MATTHEWS, N.C. — Family Dollar Stores here said comparable-store sales for the fiscal first quarter rose 6.9% — its best first-quarter comps in more than 12 years — but investors shunned the stock after the company disappointed with its earnings and outlook.
The discounter attributed the jump in comp sales to increased customer traffic, as measured by the number of register transactions, although average transaction value for the quarter was close to flat. Sales were strongest in the consumables category, the company added, driven primarily by double-digit increases in candy and food.
"Clearly, our investments to improve the shopping experience in our stores are positioning us well to serve a growing number of customers," said Howard R. Levine, chairman and chief executive officer.
Comps for December rose approximately 4%, he added, with strong performance in the toy and consumables areas.
Net income for the quarter rose 9.9% to $74.3 million, while sales were up 9.5% to $2 billion. The earnings missed analysts’ consensus estimates slightly. The company also reduced the top end of its earnings guidance for the year.
