Dollar Tree (DLTR) 4Q15 Results: Slightly Light but Complicated Quarter Due to Family Dollar Acquisition; Back on Track in 2016

Executive Summary

• Dollar Tree reported that 4Q15 revenues were up 116.7%, to $5.4 billion, which was at the midpoint of the guidance range but slightly below the consensus estimate. The figure includes $2.7 billion of revenue from the company’s Family Dollar acquisition. Excluding this figure, revenues increased by 8.5%. Adjusted EPS was $1.01, below the $1.07 consensus estimate.
• Following a tough, 5.6% comp in the year-ago quarter, same-store sales increased by 1.7% on a constant-currency basis in 4Q15 (and by 1.3% when adjusted for fluctuations in the Canadian dollar). Comps were positive for Family Dollar as well.
• For 2016, the company expects revenues of $20.8–$21.1 billion versus consensus of $21.0 billion and EPS of $3.35–$3.65 versus consensus of $3.78.