Dollar Tree 2006 Annual Report Download - page 6

4DOLLAR TREE STORES, INC. • 2006 ANNUAL REPORT
DEAL$
Last March, we acquired the Deal$ chain. Our intention is not to convert these stores to Dollar Trees but
to use them as a platform to develop an additional format. Within six months we integrated the Deal$
stores into our back office processes and systems and in the fall, we lifted the restriction of the $1 price
point and introduced a new store look and a high value, compelling general merchandise assortment.
Our customers have responded favorably and we are encouraged by the results in terms of average
ticket, store productivity and margin. This year we will begin to expand this concept with plans to open
25 new Deal$ stores. These new Deal$ stores will provide an additional opportunity to develop the
sales potential and operating metrics of the new model.
CORPORATE GOVERNANCE
Dollar Tree is committed to responsible corporate governance. To strengthen that commitment, we
continue to review best practices and respond with changes accordingly. We recently adopted a
majority vote governance policy with respect to the election of directors who run unopposed, created
an independent committee with responsibility for Corporate Governance, and established the
position of Lead Independent Director on our Board. Most importantly we remain focused on
our core values. We are very proud of our record and our history of honesty, integrity and
transparency. We are uncompromising in these values and they will always be reflected in
our strength of financial controls, our open and straight forward relationships with our
customers, our suppliers, our associates and our shareholders.
We are committed to increasing total shareholder returns. As chronicled in this
annual report, our stock has performed well over the past year, achieving an increase
in share price of nearly 27%. In doing so, we outperformed the major indices with a
larger increase than the S & P 500, the Dow Jones Industrial Average and the NASDAQ
Composite. In addition to solid growth in revenue and earnings, in 2006 we returned
over $248 million dollars to our shareholders in the form of share repurchase. We
believe this to be a good use of cash and we will continue to examine strategies to build
total shareholder returns.
THE FUTURE
As we enter our third decade, we can look back with pride at our accomplishments and look forward
to even more exciting opportunities. We have grown from six stores in 1986 to more than 3,200 today,
and we are positioned to expand to 5,000 – 7,000 stores over the long term. All of the tools are in place
to achieve these goals while continuing to achieve sector leading profitability. At Dollar Tree, we have a
concept that customers love, a rock-solid foundation on which to build, one that is proven and scalable,
a solid, cash rich balance sheet and an experienced and focused management team. We believe the
best is still to come!
Bob Sasser
President and Chief Executive Officer