Dollar Tree Inc.’s stock fell 3.6% early Wednesday, after the retailer met earnings expectations for its fiscal first quarter but also disclosed a review of its Family Dollar business and losses stemming from tornado damage to a facility.
Chesapeake, Va.-based Dollar Tree had net income of $300.1 million, or $1.38 a share, for the quarter to May 4, up from $299.0 million, or $1.35 a share, in the year-earlier period.
Adjusted per-share earnings came to $1.43, matching the FactSet consensus. Revenue rose to $7.633 billion from $7.324 billion a year ago, compared with a FactSet consensus of $7.634 billion.
“At Dollar Tree we remain focused on rapidly rolling out our next generation of multi-price stores and at Family Dollar we are taking the steps necessary to position the business for long-term success,” CEO Rick Dreiling said in prepared remarks.
The company has launched a review of strategic options for Family Dollar, that could include a sale or spinoff of the business. It also said it has incurred losses of $117 million as of May 4 after a tornado destroyed a distribution center in Marietta, Oklahoma.
“Expected insurance recoveries for business interruption and redevelopment costs greater than the losses recognized cannot be estimated at this time,” the company said.
The stock has fallen 15% in the year to date, while the S&P 500 has gained 11%.
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