Dollar Tree 2012 Annual Report Download - page 14

Management’s Discussion & Analysis of
Financial Condition and Results of Operations
A WARNING ABOUT FORWARD-LOOKING
STATEMENTS: is document contains “forward-
looking statements” as that term is used in the Private
Securities Litigation Reform Act of 1995. Forward-
looking statements address future events, developments
and results. ey include statements preceded by,
followed by or including words such as “believe,”
“anticipate,” “expect,” “intend,” “plan,” “view,” “target” or
“estimate.” For example, our forward-looking statements
include statements regarding:
•ouranticipatedsales,includingcomparablestorenet
sales, net sales growth and earnings growth;
•costsofpendingandpossiblefuturelegalclaims;
•ourgrowthplans,includingourplanstoadd,expand
or relocate stores, our anticipated square footage
increase, and our ability to renew leases at existing
store locations;
•theaveragesizeofourstorestobeaddedin2013
and beyond;
•theeectofashiftinmerchandisemixtoconsum-
ables and the increase in the number of our stores
withfreezersandcoolersongrossprotmargin
and sales;
•thenetsalespersquarefoot,netsalesandoperating
income of our stores and store-level cash payback
metrics;
•thepotentialeectofthecurrenteconomicdown-
turn, inflation and other economic changes on our
costsandprotability,includingthepotentialeect
of future changes in minimum wage rates, shipping
rates, domestic and import freight costs, fuel costs
andwageandbenetcosts;
•ourgrossprotmargin,earnings,inventorylevels
and ability to leverage selling, general and adminis-
trativeandotherxedcosts;
•ourseasonalsalespatternsincludingthoserelating
to the length of the holiday selling seasons and the
eectofanearlierEasterin2013;
•thecapabilitiesofourinventorysupplychain
technology and other systems;
•thereliabilityof,andcostassociatedwith,our
sources of supply, particularly imported goods such
as those sourced from China;
•thecapacity,performanceandcostofourdistribu-
tion centers;
•ourcashneeds,includingourabilitytofundour
future capital expenditures and working capital
requirements;
•ourexpectationsregardingcompetitionandgrowth
in our retail sector; and
•management’sestimatesassociatedwithourcritical
accounting policies, including inventory valuation,
accrued expenses and income taxes.
For a discussion of the risks, uncertainties and
assumptionsthatcouldaectourfutureevents,
developments or results, you should carefully review
the risk factors described in Item 1A “Risk Factors” and
“Business”sectionsinourAnnualReportonForm10-K
ledonMarch15,2013.Alsoseeour“Management’s
Discussion and Analysis of Financial Condition and
Results of Operations”.
•Ourprotabilityisvulnerabletocostincreases.
•Adownturnineconomicconditionscouldimpact
our sales.
•Litigationmayadverselyaectourbusiness,nancial
condition and results of operations.
•Changesinfederal,stateorlocallaw,orourfailureto
comply with such laws, could increase our expenses
and expose us to legal risks.
•Ourgrowthisdependentonourabilitytoincrease
sales in existing stores and to expand our square
footageprotably.
•Risksassociatedwithourdomesticandforeign
suppliers from whom our products are sourced could
aectournancialperformance.
•Wecouldencounterdisruptionsinourdistribu-
tion network or additional costs in distributing
merchandise.
•Ourprotabilityisaectedbythemixofproducts
we sell.
•Pressurefromcompetitorsmayreduceoursalesand
prots.
•Asignicantdisruptioninorsecuritybreachinour
computersystemscouldadverselyaectouropera-
tions or our ability to secure customer, employee and
company data.
•Ourbusinesscouldbeadverselyaectedifwefail
toattractandretainqualiedassociatesandkey
personnel.
•CertainprovisionsinourArticlesofIncorporation
and Bylaws could delay or discourage a takeover
attemptthatmaybeinashareholder’sbestinterest.
12 Dollar Tree, Inc.