Dollar Tree, Inc. (NASDAQ:DLTR) Q2 2020 Earnings Conference Call - Final Transcript

Aug 27, 2020 • 09:00 am ET


Dollar Tree, Inc. (NASDAQ:DLTR) Q2 2020 Earnings Conference Call - Final Transcript


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Good day, and welcome to the Dollar Tree Incorporated Second Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Randy Guiler, VP Investor Relations. Please go ahead, sir.

Randy Guiler

Thank you, Shelby. Good morning and welcome to our call to discuss Dollar Tree's performance for the Second Fiscal Quarter of 2020. With me on today's call will be our President and CEO, Mike Witynski and our CFO, Kevin Wampler.

Before we begin, I would like to remind everyone that various remarks that we will make about future expectations, plans, and prospects for the Company constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors included in our most recent press release, most recent 8-K, 10-Q, and Annual Report, which are on file with the SEC. We have no obligation to update our forward-looking statements and you should not expect us to do so.

At the end of our prepared remarks, we will open the call to your questions. Please limit your questions to one and one related follow-up question if necessary.

Now, I will turn the call over to Mike Witynski, Dollar Tree's President and Chief Executive Officer.

Michael A. Witynski

Thank you, Randy. Good morning, everyone. I'm very pleased with the Company's second quarter results announced this morning. Our store and distribution center teams have done a remarkable job of serving customers through an incredibly dynamic time in retail.

Their continued efforts to ensure we are providing a clean, safe, shopping experience, along with great value and convenience our stores offer, contributed to our solid operating performance for the quarter. Our team delivered an earnings per share increase of 44.7% compared to prior year's quarter. These results for the Enterprise were comprised of a 7.2% same-store sales increase, a 180 basis points improvement in gross profit margin, and a 130 basis point increase in operating profit margin. Same-store sales increased 11.6% at Family Dollar and 3.1% at Dollar Tree.

It's a new day at Family Dollar. You know in early March, on our Q4 earnings call and following our December leadership realignment, I spoke about the challenge and opportunity to turnaround the discretionary side of the business at Family Dollar. Our focus is on greater values and sharper price points with an enhanced focus on meeting the basic needs of our customers.

It's all about sourcing more of the items customers want to buy. Our team's efforts are paying off as Family Dollar delivered a record 28.9% same-store sales increase in discretionary for the quarter. Our realigned and focused merchandising team is demonstrating how they can be nimble and opportunistic to drive sales, loyalty and repeat visits at Family Dollar. Examples of this included; following on the success we experienced at Dollar Tree, we have now completed the rollout of Hallmark branded greeting