Dollar Tree to open 650 new stores in 2017
Bob Sasser told analysts during an earnings conference call that the Virginia-based company plans to open at least 650 stores stores in 2017. He also said the retailer has added freezers and coolers to 86 Dollar Tree stores, bringing the total of Dollar Tree stores with fresh food to 4,788 stores.
Sasser called his discount stores "the most attractive sector in retail" citing rising traffic and sales, in contrast to other retail trends.
"There’s still much more to be done and we continue to believe we will ultimately surpass our three year target," Sasser said. "Our strategy is to deliver great values and convenience to our shoppers every day. With the combination of our complimentary brands, Dollar Tree and Family Dollar, we have on parallel of opportunity and value retail to serve more customers in our markets."
Sasser also discussed the Republican proposal in Congress to tax imports, which could affect the retailer's "everything is a dollar" business model. Sasser said he won't know the border tax's effects “until we know what, if anything, is passed.”
The company's expansion plans and Sasser's comments followed the release of fourth quarter results showing that sales Increased 5% to $5.64 billion. Same store sales increased 1.2% (Dollar Tree +2.3%, Family Dollar +0.2%). Diluted Earnings per share Increased 40.2% to $1.36 vs. $0.9 in the prior year.
For the year ending in January 2018, Dollar Tree estimates $4.20 to $4.56 a share in earnings on net sales of $21.94 billion to $22.33 billion. Analysts expected $4.49 a share in earnings on $21.89 billion in revenue.
"We believe we are extremely well positioned in the most attractive sector of retail to deliver increased value for our long-term shareholders," Sasser said. "Our Dollar Tree and Family Dollar banners are each focused on offering great value and convenience to our shoppers. With two great banners, we can effectively grow our store base and serve more customers across a broad geography and a diverse demographic population with the products they need and want. We have a resilient business model, a focused and energized leadership team, a lengthy runway for store growth, and tremendous opportunities to continue improving our businesses."
Dollar Tree operates 14,334 stores across 48 states and five Canadian provinces.