Family Dollar Posts Lower Q1 Profit; Cuts FY14 EPS View - Quick Facts

(RTTNews) - Discount retailer Family Dollar Stores, Inc. (FDO) reported a drop in first-quarter net income to $78.03 million, or $0.68 per share, from $80.3 million, or $0.69 per share, a year ago.

However, net sales for the latest quarter reached $2.5 billion, up 3.2%, compared with $2.42 billion in the previous year. Sales were strongest in the Consumables category, which increased 4.7% during the quarter, chiefly driven by strong growth in refrigerated and frozen food, health aids, and tobacco. Comparable-store sales for the comparable 13-week period slid 2.8% as a result of decreased customer transactions and a slight decrease in the average customer transaction value. On average, 27 analysts polled by Thomson Reuters expected earnings per share of $0.69, on $2.51 billion in revenues for the quarter. Analysts' estimates typically exclude one-time items.

Looking ahead to the second quarter of fiscal 2014, the firm expects comparable-store sales to drop in the low-single-digit range and earnings per share to be between $0.85 and $0.95.

For fiscal 2014, earnings per share is now anticipated to lie between $3.25 and $3.55, while a low-to-mid single digit increase is expected in net sales, excluding the impact of the extra week in fiscal 2013. Earlier, the firm expected 52-week earnings per share to be between $3.80 and $4.15. Analysts project earnings per share of $3.98 for the year.

In addition, the company said its President and Chief Operating Officer, Michael Bloom, has left the firm to pursue other interests. Separately, Family Dollar announced the promotion of Jason Reiser as Executive Vice President - Chief Merchandising Officer. He would report to Howard Levine, Chairman and Chief Executive.