Dollar Tree 2009 Annual Report Download - page 18

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an฀hour฀was฀effective฀in฀July฀2009.฀As฀a฀result,฀our฀
wages฀have฀increased฀in฀the฀third฀quarter฀of฀2009฀and฀
wages฀will฀continue฀to฀increase฀through฀the฀rst฀half฀
of฀2010;฀however,฀we฀believe฀that฀we฀can฀offset฀the฀
increase in payroll costs through increased productivity
and฀continued฀efciencies฀in฀product฀ow฀to฀our฀stores.
We฀must฀continue฀to฀control฀our฀merchandise฀
costs, inventory levels and our general and administra-
tive฀expenses.฀Increases฀in฀these฀line฀items฀could฀
negatively impact our operating results.
Management’s Discussion And Analysis Of Financial Condition
And Results Of Operations
buyers and improve our merchandise allocation to our
stores.฀We฀believe฀that฀this฀has฀enabled฀us฀to฀better฀
manage฀our฀inventory฀ow฀resulting฀in฀more฀efcient฀
distribution and store operations and increased inven-
tory฀turnover฀for฀each฀of฀the฀last฀ve฀years.฀Inventory฀
turnover฀improved฀by฀approximately฀25฀basis฀points฀in฀
2009฀to฀over฀4฀turns฀for฀the฀year.฀Inventory฀per฀selling฀
square฀foot฀also฀decreased฀5.6%฀at฀January฀30,฀2010฀
compared฀to฀January฀31,฀2009.
฀In฀May฀2007,฀legislation฀was฀enacted฀that฀increased฀
the฀Federal฀Minimum฀Wage.฀The฀last฀increase฀to฀$7.25฀
Results of Operations
The following table expresses items from our consolidated statements of operations, as a percentage of net sales:
Year Ended
January 30,
2010
Year฀Ended
January฀31,
2009฀
Year฀Ended
February฀2,
2008฀
Net sales 100.0% 100.0% 100.0 %
Cost of sales 64.5% 65.7% 65.6%
฀ Gross฀prot฀ 35.5% 34.3% 34.4%
Selling, general and administrative expenses 25.7% 26.4% 26.6%
Operating income 9.8% 7.9 % 7.8 %
Interest฀income 0.0% 0.0% 0.1%
Interest฀expense (0.1%) (0.2%) (0.4%)
฀ Income฀before฀income฀taxes 9.7% 7.7 % 7.5%
Provision for income taxes (3.6%) (2.8%) (2.8%)
Net income 6.1% 4.9% 4.7%
16฀฀฀DOLLAR฀TREE,฀INC.฀•฀2009฀Annual฀Report