US: Family Dollar Q1 profit slides, lowers outlook
Family Dollar said it was affected by an “intensified” promotional environment
US discounter Family Dollar has booked a drop in first-quarter earnings and lowered its guidance for the full year.
In the three months to the end of November, net profit dropped to US$78m from $80.3m a year earlier.
Family Dollar said it was affected by an "intensified" promotional environment during the period, as well as a decline in customer transactions.
As a result, comparable store sales dropped 2.8%. Total sales increased 3.2% to $2.5bn from $2.4bn a year earlier.
Revenues were affected by a decreased in customer transactions and a slight decrease in the average customer transaction value.
While the top line was pressured, Family Dollar said it expanded gross margin in the period.
The company, however, lowered its earnings expectations for the full year and now expects earnings per diluted share of $3.25 to $3.55, compared with $3.83 in fiscal 2013, which was a 53-week year.
Separately, the company also announced a number of management changes. COO Michael Bloom has left to pursue other interests and a new search is being conducted. The firm has also promoted Jason Reiser, SVP of merchandising to the position of chief merchandising officer.
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