Posted on 07/08/2009 6:39:16 PM PDT by Diana in Wisconsin
New York, NY (AHN) - Family Dollar Stores, Inc. (NYSE: FDO) on Wednesday swung to third quarter net income gain by almost 36 percent as more consumers looked for discounted products, topping analysts expectations. The retailer anticipates beating market expectations again in the current-quarter.
In the current quarter, "we are initiating efforts to re-align space in our stores to accommodate strong customer demand and improve the in-store shopping experience," Chairman and Chief Executive Officer Howard R. Levine said in a statement today.
"These investments will add incremental expense pressure in the fourth quarter but will position us to drive sustainable growth beyond the current quarter," he added.
For the fourth quarter, the company expects that net sales will increase to increase up to 6 percent with comparable store sales to rise between 2 percent and 4 percent.
Earnings per share will be between 39 cents and 43 cents in the fourth quarter, reflecting the anticipated impact from lower freight expense, lower inventory shrinkage and other investments.
For the fiscal year ending Aug. 29, the company expects that earnings per diluted share will be between $2.03 and $2.07 in fiscal 2009 as compared with $1.66 in fiscal 2008.
The market analysts on Wall Street are expecting income of 39 cents a share and are projecting a 4 percent rise in net sales to $1.83 billion.
"Customers are shopping us more frequently and relying on us to meet more of their basic needs. As a result, we continue to gain market share," Levine said.
"While we can't predict when the current environment will improve, the investments we are making to be more relevant to our customers and to improve the in-store experience position us well to meet our customers' evolving needs."
For the period ended May 30, net income increased 35.5 percent to $87.7 million compared with net income of $64.7 million for the third quarter of fiscal 2008.
Net sales were up to $1.84 billion, or 8.3 percent, in the third quarter of fiscal 2009, higher from $1.70 billion reported in the year-earlier period. Same-store sales rose 6.2 percent.
Economists expected the company to post earnings of 59 cents in the third quarter.
Gross margin, as a percentage of sales, was 36.2 percent in the third quarter compared to 34.6 percent, due to lower freight expense, lower inventory shrinkage and higher purchase mark-ups which more than offset stronger sales of lower-margin consumable merchandise.
During the quarter, the company repurchased around 1.2 million shares of its stock for $38.5 million. As of May 30, the company had authorization to purchase up to an additional $94.6 million of its stock.
The stock of the company was moving higher by $2.17 or 7.82 percent, to $29.92 in pre-market trading on Wednesday. Family Dollar has traded between $19.70 and $35.00 in the last 52-week period.
I read some comments from the CEO recently that as much as 40 per cent of FDO’s customers are on some form of public assistance.
That’s because they started carrying food and accepting EBT cards.
Yep. And as long as we stay in this 0bamaconomy free-fall, they’ll be rakin’ in the cash. :)
I shop at dollar stores from time to time. Can’t beat the prices on rice and beans. And I can AFFORD top-notch rice and beans...but why spend the money? I certainly don’t want to spend more than I have to, nor do I want to put one more dime in sales tax back into my state’s bottomless-pit coffers.
(Food isn’t taxed here, but I’m thinking states that don’t tax food are mulling it over as I type...)
Ping to a thread you may find interesting.
Heard it at dinner today. We may get a 200% bonus in October!
Woohoo! Glad to hear somebody outside of state government is doing well in NC, lol.
200% of what was not specified, but it beats a poke in the eye with a sharp stick, as my Dad says.
The place I work is in the same industrial park as a gigantic new Dollar General warehouse. I mean, this thing must be 250,000 square feet at minimum.
Many many trucks roll in and out of it, all day. And you know what? Quite a few of them carry the markings of a certain very well known mega-big-box nationwide retailer.
200% of agreed upon incentive pay, most likely. Just double the max bonus.
In this current, near-depressionary environment, that’s really doing something. Congrats.
Dollar General and Family Dollar are not the same. Family Dollar seems to be the superior one (though I bought a cheap grill at Dollar General because it had four legs instead of three) I love Family Dollar. I used to be brand specific on so many things, but have just naturally brought that down in the last few years. Certain food items are good for me - I especially like their brand of tea bags, tagless, 100 to a box for about a dollar. We use a lot, so it works out well. I will do others if I have to, but theirs are the best. Their prices on spices are incredible, litter and cat food, seeds, and some incidentals. After Kroger’s, my favorite place to shop. Here in North Little Rock, they’re in the same location, so I can carefully choose what I buy where.
Are there states that tax grocery items? Quite a regressive tax...
LOL! I shop at FDO every week - can’t pass up bargains on foods, cleaning supplies, light bulbs, and other household items. You don’t need to be on welfare to recognize good prices.
I should stop tomorrow and fill my eco-friendly bags with useless plastic objects.
When the bonus arrives, I’ll stimulate the economy by spending it!
Wow! Good for you!
My industry is doing really well this year, too. Garden Center. So many more people are growing their own these days, it’s been amazing. This is the best year the industry has had as a whole since the Y2K self-made panic. Sales of seed and everything that stems from that was up 30%.
Boss Lady put me in for a nice fat bonus, too. I deserve one after working 50+ hour weeks, January through June this year and not strangling one single customer, LOL! :)
I have no problems shopping at Wal-Mart, Walgreen’s or Dollar Store. Anyone can read a label to see where the items are made. Why so many rail against imports but can’t READ a freakin’ product label is beyond me, LOL!
I don’t buy a thing from China, and yet I can shop locally, put money back into my local economy and save money, too. :)
Seven states tax groceries at lower rates than other goods; they are Arkansas, Illinois, Missouri, Tennessee, Utah, Virginia, and West Virginia.
Five states — Hawaii, Idaho, Kansas, Oklahoma, and South Dakota— tax groceries fully but offer credits or rebates offsetting some of the taxes paid on food by some portions of the population. These credits or rebates usually are set at a flat amount per family member. The amounts and eligibility rules vary, but may be too narrow and/or insufficient to give eligible households full relief from sales taxes paid on food purchases.
Two states continue to apply their sales tax fully to food purchased for home consumption without providing any offsetting relief for low- and moderate-income families. They are Alabama and Mississippi.
http://www.cbpp.org/cms/?fa=view&id=1230
See post #17. I challenege you to beat my monthly grocery and H&B lists.
Not a thing purchased from overseas; not a thing beyond the basics. Most foodstuffs are purchased in season or as loss-leaders and most of my food comes from right within my very own state. I shop the sales and cook with what is local, available and cheap each week, year ‘round.
I’d be happy to help you if you have a hard time reading product labels or comparing prices per pound, etc. It CAN be kind of confusing and grocers and retailers ARE out to get the most money out of us as humanly possible. :)
I hope you enjoy your bonus! There’s always an upside to the downturn somewhere.
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