Dollar Tree 2009 Annual Report Download - page 4

t฀ the฀ close฀ of฀ 2009,฀ considering฀ every฀ element฀ of฀ our฀ business,฀ ve฀฀฀฀฀฀฀฀฀฀฀฀฀฀
words come readily to mind and fall comfortably upon the page…Wow!
What a great year! It was a year of great accomplishments, in many
ways our best year ever. We continued to prove that our model is relevant in all
economic times—good and bad—by thrilling our customers with unbelievable
values on both what they need and what they want.
Several milestones were met and exceeded.
•฀ Sales surpassed $5 billion dollars – and I am proud to state that we
are the one and only Fortune 500 Company to have achieved this
฀ milestone฀largely฀“a฀dollar฀at฀a฀time.”฀ ฀Today,฀as฀in฀each฀of฀the฀24฀years฀
since our founding in 1986, everything at our Dollar Tree stores is priced
at $1 – or less – every day.
•฀ Our inventory productivity increased to record levels. Our stores have seen the benefit of this with less merchandise
in the backroom and more efficient store operations.
•฀ Our฀ diluted฀ earnings฀per฀ share฀increased฀ 40.7%฀on฀ top฀ of฀ a฀ terric฀year฀ in฀ 2008.฀ Our฀operating฀margin฀ grew฀ by
190 basis points and remains among the highest in value retailing.
•฀ We฀expanded฀selling฀square฀footage฀by฀6.6%฀in฀ 2009,฀opening฀240฀new฀stores฀and฀providing฀new฀jobs฀and฀growth
opportunities for our associates. Stores opened earlier in the year and more productively with new store sales
exceeding plan. Our new store productivity was the highest in years.
Our customer traffic increased throughout the year. New shoppers are finding us every day and I believe we can keep
them coming back by remaining true to our goals, exceeding their expectations with surprising merchandise value and run-
ning stores that “Wow” them with a fun, full and friendly place to shop.
2009 Financial Results
Total฀consolidated฀sales฀in฀2009฀were฀$5.23฀billion,฀an฀increase฀of฀12.6%฀over฀last฀year’s฀sales฀of฀$4.64฀billion.฀Comparable฀
store฀sales฀increased฀7.2%,฀on฀top฀of฀a฀4.1%฀comparable฀store฀sales฀increase฀in฀2008.฀
Our฀diluted฀earnings฀per฀share฀set฀a฀new฀record—$3.56,฀an฀increase฀of฀$1.03฀or฀40.7%฀over฀last฀year’s฀reported฀$2.53,฀
which was itself a record. Operating income grew by $147 million and operating margin increased to 9.8% of sales, com-
pared฀to฀7.9%฀in฀scal฀2008—an฀increase฀of฀190฀bps฀over฀2008.฀Our฀operating฀margin฀remains฀among฀the฀highest฀in฀the฀
value฀retail฀sector.฀฀Net฀income฀rose฀39.7%฀to฀$321฀million.
Everyone at Dollar Tree can take great pride in these results, not only because they are record-setting successes in
themselves, but because they collectively speak to the underlying strength of our model, our infrastructure and our
strategy. We are finding ways to better serve the customer, run better stores, operate more efficiently and successfully
compete in the marketplace.
2009 Accomplishments – Built on a Strong Foundation
Our success has been no accident. It is the result of rigorous execution of a strategy that has been in place and evolving
for more than a decade. We invested with foresight to right-size our stores, develop and implement Retail Technology sys-
tems that are tailored to Dollar Tree’s unique business model and build a solid and scalable Logistics Infrastructure. Our store
expansion has been measured, disciplined and strategic. In addition, we continuously examine and refine our store model
and assortments to maximize our relevance to customers and our financial returns for shareholders. This is being translated
into an increasingly efficient operation and positions the Company for continued growth. The Company has leveraged
depreciation expense and increased its inventory turns for five consecutive years.
We continue to right-size our stores and add new product. We have evolved from small, mall-based locations and now
open฀10,000฀-฀12,000฀sq.฀ft.฀stores฀in฀strip฀centers฀and฀free-standing฀locations.฀We฀believe฀this฀to฀be฀our฀optimum฀size฀
Bob Sasser
President and Chief Executive Officer
A
2฀฀฀DOLLAR฀TREE,฀INC.฀•฀2009฀Annual฀Report