Dollar Tree's profit, sales beat estimates

(Reuters) - Dollar Tree Inc , the biggest U.S. dollar-store chain, reported better-than-expected quarterly profit and sales on Wednesday, helped by lower costs and higher customer spending in its stores.

Shares of the retailer, which also owns the Family Dollar chain, rose 5 percent to $80.05 in premarket trading.

Dollar stores such as Dollar Tree and rival Dollar General Corp have expanded rapidly in recent years, taking market share from Wal-Mart Stores Inc and others, thanks to smaller store sizes, a wider variety of products and prices starting at $1.00.

However, Wal-Mart and peer Target Corp are fighting back and seeking to cut food prices. Target on Tuesday signaled it would rely more on low prices at the cost of margins to better compete with rivals.

Sales at Dollar Tree stores open for more than a year rose 2.3 percent on a constant-currency basis in the fourth quarter ended Jan. 28, slightly above the 2.1 percent that analysts polled by research firm Consensus Metrix had expected.

Net income rose to $321.8 million, or $1.36 per share, from $229 million, or 97 cents per share, a year earlier.

Net sales rose 5 percent to $5.64 billion, as more customers visited its stores and also spent more on average.

Analysts on average had expected earnings of $1.32 per share and revenue of $5.62 billion, according to Thomson Reuters I/B/E/S.

(Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Sai Sachin Ravikumar)

Must Read

Asian stocks drift pending fresh news; oil takes a breather

Aug 16, 2016

Asian stock markets drifted sideways on Tuesday as the price of oil took a breather from a three-day rally

US home construction climbed to a 6-month high in July

Aug 16, 2016

US home construction climbed to a 6-month high in July, led by a jump in apartment buildings

Asian stocks mostly higher after Wall Street decline

Aug 17, 2016

Asian stock markets were mostly higher Wednesday after Wall Street declined

Search

Obserworld delivers the most accurate and up-to-date world news for the global audience with a thorough research and in-depth interviews. Discover the world through Obserworld.

Contact us: sales[at]obserworld.com