What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-08-26 compared with 2021-05-27 · 84 added, 40 removed, 274 unchanged (31% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED INCOME STATEMENTS

13 Weeks Ended

May 1, May 2,

13 Weeks Ended 26 Weeks Ended

July 31, August 1, July 31, August 1,

(in millions, except per share data) 2021 2020 2021 2020

15 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

13 Weeks Ended

May 1, May 2,

13 Weeks Ended 26 Weeks Ended

July 31, August 1, July 31, August 1,

(in millions) 2021 2020 2021 2020

5 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions) May 1, 2021 January 30, 2021 May 2, 2020

(in millions) July 31, 2021 January 30, 2021 August 1, 2020

Current assets:

34 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

13 Weeks Ended May 1, 2021

13 Weeks Ended July 31, 2021

(in millions) Common

5 unchanged sentences

Earnings Shareholders'

Balance at May 1, 2021 231.8 $ 2.3 $ 1,885.0 $ ( 30.2 ) $ 5,554.2 $ 7,411.3

Net income — — — — 282.4 282.4

Total other comprehensive loss — — — ( 1.8 ) — ( 1.8 )

Issuance of stock under Employee Stock

Purchase Plan — — 2.1 — — 2.1

Exercise of stock options — — 0.5 — — 0.5

Stock-based compensation, net 0.1 — 17.2 — — 17.2

Repurchase of stock ( 7.0 ) ( 0.1 ) ( 699.9 ) — — ( 700.0 )

Balance at July 31, 2021 224.9 $ 2.2 $ 1,204.9 $ ( 32.0 ) $ 5,836.6 $ 7,011.7

26 Weeks Ended July 31, 2021

(in millions) Common

Shares Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Earnings Shareholders'

Balance at January 30, 2021 233.4 $ 2.3 $ 2,138.5 $ ( 35.2 ) $ 5,179.7 $ 7,285.3

6 unchanged sentences

Repurchase of stock ( 9.2 ) ( 0.1 ) ( 949.9 ) — — ( 950.0 )

Balance at July 31, 2021 224.9 $ 2.2 $ 1,204.9 $ ( 32.0 ) $ 5,836.6 $ 7,011.7

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

DOLLAR TREE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (cont.)

13 Weeks Ended August 1, 2020

(in millions) Common

Shares Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Earnings Shareholders'

Balance at May 2, 2020 237.2 $ 2.4 $ 2,480.6 $ ( 47.8 ) $ 4,085.4 $ 6,520.6

13 Weeks Ended May 2, 2020

Net income — — — — 261.5 261.5

Total other comprehensive income — — — 6.6 — 6.6

Issuance of stock under Employee Stock

Purchase Plan 0.1 — 2.1 — — 2.1

Stock-based compensation, net — — 22.8 — — 22.8

Balance at August 1, 2020 237.3 $ 2.4 $ 2,505.5 $ ( 41.2 ) $ 4,346.9 $ 6,813.6

26 Weeks Ended August 1, 2020

(in millions) Common

12 unchanged sentences

Stock-based compensation, net 0.4 — 39.3 — — 39.3

Balance at May 2, 2020 237.2 $ 2.4 $ 2,480.6 $ ( 47.8 ) $ 4,085.4 $ 6,520.6

Balance at August 1, 2020 237.3 $ 2.4 $ 2,505.5 $ ( 41.2 ) $ 4,346.9 $ 6,813.6

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

2 unchanged sentences

26 Weeks Ended

May 1, May 2,

July 31, August 1,

(in millions) 2021 2020

12 unchanged sentences

Proceeds from governmental grant 2.3 —

Payments for fixed asset disposition ( 0.2 ) ( 0.1 )

Proceeds from (payments for) fixed asset disposition 0.2 ( 2.8 )

Net cash used in investing activities ( 451.5 ) ( 471.1 )

2 unchanged sentences

Proceeds from revolving credit facility — 750.0

Repayments of revolving credit facility — ( 250.0 )

Proceeds from stock issued pursuant to stock-based compensation plans 6.6 11.8

3 unchanged sentences

Effect of exchange rate changes on cash, cash equivalents and restricted cash 0.3 ( 0.1 )

Net increase in cash, cash equivalents and restricted cash 57.2 1,216.0

Net increase (decrease) in cash, cash equivalents and restricted cash ( 695.9 ) 1,211.2

Cash, cash equivalents and restricted cash at beginning of period 1,463.6 586.0

17 unchanged sentences

The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in our Annual Report on Form 10-K for the year ended January 30, 2021.

The results of operations for the 13 weeks ended May 1, 2021 are not necessarily indicative of the results to be expected for the entire fiscal year ending January 29, 2022.

In our opinion, the unaudited condensed consolidated financial statements included herein contain all adjustments (including those of a normal recurring nature) considered necessary for a fair presentation of our financial position as of May 1, 2021 and May 2, 2020 and the results of our operations and cash flows for the periods presented.

The results of operations for the 13 and 26 weeks ended July 31, 2021 are not necessarily indicative of the results to be expected for the entire fiscal year ending January 29, 2022.

In our opinion, the unaudited condensed consolidated financial statements included herein contain all adjustments (including those of a normal recurring nature) considered necessary for a fair presentation of our financial position as of July 31, 2021 and August 1, 2020 and the results of our operations and cash flows for the periods presented.

The January 30, 2021 balance sheet information was derived from the audited consolidated financial statements as of that date.

Certain prior year amounts have been reclassified for consistency with the current year presentation.

Note 2 - Legal Proceedings

Note 2 - Commitments and Contingencies

Purchase Obligations

At July 31, 2021, we have commitments totaling $ 274.0 million related to agreements for ocean shipping contracts.

Contingencies

We are defendants in legal proceedings including the class, collective, representative and large cases described below as well as individual claims in arbitration.

14 unchanged sentences

These cases may allege violations such as failure to provide employees with compliant rest and meal breaks, suitable seating and overtime pay, reimburse business expenses, pay minimum wages for all time worked, provide accurate wage statements, and timely pay wages as well as other potential labor code violations.

Lawsuits have been filed against Dollar Tree, Family Dollar and our vendors alleging that personal talc powder products caused cancer.

Four lawsuits are pending against us and our vendors alleging that personal talc powder products caused cancer.

We do not believe the products we sold caused the illnesses.

We believe these lawsuits are insured and we are being indemnified by our third party vendors.

Our past talc lawsuits have been resolved without material loss to the company but no assurance can be given as to the outcome of pending or future cases.

Although we have indemnification rights against our vendors,

it is uncertain whether the vendors will have the financial ability to carry out their obligations.

It is also uncertain whether our insurers will deny coverage under our various policies.

Dollar Tree Resolved Matters

4 unchanged sentences

The legal claims include New York consumer protection laws, negligent misrepresentations, breach of warranties, fraud and unjust enrichment.

In late 2019 and early 2020, personal injury and consumer class actions were filed alleging that we sold Zantac containing N- Nitrosodimethylamine, which is classified by the FDA as a probable carcinogen.

Although all the suits were dismissed in December 2020, on February 8, 2021, an Amended Master Personal Injury Complaint was filed against us and other retailers, manufacturers, and distributors alleging unjust enrichment, physical harm, loss of consortium, and death.

In January and April 2021, state-wide consumer class actions were filed against us by the same law firm in Georgia and Alabama, respectively, for breach of warranty based on the allegation that the coffee we sold was mislabeled because the canisters did not contain enough coffee to make the number of cups of coffee stated on the label.

Please see the description above for talc and PAGA lawsuits against Family Dollar.

Family Dollar Resolved Matters

In late 2019 and early 2020, personal injury and consumer class actions were filed alleging that we sold Zantac containing a probable carcinogen.

The lawsuits were dismissed in June 2021.

The time for appealing the dismissal has not run.

Note 3 - Fair Value Measurements

4 unchanged sentences

that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (e.g., when there is evidence of impairment).

We did not record any significant impairment charges during the 13 weeks ended May 1, 2021 and May 2, 2020.

We did not record any significant impairment charges during the 13 or 26 weeks ended July 31, 2021 and August 1, 2020.

Fair Value of Financial Instruments

1 unchanged sentence

The aggregate fair values and carrying values of our long-term borrowings were as follows:

May 1, 2021 January 30, 2021 May 2, 2020

July 31, 2021 January 30, 2021 August 1, 2020

(in millions) Fair Value Carrying Value Fair Value Carrying Value Fair Value Carrying Value

4 unchanged sentences

The following table sets forth the calculations of basic and diluted net income per share:

13 Weeks Ended

May 1, May 2,

13 Weeks Ended 26 Weeks Ended

July 31, August 1, July 31, August 1,

(in millions, except per share data) 2021 2020 2021 2020

11 unchanged sentences

Diluted net income per share $ 1.23 $ 1.10 $ 2.83 $ 2.14

For the 13 weeks ended May 1, 2021 and May 2, 2020, substantially all of the stock options outstanding were included in the calculation of the weighted average number of shares and dilutive potential shares outstanding.

For the 13 and 26 weeks ended July 31, 2021 and August 1, 2020, substantially all of the stock options outstanding were included in the calculation of the weighted average number of shares and dilutive potential shares outstanding.

Note 5 - Stock-Based Compensation

For a discussion of our stock-based compensation plans, refer to “Note 11 - Stock-Based Compensation Plans” of our Annual Report on Form 10-K for the year ended January 30, 2021.

Stock-based compensation expense was $ 31.8 million and $ 32.6 million during the 13 weeks ended May 1, 2021 and May 2, 2020, respectively.

Stock-based compensation expense was $ 49.6 million and $ 55.7 million during the 26 weeks ended July 31, 2021 and August 1, 2020, respectively.

Restricted Stock

3 unchanged sentences

Service-Based RSUs

The following table summarizes the status of service-based RSUs as of May 1, 2021 and changes during the 13 weeks then ended:

The following table summarizes the status of service-based RSUs as of July 31, 2021 and changes during the 26 weeks then ended:

Number of Shares Weighted Average

3 unchanged sentences

Forfeited ( 81,686 ) 92.00

Nonvested at May 1, 2021 1,284,434 $ 93.83

The following table summarizes the status of PSUs as of May 1, 2021 and changes during the 13 weeks then ended:

Nonvested at July 31, 2021 1,222,047 $ 93.88

The following table summarizes the status of PSUs as of July 31, 2021 and changes during the 26 weeks then ended:

Number of Shares Weighted Average

3 unchanged sentences

Forfeited ( 40,300 ) 94.90

Nonvested at May 1, 2021 622,684 $ 91.82

Nonvested at July 31, 2021 621,602 $ 91.81

Note 6 - Shareholders’ Equity

We repurchased 2,150,572 shares of common stock on the open market for approximately $ 250.0 million during the 13 weeks ended May 1, 2021.

Approximately $ 8.7 million in share repurchases had not settled as of May 1, 2021.

This amount was accrued and is reflected in “Other current liabilities” within the accompanying unaudited condensed consolidated balance sheet as of May 1, 2021.

We did not repurchase any shares of common stock in the 13 weeks ended May 2, 2020.

As of May 1, 2021, we have $ 2.15 billion remaining under Board repurchase authorization.

We repurchased 7,006,326 and 9,156,898 shares of common stock on the open market for approximately $ 700.0 million and $ 950.0 million during the 13 and 26 weeks ended July 31, 2021, respectively.

Approximately $ 2.5 million in share repurchases had not settled as of July 31, 2021.

This amount was accrued and is reflected in “Other current liabilities” within the accompanying unaudited condensed consolidated balance sheet as of July 31, 2021.

We did not repurchase any shares of common stock in the 13 and 26 weeks ended August 1, 2020.

As of July 31, 2021, we have $ 1.45 billion remaining under Board repurchase authorization.

Note 7 - Segments and Disaggregated Revenue

15 unchanged sentences

Information for our segments, as well as for Corporate, support and Other, including the reconciliation to Income before income taxes, is as follows:

13 Weeks Ended

May 1, May 2,

13 Weeks Ended 26 Weeks Ended

July 31, August 1, July 31, August 1,

(in millions) 2021 2020 2021 2020

3 unchanged sentences

Consolidated Net sales $ 6,340.2 $ 6,277.6 $ 12,817.0 $ 12,564.4

13 Weeks Ended

May 1, May 2,

13 Weeks Ended 26 Weeks Ended

July 31, August 1, July 31, August 1,

(in millions) 2021 2020 2021 2020

12 unchanged sentences

Income before income taxes $ 369.2 $ 339.9 $ 856.1 $ 665.1

May 1, January 30, May 2,

July 31, January 30, August 1,

(in millions) 2021 2021 2020

10 unchanged sentences

The following table summarizes net sales by merchandise category for our segments:

13 Weeks Ended

May 1, May 2,

13 Weeks Ended 26 Weeks Ended

July 31, August 1, July 31, August 1,

(in millions) 2021 2020 2021 2020

13 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements