Dollar Tree 2011 Annual Report Download - page 4

Bob Sasser
President and Chief Executive Officer
To Our
Shareholders
Iam pleased to report that 2011 was another
year of record results for Dollar Tree.
U Net sales were $6.63 billion; an increase of 12.7%
over fiscal 2010.
U Comparable-store sales increased 6.0% on top of a
6.3% comparable-store sales increase last year.
U Earnings in fiscal 2011 increased to a record $4.03
per diluted share compared with $3.10 earnings per
diluted share in 2010. e 2010 result included a
non-recurring, non-cash charge of $26.3 million, or
$0.13 cents per share relating to a change in retail
inventory accounting that was recorded in the first
quarter 2010. Excluding the charge, earnings per
diluted share in 2010 were $3.23, which was itself a
36.3% increase over 2009 reported EPS of $2.37.
U Operating margin was 11.8%, an increase of 70 bps
compared with 2010, excluding the 2010 charge.
Dollar Tree’s operating margin remains among the
highest in the value retail sector.
U In addition, compared with last year excluding the
charge in 2010, operating income increased by
$125.8 million,
U And net income rose 18.0%, to $488.3 million.
In addition, in 2011, Dollar Tree:
U Expanded selling square footage 6.9%, opening 278 new
stores, expanding or relocating 91 stores, providing new
jobs and growth opportunities for our associates;
U Ended the year with 4,351 stores across 48 U.S. states and
five Canadian Provinces;
U Achieved the highest new store productivity since 2001;
U Increased inventory turns for the seventh consecutive year,
to 4.22 turns in 2011 compared with 4.17 turns in 2010;
U Completed the expansion of our Distribution Center in
Savannah, Georgia, on-time and on-budget, and
U Repurchased 8.7 million shares for $645.9 million.
ese results reflect the underlying strength of our model,
our infrastructure, our strategy and most importantly, the ded-
icated efforts of thousands of Dollar Tree associates across the
United States and Canada.
Performance based on a Solid Foundation
e success of Dollar Tree—as it has always been—is
based on our focus on the customer. We aim our efforts at in-
creasing the “Wow” factor, providing high value merchandise,
improving the quality of our shopping environment and pro-
viding the infrastructure that supports the business.
Powerful, Flexible Sourcing Model
Dollar Tree has a powerful, flexible merchandising model
and we use this strategy of ever-changing assortments to our
advantage. Our assortments are planned to offer the greatest
value to the customer for $1 and to do so at a cost that delivers
acceptable merchandise margin.
Reflecting the changing demands of the market, we have
broadened our assortments to include more of the things
people need everyday, in addition to seasonal and discretion-
ary merchandise. ese “basic needs” items are faster-turning,
broaden our appeal to more customers, drive traffic, help in-
crease sales across all categories and provide the opportunity
to increase market share. is strategy has contributed to the
growth of our sales, margins and earnings.
To the customer, this means there is always something new
at Dollar Tree. As customers strive to balance their budgets, they
can find the high value basics they need while enjoying the “rill
of the hunt” on every visit. Seasonal assortments are fresh, col-
orful and fun, providing merchandise energy in the stores. We
have the flexibility to move quickly from item to item within our
stores. is strategic advantage has been validated by results.
History shows that we can remain relevant through inflationary
and deflationary cycles by changing the product or changing the
source while maintaining our focus on achieving margin targets
and providing great value to our customers for their dollar.
Retail Technology
Dollar Tree’s retail technology is tailored to our unique
business model. is technology enables us to make “smarter”
2 Dollar Tree, Inc.