Dollar Tree 1Q profit falls on costs, inclement weather

Dollar Tree reported a drop in first-quarter profit as it faced higher freight costs and inclement weather weighed down sales.

The discount retailer also reported weak sales in existing stores and trimmed its full-year guidance. Shares fell 8 percent before the opening bell.

Profit declined 19.9 percent to $160.5 million, or 67 cents per share. Earnings, adjusted for debt-refinancing costs, were $1.19 per share, falling short of industry analysts by 4 cents, according to a survey by Zacks Investment Research.

Revenue rose 5 percent to $5.55 billion in the period, which also did not meet Street forecasts. Eight analysts surveyed by Zacks expected $5.57 billion.

Same-store sales — or sales in stores open at least a year, a key retailer metric — rose 1.4 percent. Analysts were looking for a 2.6 percent boost.

For the current quarter ending in August, Dollar Tree said it expects earnings per share of $1.07 to $1.16, with revenue in the range of $5.47 billion to $5.57 billion. Analysts surveyed by Zacks had expected revenue of $5.57 billion.

The Chesapeake, Virginia-based retailer now expects full-year earnings to be $4.80 to $5.10 per share, with revenue ranging from $22.73 billion to $23.05 billion. Previously it forecast earnings per share in a range of $5.25 to $5.60, with revenue of $22.7 billion to $23.12 billion. That compares with the average analyst estimate for full-year profit of $5.64 per share and revenue of $23 billion, based on a FactSet survey.

Dollar Tree Inc. shares have dropped 10 percent since the beginning of the year, while the Standard & Poor’s 500 index has climbed nearly 2 percent. The stock has risen 23 percent in the last 12 months.

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Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on DLTR at https://www.zacks.com/ap/DLTR