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Dollar Tree shows Q2 profit

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CHESAPEAKE, Va. — Dollar Tree Inc. swung to a profit in its fiscal second quarter, reporting on Thursday net income of $170.2 million, or 72 cents a share, compared to a loss in the same period a year earlier.

Dollar-Tree-exterior-072814The earnings were in line with analysts’ forecasts for the company, the nation’s largest chain of dollar stores.

But Dollar Tree’s same-store sales were below forecasts, and the stock was down more than 7% in morning trading on Nasdaq. Same-store sales increased 1.2%, compared with a 2.7% increase a year ago. Analysts, on average, expected revenues to increase 2.6% in the period.

The retailer posted net sales of $5.0 billion in the quarter compared to $3.01 billion a year earlier. Five analysts surveyed by Zacks Investment Research were expecting quarterly revenue of $5.13 billion.

For the current quarter, Dollar Tree said it expects revenue in the range of $5.02 billion to $5.1 billion. The company expects full-year earnings to be between $3.67 per share and $3.82 per share, with revenue ranging from $20.69 billion to $20.87 billion.

Dollar Tree established itself as the nation’s largest discount retailer with the acquisition of larger rival Family Dollar Stores. Since closing on its Family Dollar purchase in July, Dollar Tree has worked to wring synergies from the union and improve the performance of the Family Dollar banner.


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