Family Dollar Q3 earnings slide on costs
- Q3 earnings drop to US$79.9m
- Gross margin widens to 34.6%
- Sales grow 2.6%
Family Dollar's Q3 was hit by merger-related costs
Family Dollar Stores saw its earning slide in the third quarter as it recorded charges related to its Dollar Tree merger and restructuring costs.
Net income amounted to US$79.9m in the three months to the end of May compared with $81.1m in the year ago period. Excluding $4.7m in merger-related expenses and $24.5m in restructuring charges, adjusted earnings reached $84.6m.
Gross margin widened slightly to 34.6% from 34.3% last year, primarily due to lower markdowns and higher merchandise markups, partially offset by increased sales of lower-margin consumables.
Total sales were up 2.6% to $2.73bn, while comparable store sales edged up 0.7% thanks to an increase in the number of customer transactions, which was partially offset by a drop in the average customer transaction value.
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