What changed in this filing

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Item 1. Financial Statements

2024-09-04 compared with 2024-06-05 · 103 added, 56 removed, 304 unchanged (34% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED INCOME STATEMENTS

13 Weeks Ended

(in millions, except per share data) May 4, 2024 April 29, 2023

13 Weeks Ended 26 Weeks Ended

(in millions, except per share data) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Net sales $ 7,372.7 $ 7,320.1 $ 14,999.1 $ 14,639.6

5 unchanged sentences

Interest expense, net 28.9 24.2 53.3 50.1

Other expense, net

Other (income) expense, net — ( 0.1 ) 0.1 —

Income before income taxes 174.2 263.7 570.3 657.4

6 unchanged sentences

Weighted average common shares outstanding:

215.0 220.1 216.4 220.6

215.2 220.5 216.7 221.1

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

13 Weeks Ended

(in millions) May 4, 2024 April 29, 2023

13 Weeks Ended 26 Weeks Ended

(in millions) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Net income $ 132.4 $ 200.4 $ 432.5 $ 499.4

4 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions) May 4, 2024 February 3, 2024 April 29, 2023

(in millions, except par value and share data) August 3, 2024 February 3, 2024 July 29, 2023

Current assets:

15 unchanged sentences

Current liabilities:

Short-term borrowings $ 249.8 $ — $ —

Current portion of long-term debt 1,000.0 — —

Current portion of operating lease liabilities 1,536.5 1,513.0 1,478.6

3 unchanged sentences

Total current liabilities 5,999.9 4,696.7 4,150.3

Long-term debt, net 3,427.5 3,426.3 3,422.7

Long-term debt, net, excluding current portion 2,428.7 3,426.3 3,423.9

Operating lease liabilities, long-term 5,582.6 5,447.6 5,447.8

17 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

13 Weeks Ended May 4, 2024

13 Weeks Ended August 3, 2024

(in millions) Common

5 unchanged sentences

Earnings Shareholders'

Balance at May 4, 2024

215.7 $ 2.2 $ — $ ( 45.6 ) $ 7,355.8 $ 7,312.4

Net income — — — — 132.4 132.4

Total other comprehensive loss — — — ( 3.4 ) — ( 3.4 )

Issuance of stock under Employee Stock

Purchase Plan 0.1 — 1.8 — — 1.8

Stock-based compensation, net — — 27.1 — — 27.1

Repurchase of stock ( 0.8 ) — ( 5.9 ) — ( 84.1 ) ( 90.0 )

Excise tax on repurchases of stock

— — ( 0.8 ) — — ( 0.8 )

Balance at August 3, 2024

215.0 $ 2.2 $ 22.2 $ ( 49.0 ) $ 7,404.1 $ 7,379.5

26 Weeks Ended August 3, 2024

(in millions) Common

Shares Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Earnings Shareholders'

Balance at February 3, 2024

9 unchanged sentences

— — ( 3.6 ) — — ( 3.6 )

Balance at May 4, 2024

Balance at August 3, 2024

215.0 $ 2.2 $ 22.2 $ ( 49.0 ) $ 7,404.1 $ 7,379.5

13 Weeks Ended April 29, 2023

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

DOLLAR TREE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (cont.)

13 Weeks Ended July 29, 2023

(in millions) Common

5 unchanged sentences

Earnings Shareholders'

Balance at April 29, 2023

220.6 $ 2.2 $ 519.5 $ ( 44.0 ) $ 8,422.0 $ 8,899.7

Net income — — — — 200.4 200.4

Total other comprehensive income — — — 3.9 — 3.9

Issuance of stock under Employee Stock

Purchase Plan — — 2.5 — — 2.5

Stock-based compensation, net — — 24.4 — — 24.4

Repurchase of stock ( 0.7 ) — ( 98.9 ) — — ( 98.9 )

Excise tax on repurchases of stock

— — ( 1.0 ) — — ( 1.0 )

Balance at July 29, 2023

219.9 $ 2.2 $ 446.5 $ ( 40.1 ) $ 8,622.4 $ 9,031.0

26 Weeks Ended July 29, 2023

(in millions) Common

Shares Common

Stock Additional

Capital Accumulated

Comprehensive

Loss Retained

Earnings Shareholders'

Balance at January 28, 2023

1 unchanged sentence

Net income — — — — 499.4 499.4

Total other comprehensive loss — — — ( 2.8 ) — ( 2.8 )

Total other comprehensive income — — — 1.1 — 1.1

Issuance of stock under Employee Stock

5 unchanged sentences

— — ( 2.0 ) — — ( 2.0 )

Balance at April 29, 2023

Balance at July 29, 2023

219.9 $ 2.2 $ 446.5 $ ( 40.1 ) $ 8,622.4 $ 9,031.0

3 unchanged sentences

26 Weeks Ended

(in millions) May 4, 2024 April 29, 2023

(in millions) August 3, 2024 July 29, 2023

Cash flows from operating activities:

8 unchanged sentences

Merchandise inventories ( 16.5 ) 120.5

Income taxes receivable — ( 22.0 )

Other current assets ( 39.3 ) ( 18.5 )

8 unchanged sentences

Capital expenditures ( 972.9 ) ( 775.8 )

Proceeds from insurance recoveries 25.8 —

Payments for fixed asset disposition ( 2.9 ) ( 5.2 )

1 unchanged sentence

Cash flows from financing activities:

Net proceeds from commercial paper notes 249.7 —

Proceeds from stock issued pursuant to stock-based compensation plans 5.7 5.5

3 unchanged sentences

Effect of exchange rate changes on cash, cash equivalents and restricted cash ( 0.5 ) 0.9

Net increase (decrease) in cash, cash equivalents and restricted cash ( 65.5 ) 230.7

Net decrease in cash, cash equivalents and restricted cash ( 112.8 ) ( 128.5 )

Cash, cash equivalents and restricted cash at beginning of period 757.2 711.3

19 unchanged sentences

Securities and Exchange Commission (“SEC”) on March 20, 2024.

The results of operations for the 13 weeks ended May 4, 2024 are not necessarily indicative of the results to be expected for the entire fiscal year ending February 1, 2025.

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 4, 2024 and April 29, 2023 and the results of our operations and cash flows for the periods presented.

The results of operations for the 13 and 26 weeks ended August 3, 2024 are not necessarily indicative of the results to be expected for the entire fiscal year ending February 1, 2025.

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 August 3, 2024 and July 29, 2023 and the results of our operations and cash flows for the periods presented.

The February 3, 2024 balance sheet information was derived from the audited consolidated financial statements as of that date.

21 unchanged sentences

Based on the significant damage sustained by the facility, the inventory contained in the facility and the facility itself are not salvageable.

We incurred losses totaling $ 117.0 million as of May 4, 2024, consisting of $ 70.0 million related to damaged inventory and $ 47.0 million related to property and equipment.

Our distribution center insurance policies include significant property and inventory coverage and we believe the aforementioned, incurred losses will be fully offset by insurance recoveries.

As the insurance receivables recorded fully offset the losses incurred, there was no net impact to the accompanying unaudited Condensed Consolidated Income Statements for the 13 weeks ended May 4, 2024.

We incurred losses totaling $ 117.0 million in the first quarter of fiscal 2024, consisting of $ 70.0 million related to damaged inventory and $ 47.0 million related to property and equipment.

These losses were fully offset by insurance receivables.

As of August 3, 2024, we have received insurance proceeds totaling $ 70.8 million, including $ 45.0 million related to damaged inventory and $ 25.8 million related to damaged property and equipment.

We expect that the remaining inventory losses and property and equipment losses will be fully offset by insurance recoveries under our distribution center insurance policies.

Expected insurance recoveries for business interruption and redevelopment costs greater than the losses recognized cannot be estimated at this time.

20 unchanged sentences

Active Matters

DC 202-Related Matters

As previously reported by the company on its Current Report on Form 8-K filed February 26, 2024, Family Dollar Stores, LLC (“Family Dollar”), a wholly-owned subsidiary of the company, entered into a Plea Agreement (the “Plea Agreement”) resolving the U.S.

Department of Justice (“DOJ”) investigation regarding rodent infestation at Family Dollar’s West Memphis, Arkansas distribution center (“DC 202”) and the related distribution of adulterated product.

Subject to the terms and conditions of the Plea Agreement, Family Dollar pled guilty to a one count misdemeanor violation of the Food, Drug and Cosmetics Act for causing FDA-regulated products to become adulterated while such articles were held in DC 202.

Under the Plea Agreement, Family Dollar agreed to pay $ 200,000 in fines and a forfeiture money judgment in the amount of $ 41,475,000 , which relates to the value of the adulterated FDA-regulated products that were held in DC 202.

The Plea Agreement was approved by the United States District Court for the Eastern District of Arkansas at a hearing on February 26, 2024.

No criminal charges were brought against Dollar Tree in connection with this matter.

As part of the Plea Agreement, Dollar Tree and Family Dollar agreed to certain terms relating to its compliance program including submitting certain reports to the DOJ for a three-year term.

The company previously reported a preliminary settlement of a multi-district litigation proceeding in federal court in Tennessee covering 14 putative class actions filed against us primarily related to issues associated with DC 202 described above.

The claims made settlement, which received preliminary approval from the court in October 2023, provided that one class member per household may receive a $ 25 Family Dollar gift certificate.

The period for filing a claim, opting out of the settlement or filing an objection to the settlement ended on January 9, 2024, and on April 5, 2024, the court granted final approval on the settlement.

A lawsuit brought by the Attorney General for the State of Arkansas related to the sale of products from DC 202 remains pending, and the court is expected to hold a hearing on our motion to dismiss the State's claims on July 2, 2024.

As previously disclosed, we recorded charges of $ 56.7 million in fiscal 2023 with respect to DC 202-related matters which included the final resolution of the DOJ investigation and the now-approved settlement of the 14 putative consumer class actions.

At the present time, we are unable to estimate the amount of additional incremental loss, if any, which may result when the State of Arkansas complaint is finally resolved, but we do not believe it will have a material adverse effect on our business, financial condition, or liquidity.

Talc Product Matters

10 unchanged sentences

The dismissal has been appealed to the Second Circuit by plaintiffs.

Resolved Matters

DC 202-Related Matters

As previously reported by the company on its Current Report on Form 8-K filed February 26, 2024, its Annual Report on Form 10-K filed March 20, 2024 and its Quarterly Report on Form 10-Q filed June 5, 2024, Family Dollar Stores, LLC (“Family Dollar”), a wholly-owned subsidiary of the company, has resolved a number of related matters connected to a past rodent infestation at Family Dollar’s West Memphis, Arkansas distribution center (“DC 202”) and recorded charges of $ 56.7 million in fiscal 2023 with respect to such matters.

We do not believe any remaining matters associated with DC 202 will have a material adverse effect on our business, financial condition, or liquidity.

Note 4 - Short-Term Borrowings and Long-Term Debt

As of August 3, 2024, $ 250.0 million principal amount of notes were outstanding under our commercial paper program, with a weighted-average interest rate of 5.5 %.

There were no short-term borrowings outstanding at February 3, 2024 or July 29, 2023.

Note 5 - 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 material impairment charges during the 13 weeks ended May 4, 2024 or April 29, 2023.

We did not record any material impairment charges during the 13 or 26 weeks ended August 3, 2024 or July 29, 2023.

Fair Value of Financial Instruments

1 unchanged sentence

The carrying values of our Revolving Credit Facility and borrowings under our commercial paper program approximate their fair values.

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

May 4, 2024 February 3, 2024 April 29, 2023

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

August 3, 2024 February 3, 2024 July 29, 2023

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

3 unchanged sentences

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

13 Weeks Ended

(in millions, except per share data) May 4, 2024 April 29, 2023

13 Weeks Ended 26 Weeks Ended

(in millions, except per share data) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Basic net income per share:

7 unchanged sentences

applying the treasury stock method)

0.2 0.4 0.3 0.5

Weighted average number of shares and dilutive potential

1 unchanged sentence

Diluted net income per share $ 0.62 $ 0.91 $ 2.00 $ 2.26

Share-based awards of 3.1 million shares and 2.9 million shares were excluded from the calculation of diluted net income per share for the 13 weeks ended May 4, 2024 and April 29, 2023, respectively, because their inclusion would be anti-dilutive.

Share-based awards of 3.4 million shares and 3.1 million shares were excluded from the calculation of diluted net income per share for the 13 and 26 weeks ended August 3, 2024, respectively, because their inclusion would be anti-dilutive.

Share-based awards of 2.4 million shares and 3.0 million shares were excluded from the calculation of diluted net income per share for the 13 and 26 weeks ended July 29, 2023, respectively, because their inclusion would be anti-dilutive.

Note 7 - Shareholders’ Equity

We repurchased 2,537,302 and 1,025,000 shares of common stock on the open market at a cost of $ 312.8 million and $ 152.1 million, including applicable excise tax, during the 13 weeks ended May 4, 2024 and April 29, 2023, respectively.

Of the shares repurchased during the 13 weeks ended May 4, 2024 and April 29, 2023, $ 37.8 million and $ 7.7 million, respectively, settled subsequent to May 4, 2024 and April 29, 2023, respectively, and these amounts were accrued in the accompanying unaudited Condensed Consolidated Balance Sheets.

At May 4, 2024, we had $ 1.04 billion remaining under our existing $ 2.5 billion Board repurchase authorization.

We repurchased 746,535 and 3,283,837 shares of common stock on the open market at a cost of $ 90.8 million and $ 403.6 million, including applicable excise tax, during the 13 and 26 weeks ended August 3, 2024, respectively.

We repurchased 703,713 and 1,728,713 shares of common stock on the open market at a cost of $ 99.9 million and $ 252.0 million, including applicable excise tax, during the 13 and 26 weeks ended July 29, 2023, respectively.

At August 3, 2024, we had $ 952.4 million remaining under our existing $ 2.5 billion Board repurchase authorization.

Note 8 - Segments and Disaggregated Revenue

3 unchanged sentences

We define our segments as those operations whose results our CODM regularly reviews to analyze performance and allocate resources.

The Dollar Tree segment is the leading operator of discount variety stores offering merchandise predominantly at the opening price point of $ 1.25 , with additional offerings at $ 3 , $ 4 and $ 5 price points.

The Dollar Tree segment is the leading operator of discount variety stores offering merchandise predominantly at the opening price point of $ 1.25 , with additional offerings at higher price points.

The Dollar Tree segment includes our operations under the “Dollar Tree” and “Dollar Tree Canada” brands, 15 distribution centers in the United States and two distribution centers in Canada.

1 unchanged sentence

The Family Dollar segment consists of our operations under the “Family Dollar” brand and ten distribution centers.

The Family Dollar segment operating income includes advertising revenue, which is a component of “Other revenue” in the accompanying unaudited Condensed Consolidated Income Statements.

We measure the results of our segments using, among other measures, each segment’s net sales, gross profit and operating income.

The Family Dollar segment operating income (loss) includes advertising revenue, which is a component of “Other revenue” in the accompanying unaudited Condensed Consolidated Income Statements.

On June 5, 2024, we announced that we had initiated a formal review of strategic alternatives for the Family Dollar business segment, which could include among others, a potential sale, spin-off or other disposition of the business.

There is not a set deadline or definitive timetable for the completion of the strategic alternatives review process, and there can be no assurance that this process will result in any transaction or particular outcome.

We measure the results of our segments using, among other measures, each segment’s net sales, gross profit and operating income (loss).

The CODM reviews these metrics for each of our reporting segments.

We may revise the measurement of each segment’s operating income, as determined by the information regularly reviewed by the CODM.

We may revise the measurement of each segment’s operating income (loss), as determined by the information regularly reviewed by the CODM.

If the measurement of a segment changes, prior period amounts and balances are reclassified to be comparable to the current period’s presentation.

1 unchanged sentence

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

(in millions) May 4, 2024 April 29, 2023

13 Weeks Ended 26 Weeks Ended

(in millions) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Condensed Consolidated Income Statement Data (Unaudited):

14 unchanged sentences

Consolidated operating income

203.1 287.8 623.7 707.5

Interest expense, net 28.9 24.2 53.3 50.1

Other expense, net 0.1 0.1

Other (income) expense, net

— ( 0.1 ) 0.1 —

Income before income taxes $ 174.2 $ 263.7 $ 570.3 $ 657.4

(in millions) May 4, 2024 February 3, 2024 April 29, 2023

(in millions) August 3, 2024 February 3, 2024 July 29, 2023

Condensed Consolidated Balance Sheet Data (Unaudited):

12 unchanged sentences

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

13 Weeks Ended

(in millions) May 4, 2024 April 29, 2023

13 Weeks Ended 26 Weeks Ended

(in millions) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Dollar Tree segment net sales by

16 unchanged sentences

As such, the outstanding payment obligations under our supply chain financing program are included within “Accounts payable” in the accompanying unaudited Condensed Consolidated Balance Sheets and within “Cash flows from operating activities” in the accompanying unaudited Condensed Consolidated Statements of Cash Flows.

Our outstanding payment obligations under this program were $ 60.4 million and $ 11.8 million as of May 4, 2024 and February 3, 2024, respectively.

Note 9 - Subsequent Events

Subsequent to the quarter ended May 4, 2024, we announced that we had initiated a formal review of strategic alternatives for the Family Dollar business segment, which could include among others, a potential sale, spin-off or other disposition of the business.

Our outstanding payment obligations under this program were $ 145.2 million and $ 11.8 million as of August 3, 2024 and February 3, 2024, respectively.

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