Dollar Tree’s Family Dollar Dilemma: Sale, Spinoff, or Strategic Escape?

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Dollar Tree Considers Sale or Spin-off of Struggling Family Dollar Chain

Dollar Tree store exterior
Discount retailer Dollar Tree is exploring options for its Family Dollar stores.

Strategic Review Underway

Discount giant Dollar Tree is evaluating its options for the Family Dollar chain it acquired almost a decade ago. The company indicated it might sell or spin off the business as part of a strategic review.

Dollar Tree has faced challenges integrating Family Dollar into its operations. Recently, the company announced plans to close nearly 1,000 stores, primarily Family Dollar locations.

The move follows a comprehensive review launched last year, leading to the planned closure of 970 underperforming Family Dollar stores.

Dollar Tree has not set a timeframe for completing the strategic review.

Reopening of 99 Cents Only Stores

Amidst the Family Dollar deliberations, Dollar Tree announced it will reopen close to 200 shuttered 99 Cents Only stores from California to Texas as Dollar Tree locations.

The transfer of rights and assets was approved by a bankruptcy court in Delaware.

Financial Results

In its latest financial results, Dollar Tree reported an adjusted profit of .43 per share on revenue of .63 billion for the first quarter. The performance aligned with analysts’ expectations.

For the second quarter, Dollar Tree forecasts earnings between and .10 per share and revenue ranging from .3 billion to .6 billion. Analysts predict earnings of .19 per share on revenue of .59 billion.

For the full year, Dollar Tree expects earnings to fall between .50 and per share, with revenue ranging from billion to billion. Wall Street estimates earnings of .89 per share on revenue of .36 billion.

Dollar Tree operates over 16,300 stores across 48 US states and five Canadian provinces under its Dollar Tree, Family Dollar, and Dollar Tree Canada brands.

Shares of Dollar Tree Inc. declined about 2% before market open.