Family Dollar Boosts Second-Quarter Net 10.7 Percent
MATTHEWS, N.C.-Second-quarter net income for Family Dollar totaled $136.4 million, up 10.7 percent from the second quarter of last year.
The dollar-store retailer accomplished this growth primarily through an 8.6 percent rise in net sales, to $2.5 billion, which included a 4.5 percent gain in same-store sales. Howard Levine, Family Dollar's chairman and CEO, credited the company's investments to improve the shopping experience "and broaden our customer appeal." Levine said the same-store increase resulted from pickups in customer traffic and in the average customer transaction value.
Gross margin in the quarter, which ended on Feb. 25, dropped 80 basis points to 34.9 percent, declining due to a larger percentage of sales in low-margin consumables. Selling, general and administrative expenses, while rising 4.8 percent in dollars, decreased 94 basis points as a percentage of sales to 25.9 percent.
Looking ahead, Levine said Family Dollar would accelerate its investments "to become more relevant to a broader customer base." This will include expanding its assortment in key businesses and introducing new categories. For this fiscal year as a whole, Family Dollar has projected a net sales gain of from 9 to 10 percent, with an increase in same-store sales of from 5 to 6 percent.