net income (loss) per share: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions, except per share data) 2015 2014 2015 2014 Basic net income (loss) per share: Net income (loss) $ (98.0 ) $ 121.5 $ (28.5 ) $ 259.7 Weighted average number of shares outstanding 214.3 205.8 210.3 206.3 Basic net income (loss) per share $ (0.46 ) $ 0.59 $ (0.14 ) $ 1.26 Diluted net income (loss) per share: Net income (loss) $ (98.0 ) $ 121.5 $ (28.5 ) $ 259.7 Weighted average number of shares outstanding 214.3 205.8 210.3 206.3 Dilutive effect of stock options and restricted stock (as determined by applying the treasury stock method) — 0.8 — 0.9 Weighted average number of shares and dilutive potential shares outstanding 214.3 206.6 210.3 207.2 Diluted net income (loss) per share $ (0.46 ) $ 0.59 $ (0.14 ) $ 1.25 For the 13 and 26 weeks ended August 2, 2014 , substantially all of the stock options outstanding were included in the calculation of the weighted average number of shares and dilutive potential shares outstanding. As a result of the net losses for the 13 and 26 weeks ended August 1, 2015 , diluted net income (loss) per share excludes the impact of stock options and restricted stock (as determined by applying the treasury stock method) because the effect would be anti-dilutive. |
STOCK-BASED COMPENSATION PLAN
STOCK-BASED COMPENSATION PLAN | 6 Months Ended |
Aug. 01, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION PLAN | STOCK-BASED COMPENSATION The Company's stock-based compensation expense primarily includes the fair value of restricted stock units (RSUs) and employees' purchase rights under the Company's Employee Stock Purchase Plan. Stock-based compensation expense was $9.2 million and $27.8 million during the 13 and 26 weeks ended August 1, 2015 , respectively. Stock-based compensation expense was $7.2 million and $23.9 million during the 13 and 26 weeks ended and August 2, 2014 , respectively. In connection with the Acquisition, options to purchase Family Dollar common stock (“Family Dollar Options”) that were outstanding prior to the Acquisition were converted into options to purchase, on the same substantive terms and conditions as were applicable to Family Dollar Options, a number of shares of common stock of the Company determined by multiplying the number of shares of Family Dollar common stock subject to such Family Dollar Options by 1.0000 (the “Award Exchange Ratio”), at an exercise price per share equal to the per share exercise price for the shares of Family Dollar common stock otherwise purchasable pursuant to the Family Dollar Options divided by the Award Exchange Ratio. The Company converted approximately 1.5 million Family Dollar Options into options to purchase Dollar Tree Common Stock or into unvested options to purchase Dollar Tree Common Stock and recognized $1.0 million of expense related to these options in each of the 13 and 26 weeks ended August 1, 2015 . Stock options are valued using the Black-Scholes option-pricing model and compensation cost is recognized on a straight-line basis, net of estimated forfeitures, over the requisite service period. In connection with the Acquisition, unvested Family Dollar RSUs that were outstanding prior to the Acquisition were converted into unvested Dollar Tree RSUs with the same substantive terms and conditions as were applicable to the Family Dollar RSUs, in respect of a number of shares of common stock of the Company determined by multiplying the number of shares of Family Dollar RSUs by the Award Exchange Ratio. The Company converted approximately 0.1 million unvested Family Dollar RSUs into unvested Dollar Tree RSUs and recognized $0.5 million of expense related to these RSUs in each of the 13 and 26 weeks ended August 1, 2015 . The Company granted approximately 0.3 million service-based RSUs from the Omnibus Incentive Plan (Omnibus Plan) to employees and officers in the 26 weeks ended August 1, 2015 . The estimated $28.6 million fair value of these RSUs is being expensed ratably over the three-year vesting periods, or a shorter period based on the retirement eligibility of certain grantees. The fair value was determined using the Company's closing stock price on the date of grant. The Company recognized $2.2 million and $6.9 million of expense related to these RSUs during the 13 and 26 weeks ended August 1, 2015 . In the 26 weeks ended August 1, 2015 the Company granted 0.1 million RSUs with a fair value of $11.3 million from the Omnibus Plan to certain officers of the Company, contingent on the Company meeting certain performance targets in fiscal 2015. If the Company meets these performance targets in fiscal 2015, the RSUs will vest ratably over three years. The estimated fair value of these RSUs is being expensed ratably over the three-year vesting periods, or a shorter period based on the retirement eligibility of certain grantees. The Company recognized $0.6 million and $7.4 million of expense related to these RSUs in the 13 and 26 weeks ended August 1, 2015 . In the 26 weeks ended August 1, 2015 the Company granted RSUs with a fair value of $2.1 million from the Omnibus Plan to certain officers of the Company, contingent on the Company meeting certain performance targets for the period beginning on February 1, 2015 and ending on February 3, 2018 . Provided the vesting conditions are satisfied, the awards will vest at the end of the performance period. The estimated fair value of these RSUs is being expensed ratably over the three-year vesting period, or a shorter period based on the retirement eligibility of certain grantees. The Company recognized $0.1 million and $1.1 million of expense related to these RSUs in the 13 and 26 weeks ended August 1, 2015 . In March 2013, the Company granted RSUs ("2013 Grants") with a fair value of $1.4 million from the Omnibus Plan to certain officers of the Company, contingent on the Company meeting certain performance targets for the period beginning on February 3, 2013 and ending on January 30, 2016 ("2013 Goal"). However, because the Acquisition was not yet contemplated as of the grant date, the 2013 Goal did not exclude costs related to the Acquisition or any income that may be attributable to Family Dollar during the performance period. In the 26 weeks ended August 1, 2015 , the Company concluded that maintaining the 2013 Grants in their original form would undermine the Company's goals and create skewed incentives for the grantees. Because amending the 2013 Goal would have jeopardized deductibility of the awards under Section 162(m) of the Internal Revenue Service Code, in the 26 weeks ended August 1, 2015 , the Compensation Committee of the Board of Directors canceled the 2013 Grants and approved new awards (“2015 Supplemental Grants”), with a fair value of $2.2 million and a new operating income goal for the one-year period ending January 30, 2016 (“2015 Supplemental Goal”). The 2015 Supplemental Goal equals the amount remaining in the final year of the 2013 Goal, giving credit for actual Company performance utilizing an operating income definition that excludes both costs related to the Acquisition and income from Family Dollar. As such, the 2015 Supplemental Grants exactly replicate the incentive structure of the 2013 Grants had those awards excluded the effect of the then-unknown and unforeseeable Acquisition when they were granted. The Company recognized a $1.2 million reduction of expense related to the 2013 Grants cancellation in the 26 weeks ended August 1, 2015 and $0.3 million and $1.9 million of expense related to the 2015 Supplemental Grants in the 13 and 26 weeks ended August 1, 2015 . The Company recognized $4.4 million and $10.1 million of expense related to RSUs granted prior to fiscal 2015 in the 13 and 26 weeks ended August 1, 2015 . For the 13 and 26 weeks ended August 2, 2014 , the Company recognized $4.1 million and $9.8 million of expense related to these RSUs. In the 26 weeks ended August 1, 2015 , approximately 0.7 million RSUs vested and approximately 0.4 million shares, net of taxes, were issued. During the 26 weeks ended August 2, 2014 , approximately 0.8 million RSUs vested and approximately 0.5 million shares, net of taxes, were issued. In the 13 weeks ended August 1, 2015 less than 0.1 million RSUs vested. Less than 0.1 million RSUs vested in the 13 weeks ended August 2, 2014. |
FUEL DERIVATIVE CONTRACTS
FUEL DERIVATIVE CONTRACTS | 6 Months Ended |
Aug. 01, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
FUEL DERIVATIVE CONTRACTS | FUEL DERIVATIVE CONTRACTS In order to manage fluctuations in cash flows resulting from changes in diesel fuel costs, the Company entered into fuel derivative contracts with third parties. The Company has entered into fuel derivative contracts for 3.3 million gallons of diesel fuel, or approximately 37% of the Dollar Tree segment's domestic truckload fuel needs from August 2015 through January 2016 . Under these contracts, the Company pays the third party a fixed price for diesel fuel and receives variable diesel fuel prices at amounts approximating current diesel fuel costs, thereby creating the economic equivalent of a fixed-rate obligation. These derivative contracts do not qualify for hedge accounting and therefore all changes in fair value for these derivatives are included in “Other (income) expense, net” on the accompanying condensed consolidated statements of operations. |
SEGMENTS
SEGMENTS | 6 Months Ended |
Aug. 01, 2015 | |
Segment Reporting [Abstract] | |
SEGMENTS | SEGMENTS The Company operates a chain of more than 13,800 retail discount stores in 48 states and five Canadian provinces. The Company's operations are conducted in two reporting business segments: Dollar Tree and Family Dollar. The Company defines its segments as those operations whose results its chief operating decision maker ("CODM") regularly reviews to analyze performance and allocate resources. The results of operations of Family Dollar are included in the Company's results of operations beginning on July 6, 2015 . The Dollar Tree segment is the leading operator of discount variety stores offering merchandise at the fixed price of $1.00 . The Dollar Tree segment includes the Company's operations under the "Dollar Tree," "Deals" and "Dollar Tree Canada" brands, ten distribution centers and a Store Support Center in Chesapeake, Virginia. The Family Dollar segment operates a chain of general merchandise retail discount stores providing consumers with a selection of competitively priced merchandise in convenient neighborhood stores. The Family Dollar segment consists of the Company's operations under the "Family Dollar" brand, eleven distribution centers and a Store Support Center in Matthews, North Carolina. The Company measures the results of its segments using, among other measures, each segment's net sales, gross profit and operating income (loss). The Company may revise the measurement of each segment's operating income (loss), including the allocation of distribution center and Store Support Center costs, as determined by the information regularly reviewed by the CODM. When the measurement of a segment changes, previous period amounts and balances are reclassified to be comparable to the current period's presentation. Net sales by segment are as follows: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions) 2015 2014 2015 2014 Net sales: Dollar Tree $ 2,199.6 $ 2,031.1 $ 4,376.2 $ 4,031.4 Family Dollar 811.6 — 811.6 — Net sales $ 3,011.2 $ 2,031.1 $ 5,187.8 $ 4,031.4 Gross profit by segment is as follows: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions) 2015 2014 2015 2014 Gross profit: Dollar Tree $ 749.3 $ 694.1 $ 1,498.2 $ 1,390.7 Family Dollar 105.9 — 105.9 — Gross profit $ 855.2 $ 694.1 $ 1,604.1 $ 1,390.7 Operating income (loss) by segment is as follows: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions) 2015 2014 2015 2014 Operating income (loss): Dollar Tree $ 218.4 $ 205.0 $ 451.3 $ 436.9 Family Dollar (95.0 ) — (95.0 ) — Operating income $ 123.4 $ 205.0 $ 356.3 $ 436.9 Total assets by segment are as follows: As of August 1, January 31, August 2, (in millions) 2015 2015 2014 Total assets: Dollar Tree $ 3,800.8 $ 3,492.7 $ 3,129.9 Family Dollar 12,764.3 — — Total assets $ 16,565.1 $ 3,492.7 $ 3,129.9 |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Aug. 01, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Pronouncements | In the first quarter of 2015, the Company adopted Accounting Standards Update ("ASU") No. 2014-12, "Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could be Achieved after the Requisite Service Period." This update provides explicit accounting treatment with respect to share-based awards with specific performance targets for employees who are eligible to vest in the award regardless of whether the employee is rendering service on the date the performance target is achieved. This update has been adopted by the Company on a prospective basis for all awards granted or modified on or after February 1, 2015. The was no impact upon the adoption of the update. In the first quarter of 2015, the Company adopted ASU No. 2015-03, "Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs." Previously, debt issuance costs were recorded as assets on the balance sheet. This update requires that debt issuance costs related to a debt liability be presented on the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. This update does not change the recognition and measurement of debt issuance costs. The update has been adopted retrospectively for all periods presented in the accompanying Condensed Consolidated Balance Sheets. The reclassification of debt issuance costs resulted in reductions in "Other assets, net" and "Long-term debt, net" of $74.3 million and $16.7 million as of January 31, 2015 and August 2, 2014 , respectively. |
ACQUISITON (Tables)
ACQUISITON (Tables) | 6 Months Ended |
Aug. 01, 2015 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The preliminary estimates of the fair value of identifiable assets acquired and liabilities assumed are subject to revisions, which may result in adjustments to the preliminary values presented below, when management's appraisals and estimates are finalized: (in millions) Cash $ 307.4 Short-term investments 4.0 Accounts receivable 71.4 Inventory 1,764.5 Other current assets 94.2 Property, plant and equipment 1,912.8 Goodwill 4,819.0 Intangible assets, net 3,570.3 Other assets 77.7 Long-term debt, including current portion (485.2 ) Accounts payable (633.4 ) Other current liabilities (550.4 ) Deferred tax liabilities, net (1,644.7 ) Other liabilities (202.2 ) Total purchase price $ 9,105.4 Less: Cash acquired (307.4 ) Total purchase price, net of cash acquired 8,798.0 Acquisition cost paid in common stock (2,272.4 ) Acquisition cost paid in cash $ 6,525.6 |
Business Acquisition, Pro Forma Information | The following unaudited consolidated pro forma summary has been prepared by adjusting the Company's historical data to give effect to the Acquisition as if had occurred on February 2, 2014: Pro Forma - Unaudited (in millions, except per share data) 13 Weeks Ended August 1, 2015 13 Weeks Ended August 2, 2014 26 Weeks Ended August 1, 2015 26 Weeks Ended August 2, 2014 Net sales $ 4,931.2 $ 4,693.5 $ 9,857.7 $ 9,384.7 Net income $ 83.8 $ 139.1 $ 235.7 $ 286.7 Basic net income per share $ 0.36 $ 0.59 $ 1.00 $ 1.22 Diluted net income per share $ 0.36 $ 0.59 $ 1.00 $ 1.22 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Aug. 01, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt at August 1, 2015 and January 31, 2015, consisted of the following: As of August 1, 2015 As of January 31, 2015 (in millions) Principal Unamortized Debt Issuance Costs Principal Unamortized Discount and Debt Issuance Costs $750.0 million Senior Notes, fixed interest rates payable semi-annually, January 15 and July 15 $ — $ — $ 750.0 $ 3.3 $750.0 million Unsecured Credit Agreement, interest payable at LIBOR, plus 0.90%, which was 1.09% at August 1, 2015 — — — 0.9 $7.0 million Forgivable Promissory Notes, interest payable beginning in November 2017 at a rate of 1%, principal payable beginning November 2017 7.0 — 7.0 — 5.25% Acquisition Notes, due 2020 750.0 12.3 — 11.9 5.75% Acquisition Notes, due 2023 2,500.0 42.4 — 39.8 Term Loan A, interest payable at LIBOR, plus 2.25%, which was 2.44% at August 1, 2015 1,000.0 3.9 — 0.4 Term B-1 Loan, interest payable at the higher of LIBOR or 0.75% plus 2.75%, which was 3.50% at August 1, 2015. 3,300.0 64.7 — 8.2 $650.0 million Term B-2 Loan, fixed interest rate of 4.25% 650.0 12.7 — — $300.0 million Unsecured Senior Notes, fixed interest rate of 5.00% 300.0 — — — $1.25 billion Revolving Credit Facility, interest payable at LIBOR, plus 2.25%, which was 2.44% at August 1, 2015 — 22.5 — 9.8 Total $8,507.0 $158.5 $757.0 $74.3 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Aug. 01, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company's net deferred tax assets (liabilities) follow: (in millions) August 1, January 31, Deferred tax assets: Deferred rent $ 43.5 $ 41.0 Accrued expenses 64.2 37.6 Net operating losses and credit carryforwards 49.9 31.0 Accrued compensation expense 63.2 33.8 Other 1.4 5.1 Total deferred tax assets 222.2 148.5 Valuation allowance (22.1 ) (13.8 ) Deferred tax assets, net 200.1 134.7 Deferred tax liabilities: Property and equipment (317.8 ) (48.7 ) Other intangibles (1,434.0 ) (18.7 ) Prepaid expenses (3.1 ) (3.0 ) Inventory (14.9 ) (5.4 ) Total deferred tax liabilities (1,769.8 ) (75.8 ) Net deferred tax asset (liability) $ (1,569.7 ) $ 58.9 |
Reconciliation of Unrecognized Tax Benefits | The following is a reconciliation of the Company’s total gross unrecognized tax benefits: August 1, 2015 January 31, 2015 Beginning Balance $ 6.5 $ 5.5 Additions, acquisition of Family Dollar 28.2 — Additions, based on tax positions related to current year 0.1 0.6 Additions for tax positions of prior years — 0.9 Reductions for tax positions of prior years — — Settlements — — Lapses in statutes of limitation (0.4 ) (0.5 ) Ending balance $ 34.4 $ 6.5 During fiscal 2015, the Company acquired Family Dollar Stores, Inc. The increase in unrecognized tax benefits for fiscal 2015 is primarily related to the Acquisition. United States income taxes have not been provided on accumulated but undistributed earnings of Dollar Tree’s foreign subsidiaries as the Company intends to permanently reinvest the earnings. To date, the earnings and related taxes of the legacy Dollar Tree foreign subsidiaries are negligible. The Company has provided United States income taxes on accumulated but undistributed earnings for Family Dollar’s foreign subsidiaries as of the July 6, 2015 acquisition date. |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 6 Months Ended |
Aug. 01, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the calculations of basic and diluted net income (loss) per share: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions, except per share data) 2015 2014 2015 2014 Basic net income (loss) per share: Net income (loss) $ (98.0 ) $ 121.5 $ (28.5 ) $ 259.7 Weighted average number of shares outstanding 214.3 205.8 210.3 206.3 Basic net income (loss) per share $ (0.46 ) $ 0.59 $ (0.14 ) $ 1.26 Diluted net income (loss) per share: Net income (loss) $ (98.0 ) $ 121.5 $ (28.5 ) $ 259.7 Weighted average number of shares outstanding 214.3 205.8 210.3 206.3 Dilutive effect of stock options and restricted stock (as determined by applying the treasury stock method) — 0.8 — 0.9 Weighted average number of shares and dilutive potential shares outstanding 214.3 206.6 210.3 207.2 Diluted net income (loss) per share $ (0.46 ) $ 0.59 $ (0.14 ) $ 1.25 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 6 Months Ended |
Aug. 01, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Net sales by segment are as follows: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions) 2015 2014 2015 2014 Net sales: Dollar Tree $ 2,199.6 $ 2,031.1 $ 4,376.2 $ 4,031.4 Family Dollar 811.6 — 811.6 — Net sales $ 3,011.2 $ 2,031.1 $ 5,187.8 $ 4,031.4 Total assets by segment are as follows: As of August 1, January 31, August 2, (in millions) 2015 2015 2014 Total assets: Dollar Tree $ 3,800.8 $ 3,492.7 $ 3,129.9 Family Dollar 12,764.3 — — Total assets $ 16,565.1 $ 3,492.7 $ 3,129.9 Gross profit by segment is as follows: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions) 2015 2014 2015 2014 Gross profit: Dollar Tree $ 749.3 $ 694.1 $ 1,498.2 $ 1,390.7 Family Dollar 105.9 — 105.9 — Gross profit $ 855.2 $ 694.1 $ 1,604.1 $ 1,390.7 Operating income (loss) by segment is as follows: 13 Weeks Ended 26 Weeks Ended August 1, August 2, August 1, August 2, (in millions) 2015 2014 2015 2014 Operating income (loss): Dollar Tree $ 218.4 $ 205.0 $ 451.3 $ 436.9 Family Dollar (95.0 ) — (95.0 ) — Operating income $ 123.4 $ 205.0 $ 356.3 $ 436.9 |
BASIS OF PRESENTATION (Acquisit
BASIS OF PRESENTATION (Acquisition) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |
Aug. 01, 2015 | Aug. 01, 2015 | Aug. 02, 2014 | |
Business Acquisition [Line Items] | |||
Acquisition cost paid in common stock | $ 2,274.4 | $ 0 | |
Family Dollar | |||
Business Acquisition [Line Items] | |||
Payments to acquire business | $ 6,525.6 | $ 6,800 | |
Number of shares issued in business acquisition | 28.5 | 28.5 | |
Acquisition cost paid in common stock | $ (2,272.4) | $ 2,300 |
BASIS OF PRESENTATION (Company
BASIS OF PRESENTATION (Company Adopted Accounting Standards Update) (Details) - USD ($) $ in Millions | Jan. 31, 2015 | Aug. 02, 2014 |
Other assets | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Deferred finance costs, net | $ 74.3 | |
Long-term debt, net | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Deferred finance costs, net | $ 16.7 |
ACQUISITON (Narrative) (Details
ACQUISITON (Narrative) (Details) $ / shares in Units, $ in Millions | Jul. 06, 2015USD ($)$ / sharesshares | Aug. 01, 2015USD ($) | Aug. 01, 2015USD ($)shares | Aug. 02, 2014USD ($) | Aug. 01, 2015USD ($)shares | Aug. 02, 2014USD ($) | Jan. 31, 2015USD ($) |
Business Acquisition [Line Items] | |||||||
Finite-lived intangible asset, off-market lease, favorable, gross | $ 620.8 | $ 620.8 | $ 1.7 | $ 620.8 | $ 1.7 | $ 0.9 | |
Off-market Lease, unfavorable | 162.4 | 162.4 | 0 | 162.4 | 0 | 0 | |
Other current liabilities | 837.8 | 837.8 | 256.1 | 837.8 | 256.1 | $ 385.3 | |
Net sales | 3,011.2 | 2,031.1 | 5,187.8 | 4,031.4 | |||
Net income (loss) | (98) | 121.5 | (28.5) | 259.7 | |||
Inventory Write-down | 60 | ||||||
Purchase accounting adjustments | 24.1 | ||||||
Severance and integration costs | 5.7 | ||||||
Adjustment to cost of goods sold | (2,156) | $ (1,337) | $ (3,583.7) | $ (2,640.7) | |||
Fair Value Adjustment to Inventory | |||||||
Business Acquisition [Line Items] | |||||||
Adjustment to cost of goods sold | 11.1 | ||||||
Family Dollar | |||||||
Business Acquisition [Line Items] | |||||||
Business acquisition price per share (usd per share) | $ / shares | $ 59.60 | ||||||
Payments to acquire business | $ 6,800 | ||||||
Number of shares issued in business acquisition | shares | 28,500,000 | 28,500,000 | |||||
Acquisition cost paid in common stock | $ 2,300 | ||||||
Indefinite-lived intangible assets acquired | $ 3,100 | ||||||
Finite-lived intangible asset, off-market lease, favorable, gross | 629.3 | ||||||
Off-market Lease, unfavorable | 164.5 | ||||||
Finite-lived intangible assets acquired | 5.5 | ||||||
Long-term debt, including current portion | $ 485.2 | ||||||
Number of stores required for divestiture | 330 | ||||||
Other current liabilities | $ 91.4 | ||||||
Net sales | 811.6 | ||||||
Net income (loss) | 72.7 | ||||||
Business Combination, Acquisition Related Costs | $ 28 | ||||||
Business combination, acquisition-related interest expense | 17.6 | ||||||
Debt Issuance Cost | 163.2 | ||||||
Deferred Finance Costs, Noncurrent, Gross | $ 158.5 | $ 158.5 | $ 158.5 | ||||
Family Dollar | Minimum | Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Conversion of stock (shares) | shares | 0.2484 | ||||||
Family Dollar | Private Placement | |||||||
Business Acquisition [Line Items] | |||||||
Long-term Debt | $ 185.2 | ||||||
Family Dollar | Senior Notes | |||||||
Business Acquisition [Line Items] | |||||||
Long-term debt, including current portion | $ 300 | ||||||
Stated percentage | 5.00% |
ACQUISITON (Recognizable Identi
ACQUISITON (Recognizable Identifiable Assets Acquire) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2015 | Aug. 01, 2015 | Aug. 02, 2014 | Jul. 06, 2015 | Jan. 31, 2015 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract] | |||||
Goodwill | $ 4,982.8 | $ 4,982.8 | $ 169.8 | $ 164.6 | |
Acquisition cost paid in common stock | (2,274.4) | $ 0 | |||
Family Dollar | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract] | |||||
Cash | $ 307.4 | ||||
Short-term investments | 4 | ||||
Accounts receivable | 71.4 | ||||
Inventory | 1,764.5 | ||||
Other current assets | 94.2 | ||||
Property, plant and equipment | 1,912.8 | ||||
Goodwill | 4,819 | ||||
Intangible assets, net | 3,570.3 | ||||
Other assets | 77.7 | ||||
Long-term debt, including current portion | (485.2) | ||||
Accounts payable | (633.4) | ||||
Other current liabilities | (550.4) | ||||
Deferred tax liabilities, net | (1,644.7) | ||||
Other liabilities | (202.2) | ||||
Total purchase price | $ 9,105.4 | ||||
Less: Cash acquired | (307.4) | ||||
Total purchase price, net of cash acquired | 8,798 | ||||
Acquisition cost paid in common stock | 2,272.4 | (2,300) | |||
Payments to Acquire Businesses, Gross | $ 6,525.6 | $ 6,800 |
ACQUISITON (Pro Forma Informati
ACQUISITON (Pro Forma Information) (Details) - Family Dollar - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2015 | Aug. 02, 2014 | Aug. 01, 2015 | Aug. 02, 2014 | |
Business Acquisition [Line Items] | ||||
Net sales | $ 4,931.2 | $ 4,693.5 | $ 9,857.7 | $ 9,384.7 |
Net income | $ 83.8 | $ 139.1 | $ 235.7 | $ 286.7 |
Basic net income per share (usd per share) | $ 0.36 | $ 0.59 | $ 1 | $ 1.22 |
Diluted net income per share (usd per share) | $ 0.36 | $ 0.59 | $ 1 | $ 1.22 |
LONG-TERM DEBT (Narrative) (Det
LONG-TERM DEBT (Narrative) (Details) - USD ($) $ in Millions | 6 Months Ended | |||||
Aug. 01, 2015 | Jul. 06, 2015 | Jun. 11, 2015 | Mar. 09, 2015 | Feb. 23, 2015 | Jan. 31, 2015 | |
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 8,507 | $ 757 | ||||
Unsecured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 0 | 0 | ||||
Unsecured Debt | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 1.09% | |||||
Basis spread on variable rate | 0.90% | |||||
Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 0 | 750 | ||||
Senior notes prepayment | $ 750 | |||||
Make whole premium | $ 89.5 | |||||
Senior Notes | 5.25% Acquisition Notes, due 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 750 | $ 750 | 0 | |||
Stated percentage | 4.03% | 5.25% | ||||
Senior notes prepayment | $ 300 | |||||
Senior Notes | 5.25% Acquisition Notes, due 2020 | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 5.25% | |||||
Senior Notes | 5.75% Acquisition Notes, due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 2,500 | $ 2,500 | 0 | |||
Stated percentage | 4.63% | 5.75% | ||||
Senior notes prepayment | $ 350 | |||||
Senior Notes | 5.75% Acquisition Notes, due 2023 | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 5.75% | |||||
Senior Notes | 4.78% Series C Notes due 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Stated percentage | 4.78% | |||||
Senior notes prepayment | $ 100 | |||||
Line of Credit | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 0 | 0 | ||||
Line of Credit | LIBOR | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 2.44% | |||||
Basis spread on variable rate | 2.25% | |||||
Line of Credit | Senior Secured Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 6,200 | |||||
Line of Credit | Senior Secured Credit Facilities | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 1,250 | |||||
Term Loans | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Stated percentage | 2.75% | 2.25% | ||||
Base rate plus interest per annum | 1.75% | 1.25% | ||||
Long-term debt fixed interest rate | 4.25% | |||||
Quarterly Amortization Payments Percentage of Original Principal Amount Year One | 1.25% | |||||
Quarterly Amortization Payments Percentage of Original Principal Amount Year Two | 2.50% | |||||
Quarterly Amortization Payments Percentage of Original Principal Amount Beyond Year Two | 3.75% | |||||
Quarterly Amortization Payments of Original Principal Amount after Closing | 0.25% | |||||
Prepayment fee if loans subject to certain repricing transactions | 1.00% | |||||
Prepayment fee second year | 2.00% | |||||
Prepayment fee third year | 1.00% | |||||
Term Loans | Term Loan B-1 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 3,300 | $ 3,950 | 0 | |||
Senior secured credit facilities | $ 3,300 | |||||
Term Loans | Term Loan B-1 | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 3.50% | |||||
Term Loans | Term Loan B-1 | LIBOR | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 0.75% | |||||
Term Loans | Term Loan B-1 | LIBOR | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.75% | |||||
Term Loans | Term Loan B-2 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 650 | 0 | ||||
Senior secured credit facilities | $ 650 | |||||
Term Loans | Term Loan B-2 | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 4.25% | |||||
Term Loans | Senior Secured Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | 4,950 | |||||
Term Loans | Term Loan A | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 1,000 | $ 1,000 | 0 | |||
Term Loans | Term Loan A | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 2.44% | |||||
Basis spread on variable rate | 2.25% | |||||
Forgivable Promissory Notes | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 7 | 7 | ||||
Forgivable Promissory Notes | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 1.00% | |||||
Unsecured Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 300 | $ 0 | ||||
Stated percentage | 5.00% | |||||
Long-term debt, including current portion | $ 300 | |||||
Unsecured Senior Notes | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Effective percentage | 5.00% |
LONG-TERM DEBT (Schedule of Lon
LONG-TERM DEBT (Schedule of Long-term Debt) (Details) - USD ($) $ in Millions | 6 Months Ended | |||
Aug. 01, 2015 | Mar. 09, 2015 | Feb. 23, 2015 | Jan. 31, 2015 | |
Debt Instrument [Line Items] | ||||
Long-term debt | $ 8,507 | $ 757 | ||
Unamortized Discount and Debt Issuance Costs | 158.5 | 74.3 | ||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | 0 | 750 | ||
Unamortized Discount and Debt Issuance Costs | 0 | 3.3 | ||
Senior Notes | 5.25% Acquisition Notes, due 2020 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | 750 | $ 750 | 0 | |
Unamortized Discount and Debt Issuance Costs | $ 12.3 | 11.9 | ||
Senior Notes | 5.25% Acquisition Notes, due 2020 | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Effective percentage | 5.25% | |||
Senior Notes | 5.75% Acquisition Notes, due 2023 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 2,500 | $ 2,500 | 0 | |
Unamortized Discount and Debt Issuance Costs | $ 42.4 | 39.8 | ||
Senior Notes | 5.75% Acquisition Notes, due 2023 | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Effective percentage | 5.75% | |||
Unsecured Debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 0 | 0 | ||
Unamortized Discount and Debt Issuance Costs | $ 0 | 0.9 | ||
Unsecured Debt | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.90% | |||
Effective percentage | 1.09% | |||
Forgivable Promissory Notes | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 7 | 7 | ||
Unamortized Discount and Debt Issuance Costs | $ 0 | 0 | ||
Forgivable Promissory Notes | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Effective percentage | 1.00% | |||
Term Loans | Term Loan A | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 1,000 | $ 1,000 | 0 | |
Unamortized Discount and Debt Issuance Costs | $ 3.9 | 0.4 | ||
Term Loans | Term Loan A | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.25% | |||
Effective percentage | 2.44% | |||
Term Loans | Term Loan B-1 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 3,300 | $ 3,950 | 0 | |
Unamortized Discount and Debt Issuance Costs | $ 64.7 | 8.2 | ||
Term Loans | Term Loan B-1 | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Effective percentage | 3.50% | |||
Term Loans | Term Loan B-1 | LIBOR | Minimum | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.75% | |||
Term Loans | Term Loan B-1 | LIBOR | Maximum | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.75% | |||
Term Loans | Term Loan B-2 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 650 | 0 | ||
Unamortized Discount and Debt Issuance Costs | $ 12.7 | 0 | ||
Term Loans | Term Loan B-2 | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Effective percentage | 4.25% | |||
Unsecured Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 300 | 0 | ||
Unamortized Discount and Debt Issuance Costs | $ 0 | 0 | ||
Unsecured Senior Notes | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Effective percentage | 5.00% | |||
Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 0 | 0 | ||
Unamortized Discount and Debt Issuance Costs | $ 22.5 | $ 9.8 | ||
Line of Credit | Revolving Credit Facility | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.25% | |||
Effective percentage | 2.44% |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Aug. 01, 2015 | Aug. 02, 2014 | Aug. 01, 2015 | Aug. 02, 2014 | Jan. 31, 2015 | Feb. 01, 2014 | |
Income Tax Disclosure [Abstract] | ||||||
Deferred Tax Assets, Valuation Allowance | $ 22.1 | $ 22.1 | ||||
Deferred Tax Assets, Tax Deferred Expense, Reserves and Accruals, Deferred Rent | $ 43.5 | $ 43.5 | $ 41 | |||
Effective Income Tax Rate (Benefit), Percent | (31.10%) | 38.20% | (1.60%) | 38.20% | ||
Income Taxes Receivable | $ 67.9 | $ 67.9 | ||||
Taxes Payable | 42.7 | |||||
Deferred Tax Assets, Tax Deferred Expense, Reserves and Accruals, Accrued Liabilities | 64.2 | 64.2 | 37.6 | |||
Deferred Tax Assets, Operating Loss Carryforwards | 49.9 | 49.9 | 31 | |||
Deferred Tax Assets, Tax Deferred Expense, Compensation and Benefits | 63.2 | 63.2 | 33.8 | |||
Deferred Tax Assets, Other | 1.4 | 1.4 | 5.1 | |||
Deferred Tax Assets, Gross | 222.2 | 222.2 | 148.5 | |||
Deferred Tax Assets, Valuation Allowance, Current | (22.1) | (22.1) | (13.8) | |||
Deferred Tax Assets, Net of Valuation Allowance | 200.1 | 200.1 | 134.7 | |||
Deferred Tax Liabilities, Property, Plant and Equipment | (317.8) | (317.8) | (48.7) | |||
Deferred Tax Liabilities, Intangible Assets | (1,434) | (1,434) | (18.7) | |||
Deferred Tax Liabilities, Prepaid Expenses | (3.1) | (3.1) | (3) | |||
Deferred Tax Liabilities, Inventory | (14.9) | (14.9) | (5.4) | |||
Deferred Tax Liabilities, Gross | (1,769.8) | (1,769.8) | (75.8) | |||
Deferred Tax Liabilities, Net | (1,569.7) | (1,569.7) | ||||
Deferred Tax Assets, Net | 58.9 | |||||
Unrecognized Tax Benefits | 34.4 | 34.4 | $ 6.5 | $ 5.5 | ||
Unrecognized Tax Benefits, Increase Resulting from Current Period Tax Positions | 0.1 | $ 0.6 | ||||
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | 0 | 0.9 | ||||
Unrecognized Tax Benefits, Decrease Resulting from Prior Period Tax Positions | 0 | 0 | ||||
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities | 0 | 0 | ||||
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | (0.4) | $ (0.5) | ||||
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | $ 24.4 | $ 24.4 |
LEGAL PROCEEDINGS (Narrative) (
LEGAL PROCEEDINGS (Narrative) (Details) - Aug. 01, 2015 | USD ($)plantiff | USD ($)locations | USD ($)plantiff |
Winn Dixie Exclusive Selling Rights Violations | |||
Loss Contingency [Abstract] | |||
Number of operating locations affected | locations | 30 | ||
Pending Or Threatened Litigation Multi State Litigation | |||
Loss Contingency [Abstract] | |||
Number of opt in plaintiffs | plantiff | 4,300 | ||
Family Dollar | Multi-District Litigation FLSA Violations | |||
Loss Contingency [Abstract] | |||
Summary judgments granted | 60 | ||
Number of plaintiffs | plantiff | 10 | ||
Family Dollar | Winn Dixie Exclusive Selling Rights Violations | |||
Loss Contingency [Abstract] | |||
Number of stores | 57 | ||
Family Dollar | Telephone Consumer Protection Act Violation | |||
Loss Contingency [Abstract] | |||
Damages sought, minimum | $ 500 | $ 500 | $ 500 |
Damages sought, maximum | $ 1,500 | $ 1,500 | $ 1,500 |
FAIR VALUE MEASUREMENTS Fair Va
FAIR VALUE MEASUREMENTS Fair Value Measurements (Details) - USD ($) $ in Millions | Aug. 01, 2015 | Jan. 31, 2015 | Aug. 02, 2014 |
Fair Value Disclosures [Abstract] | |||
Cash and Cash Equivalents, Fair Value Disclosure | $ 1,302.5 | $ 467.7 | |
Short-term Investments | 4 | $ 0 | 0 |
Restricted Investments Fair Value | 122 | 87.9 | |
Diesel Fuel Swaps Liability | 3.5 | 0.1 | |
Long-term Debt, Fair Value | $ 8,700 | $ 723.9 |
NET INCOME (LOSS) PER SHARE Sch
NET INCOME (LOSS) PER SHARE Schedule of Earnings per share, basic and diluted (table details) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2015 | Aug. 02, 2014 | Aug. 01, 2015 | Aug. 02, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $ (98) | $ 121.5 | $ (28.5) | $ 259.7 |
Weighted Average Number of Shares Outstanding (shares) | 214.3 | 205.8 | 210.3 | 206.3 |
Basic net income per share (usd per share) | $ (0.46) | $ 0.59 | $ (0.14) | $ 1.26 |
Incremental Common Shares Attributable to Share-based Payment Arrangements | 0 | 0.8 | 0 | 0.9 |
Weighted average number of shares and dilutive potential shares outstanding (shares) | 214.3 | 206.6 | 210.3 | 207.2 |
Diluted net income per share (usd per share) | $ (0.46) | $ 0.59 | $ (0.14) | $ 1.25 |
STOCK-BASED COMPENSATION (Narra
STOCK-BASED COMPENSATION (Narrative) (Details) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2015USD ($)shares | Aug. 02, 2014USD ($)shares | Aug. 01, 2015USD ($)shares | Aug. 02, 2014USD ($)shares | Mar. 22, 2013USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation expense | $ 9.2 | $ 7.2 | $ 27.8 | $ 23.9 | |
Compensation Expense | 1 | ||||
Family Dollar Options | Family Dollar | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award Exchange Ratio | 1 | ||||
Conversion of stock (shares) | shares | 1.5 | ||||
Compensation Expense | $ 1 | ||||
Service Based Awards | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock granted under service and performance awards (in shares) | shares | 0.3 | ||||
Compensation Expense | 2.2 | $ 6.9 | |||
Fair value | 28.6 | $ 28.6 | |||
Performance Shares | Omnibus Incentive Plan | Restricted Stock Units (RSUs) | Certain officers | Ratable Annual Vesting | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock granted under service and performance awards (in shares) | shares | 0.1 | ||||
Compensation Expense | 0.6 | $ 7.4 | |||
Fair value | 11.3 | 11.3 | |||
Performance And Service Based Awards | Omnibus Incentive Plan | Restricted Stock Units (RSUs) | Certain officers | Vesting at End of Performance Period | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation Expense | 0.1 | 1.1 | |||
Fair value | 2.1 | 2.1 | $ 1.4 | ||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation Expense | $ 4.4 | $ 4.1 | $ 10.1 | $ 9.8 | |
Vested (shares) | shares | 0.1 | 0.1 | 0.7 | 0.8 | |
Shares Issued in Period | shares | 0.4 | 0.5 | |||
Restricted Stock Units (RSUs) | Family Dollar | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Conversion of stock (shares) | shares | 0.1 | ||||
Compensation Expense | $ 0.5 | ||||
2013 LTPP REGRANT | Performance And Service Based Awards | Omnibus Incentive Plan | Restricted Stock Units (RSUs) | Certain officers | Vesting at End of Performance Period | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation Expense | $ 0.3 | 1.9 | |||
Fair value | $ 2.2 | 2.2 | |||
2013 ORIGINAL LTPP GRANT | Performance And Service Based Awards | Omnibus Incentive Plan | Restricted Stock Units (RSUs) | Certain officers | Vesting at End of Performance Period | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation Expense | $ 1.2 |
FUEL DERIVATIVE CONTRACTS Fair
FUEL DERIVATIVE CONTRACTS Fair value Fuel Derivative Contracts (Details) - Aug. 01, 2015 - Commodity Contract 1 - gal gal in Millions | Total |
Derivative [Line Items] | |
Nonmonetary notional amount (gallons of diesel) | 3.3 |
Diesel fuel need in derivative contracts (in hundredths) | 37.00% |
SEGMENTS (Details)
SEGMENTS (Details) | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2015USD ($) | Aug. 02, 2014USD ($) | Aug. 01, 2015USD ($) | Aug. 02, 2014USD ($) | Jan. 31, 2015USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of retail discount stores | 13,800 | ||||
Number of states stores operating in | 48 | ||||
Number of Canadian provinces | 5 | ||||
Number of reportable segments | 2 | ||||
Net sales | $ 3,011,200,000 | $ 2,031,100,000 | $ 5,187,800,000 | $ 4,031,400,000 | |
Gross Profit | 855,200,000 | 694,100,000 | 1,604,100,000 | 1,390,700,000 | |
Operating Income (Loss) | 123,400,000 | 205,000,000 | 356,300,000 | 436,900,000 | |
Assets | 16,565,100,000 | 3,129,900,000 | 16,565,100,000 | 3,129,900,000 | $ 3,492,700,000 |
Dollar Tree | |||||
Segment Reporting Information [Line Items] | |||||
Price Point | $ 1 | ||||
Number of distribution centers | 10 | ||||
Net sales | $ 2,199,600,000 | 2,031,100,000 | 4,376,200,000 | 4,031,400,000 | |
Gross Profit | 749,300,000 | 694,100,000 | 1,498,200,000 | 1,390,700,000 | |
Operating Income (Loss) | 218,400,000 | 205,000,000 | 451,300,000 | 436,900,000 | |
Assets | $ 3,800,800,000 | 3,129,900,000 | 3,800,800,000 | 3,129,900,000 | 3,492,700,000 |
Family Dollar | |||||
Segment Reporting Information [Line Items] | |||||
Number of distribution centers | 11 | ||||
Net sales | $ 811,600,000 | 0 | 811,600,000 | 0 | |
Gross Profit | 105,900,000 | 0 | 105,900,000 | 0 | |
Operating Income (Loss) | (95,000,000) | 0 | (95,000,000) | 0 | |
Assets | $ 12,764,300,000 | $ 0 | $ 12,764,300,000 | $ 0 | $ 0 |