In a March 13th release, Dollar Tree, Inc. (DLTR) announced Q4 and FY 2023 results for the period ending February 3rd 2024. The holding company operates Dollar Tree and Family Dollar banners. Dollar Tree Inc. posted a net loss of $(1,710) million on total revenue of $8,640 million with a negative diluted EPS of $(7.85). During Q4 the Company recorded a $950 million impairment of goodwill and a $594 million charge for stores following a review of the portfolio. Comparable values for Q4 FY 2022 ending January 28th were net income of $452 million on revenue of $7,740 million with a diluted EPS of $2.04.
Comparing the respectivequarters, revenue was up 11.9 percent in Q4 2023. During the most recent quarter, Dollar Tree attained a gross margin of 32.2 percent (31.0 percent in Q4 FY 2022) and an operating margin of negative 21.9 percent, compared to 8.0 percent in Q4 2022.
For FY 2023 Dollar Tree Inc. posted a net loss of $(998) million on total revenue of $30,582 million with a negative diluted EPS of $(4.55). Comparable values for FY 2022 were net income of $721 million on revenue of $28,318 million with a diluted EPS of $7.21.
For Q4, consolidated comparable store sales, increased by 3.0 percent, with Dollar Tree achieving 6.3 percent and Family Dollar, 1.2 percent decline.
In commenting on results, Rick Dreiling, Chairman and CEO stated, “We finished the year strong, with fourth quarter results reflecting positive traffic trends, market share gains, and adjusted margin improvement across both segments,” Jeff Davis, CFO added, “As an organization, we continue to execute at a high level. Our core operating performance was strong in the fourth quarter, despite some unanticipated developments related to general liability claims.”
Guidance for FY 2024 included consolidated sales of $31,000 million to $32,000 million; a mid-single-digit percent increase in comparable store sales and an EPS ranging from $6.70 to $7.30.
Effective February 3rd 2024, Dollar Tree posted total assets of $22,023 million including $3,063 as goodwill and intangibles and carried long-term debt and lease obligations of $8,874 million. DLTR had a market capitalization of $2,793 million on March 20th. The share has traded over the past 52 weeks from $102.77 to $161.10 with a 50-day moving average of $138.91. DLTR closed at $149.88 on March 12th, pre-release, closing March 13th at $127.10, down 15.2 percent. Dollar Tree trades with a forward P/E of 19.0. For the trailing-12 months the company posted an operating margin of negative 9.9 percent and a profit margin of negative 3.3 percent. The company returned negative 0.5 percent on assets and negative 12.4 percent on equity over the past twelve months.
Effective February 3rd the company operated 16,622 stores (Dollar Tree, 8,272; Family Dollar 8,350). During Q4 the company continued renovations and added a a net 147 stores. The Company intends to close 600 stores in FY 2024. Responding to complaints from civic organizations Dollar Tree added frozen and fresh foods to additional stores during the previous quarter in areas deemed “food deserts”
In the investors’ call the company commented on theft as a headwind and announced preventive measures.