Dollar Tree said Thursday that sales and earnings increased for the fiscal first quarter, citing improvements in store traffic and average ticket.
Sales for the quarter, which ended May 3, increased by 7.2% to $2 billion. Net earnings of $183.3 million improved by 6.9%. The results were in-line with the previous forecast and analyst estimates.
In a conference call discussing results, Dollar Tree CEO Bob Sasser said higher-margin discretionary sales grew at a better rate than consumables during the quarter. Leading categories included candy, check-out products, stationery and seasonal merchandise for Valentines and Easter.
Sasser said the discounter was “doubling down” on emphasizing basics on the first of the month to maximize potential of the payroll cycle. “We’re reintroducing our ‘see what $20 buys’ along with our ‘stretch your dollar campaign’ through in-store promotions and digital media. And to satisfy basic needs and to drive increased shopping frequency, we continue to expand our frozen and refrigerated category,” he said.
Sasser said sales improved in April, as weather conditions improved. The chain cited winter weather as a factor in a missing earnings targets in the fourth quarter.
Dollar Tree opened 94 stores, closed 6 stores, and expanded or relocated 28 stores during the quarter, resulting in a 6.8% increase in selling square footage compared to a year ago.
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