DOLLAR TREE STORES, INC. REPORTS EARNINGS PER SHARE OF $0.18 FOR THE THIRD
QUARTER ENDING SEPTEMBER 30, 1998
CHESAPEAKE, Virginia -- October 21, 1998 -- Dollar Tree Stores, Inc. (NASDAQ:
DLTR), the nation's leading $1.00 price point retailer, reported net earnings
for the quarter ended September 30, 1998, of $11.5 million on sales of $176.1
million, compared to net earnings of $8.7 million on sales of $142.4 million in
the third quarter of 1997. Earnings per share increased to $0.18 in the third
quarter of 1998 from $0.13 in the same period last year.
As previously reported, sales increased $33.7 million over sales for the
third quarter of 1997, and sales in comparable stores increased by 2.9%. Year to
date, sales increased $111.3 million over sales for the same period last year,
and sales in comparable stores increased by 6.8%.
Gross margin for the quarter increased to 38.7% of sales compared to 37.8%
for the same quarter last year. This increase is due primarily to improved
merchandise costs (including freight) and a reduction in shrink and markdown
costs. The improvement in merchandise costs is primarily due to favorable
pricing and the earlier receipt of import merchandise.
Operating expenses increased to 27.3% of net sales for the third quarter of
1998, compared to 27.2% for the third quarter of 1997. This increase resulted
from increased payroll, primarily due to the minimum wage increase in 1997, and
depreciation, offset by a general reduction in operating expenses resulting from
cost controls.
Year to date, net sales, earnings, and earnings per share in 1998 were
$500.8 million, $29.1 million and $0.45 per share, respectively, compared to net
sales, earnings, and earnings per share through the third quarter of 1997 of
$389.5 million, $18.3 million, and $0.28 per share, respectively.
Dollar Tree Stores, Inc. is a leading discount variety store chain offering
a wide assortment of quality everyday general merchandise, in many traditional
variety store categories, at the $1.00 price point. Dollar Tree Stores operates
1,054 stores in 29 states as of September 30, 1998, having added 75 new stores
and closed one store in the quarter, for a total of 171 new stores and four
closed stores in 1998.
CONTACT: Dollar Tree Stores, Inc.
Eric Coble or Erica Robb, 757/321-5000
DOLLAR TREE STORES, INC.
Condensed Consolidated Income Statements
For the Period Ended
September 30,
(Amounts in thousands, except per share data)
(Unaudited)
Third Quarter Year-To-Date
1998 1997 1998 1997
Net sales $176,071 $142,386 $500,769 $389,464
Cost of sales 107,915 88,550 312,927 248,173
Gross profit 68,156 53,836 187,842 141,291
38.7% 37.8% 37.5% 36.3%
SGA expenses 43,384 35,444 124,615 99,973
24.6% 24.9% 24.9% 25.7%
Depreciation/amortization 4,736 3,327 13,207 9,422
2.7% 2.3% 2.6% 2.4%
Interest expense 1,313 971 2,634 2,209
0.7% 0.7% 0.5% 0.6%
Earnings before
income taxes $ 18,723 $ 14,094 $ 47,386 $ 29,687
10.6% 9.9% 9.5% 7.6%
Income tax expense 7,208 5,425 18,243 11,428
Net earnings $ 11,515 $ 8,669 $ 29,143 $ 18,259
6.5% 6.1% 5.8% 4.7%
Earnings per share -
Basic $ 0.19 $ 0.15 $ 0.49 $ 0.31
Weighted average number
of shares 59,132 58,616 58,968 58,492
Earnings per share -
Diluted $ 0.18 $ 0.13 $ 0.45 $ 0.28
Weighted average number
of shares 65,391 64,831 65,213 64,569
DOLLAR TREE STORES, INC.
Condensed Consolidated Balance Sheets
(Amounts in thousands)
(Unaudited)
Sept. 30, Dec. 31, Sept. 30,
1998 1997 1997
Cash and cash equivalents $ 5,325 $ 43,695 $ 4,638
Merchandise inventories 184,511 89,066 133,150
Other current assets 13,782 10,261 7,815
Total current assets 203,618 143,022 145,603
Net property and equipment 108,364 82,071 70,581
Goodwill, net 43,033 44,478 44,960
Other assets, net 3,443 3,005 3,255
Total assets $ 358,458 $ 272,576 $ 264,399
Current portion of
long-term debt $ 32,100 $ 0 $ 12,500
Accounts payable and
accrued expenses 69,598 63,584 61,104
Income taxes payable 0 18,908 1,742
Current installments of
obligations under capital
leases 392 317 309
Total current liabilities 102,090 82,809 75,655
Long-term debt 57,900 30,000 60,000
Obligations under capital
leases, excluding current
installments 2,188 804 817
Other liabilities 4,072 4,037 3,798
Total liabilities 166,250 117,650 140,270
Shareholders' equity 192,208 154,926 124,129
Total liabilities and
shareholders' equity $ 358,458 $ 272,576 $ 264,399