Q2 financial results that outperformed Wall Street expectations for Burlington Coat Factory and Dollar Tree showcase the health of off-price retail, even as sectors such as department stores continue to struggle.
Total Q2 sales for Burlington increased 8.6% over the same period last year, reaching $1.3 billion. The growth was driven by an increase of $70 million from new and non-comparable stores, along with a 3.5% increase in comp store sales. Net income climbed 130% over the prior year to $47 million, or $0.66 per diluted share vs. $0.28 last year.
“We are extremely pleased to report strong second quarter results,” said Tom Kingsbury, Burlington CEO in a statement. “Our inventories are fresh, we are well positioned for Back to School, and we have significant open-to-buy entering the third quarter as opportunities remain plentiful.”
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Dollar Tree, which acquired its former rival Family Dollar in 2015, saw consolidated net sales increase 5.7% to $5.28 billion in Q2, helped by same-store sales growth of 2.4%. The Dollar Tree banner’s same-store sales growth outpaced Family Dollar’s, 3.9% to 1.0%.
Net income rose to $233.8 million for Q2, a 37% increase over the same period last year. Diluted earnings per share rose 36.1% to $0.98, up from $0.72 in Q2 of 2016.
“Both Dollar Tree and Family Dollar produced positive same-store sales, our enterprise operating margin improved 80 basis points and earnings per share exceeded the high end of our guidance range,” said CEO Bob Sasser in a statement. “Consumers continue to view Dollar Tree and Family Dollar as stores that provide great value and convenience.”
