Virginia
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26-2018846
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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500 Volvo Parkway, Chesapeake, Virginia
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23320
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(Address of principal executive offices)
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(Zip Code)
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $.01 per share
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NASDAQ
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Yes [X]
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No [ ]
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Yes [ ]
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No [X]
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Yes [X]
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No [ ]
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Yes [X]
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No [ ]
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Large accelerated filer [X]
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Accelerated filer [ ]
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Non-accelerated filer [ ] (Do not check if a smaller reporting company)
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Smaller reporting company [ ]
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Emerging growth company [ ]
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Yes [ ]
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No [X]
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Page
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PART I
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Item 1.
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Business
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Item 1A.
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Risk Factors
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Item 1B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures
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PART II
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Item 5.
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Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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Item 6.
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Selected Financial Data
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Item 7.
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Management's Discussion and Analysis of Financial Condition and Results of Operations
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Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk
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Item 8.
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Financial Statements and Supplementary Data
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Item 9.
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Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
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Item 9A.
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Controls and Procedures
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Item 9B.
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Other Information
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PART III
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Item 10.
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Directors, Executive Officers and Corporate Governance
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Item 11.
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Executive Compensation
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Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence
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Item 14.
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Principal Accounting Fees and Services
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PART IV
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Item 15.
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Exhibits, Financial Statement Schedules
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Item 16.
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Form 10-K Summary
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Signatures
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•
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the benefits, results and effects of the Family Dollar acquisition and integration and the combined Company’s plans, objectives, expectations (financial or otherwise), including synergies, the cost to achieve synergies and the effect on earnings per share;
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•
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the ability to retain key personnel at Family Dollar and Dollar Tree;
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•
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our anticipated sales, including comparable store net sales, net sales growth and earnings growth;
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•
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the potential effect of future law changes, including taxes and tariffs, the Fair Labor Standards Act as it relates to the qualification of our managers for exempt status, minimum wage and health care law;
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•
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the outcome and costs of pending or potential litigation or governmental investigations;
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•
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our growth plans, including our plans to add, rebanner, expand or relocate stores, our anticipated square footage increase, and our ability to renew leases at existing store locations;
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•
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the average size of our stores to be added in 2018 and beyond;
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•
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the effect on our merchandise mix of consumables and the increase in the number of our stores with freezers and coolers on Dollar Tree's gross profit margin and sales;
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•
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the effect of the Family Dollar renovation initiative and other initiatives on Family Dollar's sales;
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•
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the net sales per square foot, net sales and operating income of our stores;
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•
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the potential effect of inflation or deflation and other general business or economic conditions on our costs and profitability, including the potential effect of future changes in prevailing wage rates and overtime regulations and our plans to address these changes, shipping rates, domestic and import freight costs, fuel costs and wage and benefit costs, consumer spending levels, population, employment and job growth and/or losses in our markets;
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•
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our gross profit margin, earnings, inventory levels and ability to leverage selling, general and administrative and other fixed costs;
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•
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the effect of recent changes in tax laws;
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•
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our seasonal sales patterns including those relating to the length of the holiday selling seasons;
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•
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the capabilities of our inventory supply chain technology and other systems;
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•
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the reliability of, and cost associated with, our sources of supply, particularly imported goods such as those sourced from China;
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•
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the capacity, performance and cost of our distribution centers;
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•
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our cash needs, including our ability to fund our future capital expenditures and working capital requirements and our ability to service our debt obligations;
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•
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our expectations regarding competition and growth in our retail sector; and
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•
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management's estimates associated with our critical accounting policies, including inventory valuation, accrued expenses, valuations for impairment analyses and income taxes.
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•
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variety merchandise, which includes toys, durable housewares, gifts, stationery, party goods, greeting cards, softlines, and other items; and
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February 3,
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January 28,
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||
Merchandise Type
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2018
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2017
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||
Consumable
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49.0
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%
|
|
48.9
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%
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Variety
|
|
46.3
|
%
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46.5
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%
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Seasonal
|
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4.7
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%
|
|
4.6
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%
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|
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February 3,
|
|
January 28,
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||
Merchandise Type
|
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2018
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2017
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||
Consumable
|
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75.3
|
%
|
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74.6
|
%
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Home products
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8.4
|
%
|
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8.7
|
%
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Apparel and accessories
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6.6
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%
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7.0
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%
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Seasonal and electronics
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9.7
|
%
|
|
9.7
|
%
|
•
|
growing both the Dollar Tree and Family Dollar banners;
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•
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maintaining customer relevance by ensuring that we reinvent ourselves constantly through new merchandise categories;
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•
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leveraging the complementary merchandise expertise of each banner including Dollar Tree's sourcing and product development expertise and Family Dollar's consumer package goods and national brands sourcing expertise; and
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•
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Savings from sourcing and procurement of merchandise and non-merchandise goods and services driven by leveraging the combined volume of the Dollar Tree and Family Dollar banners, among other things;
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•
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Rebannering to optimize store formats;
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•
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A reduction in overhead and corporate selling, general and administrative expenses by eliminating redundant positions and optimizing processes; and
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•
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Savings resulting from the optimization of distribution and logistics networks.
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•
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Shipping costs.
We could experience increases in shipping rates imposed by the trans-Pacific ocean carriers. Changes in import duties, import quotas and other trade sanctions could increase our costs.
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United States
|
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Dollar Tree
|
|
Family Dollar
|
|
Total
|
|||
Alabama
|
|
130
|
|
|
167
|
|
|
297
|
|
Arizona
|
|
124
|
|
|
164
|
|
|
288
|
|
Arkansas
|
|
76
|
|
|
115
|
|
|
191
|
|
California
|
|
574
|
|
|
131
|
|
|
705
|
|
Colorado
|
|
94
|
|
|
128
|
|
|
222
|
|
Connecticut
|
|
62
|
|
|
55
|
|
|
117
|
|
Delaware
|
|
31
|
|
|
29
|
|
|
60
|
|
District of Columbia
|
|
3
|
|
|
3
|
|
|
6
|
|
Florida
|
|
486
|
|
|
601
|
|
|
1,087
|
|
Georgia
|
|
243
|
|
|
397
|
|
|
640
|
|
Idaho
|
|
36
|
|
|
47
|
|
|
83
|
|
Illinois
|
|
254
|
|
|
224
|
|
|
478
|
|
Indiana
|
|
137
|
|
|
211
|
|
|
348
|
|
Iowa
|
|
54
|
|
|
31
|
|
|
85
|
|
Kansas
|
|
54
|
|
|
47
|
|
|
101
|
|
Kentucky
|
|
103
|
|
|
217
|
|
|
320
|
|
Louisiana
|
|
111
|
|
|
324
|
|
|
435
|
|
Maine
|
|
38
|
|
|
61
|
|
|
99
|
|
Maryland
|
|
117
|
|
|
98
|
|
|
215
|
|
Massachusetts
|
|
121
|
|
|
96
|
|
|
217
|
|
Michigan
|
|
235
|
|
|
388
|
|
|
623
|
|
Minnesota
|
|
116
|
|
|
71
|
|
|
187
|
|
Mississippi
|
|
75
|
|
|
161
|
|
|
236
|
|
Missouri
|
|
143
|
|
|
116
|
|
|
259
|
|
Montana
|
|
14
|
|
|
14
|
|
|
28
|
|
Nebraska
|
|
26
|
|
|
37
|
|
|
63
|
|
Nevada
|
|
53
|
|
|
53
|
|
|
106
|
|
New Hampshire
|
|
36
|
|
|
31
|
|
|
67
|
|
New Jersey
|
|
159
|
|
|
106
|
|
|
265
|
|
New Mexico
|
|
48
|
|
|
132
|
|
|
180
|
|
New York
|
|
315
|
|
|
315
|
|
|
630
|
|
North Carolina
|
|
251
|
|
|
454
|
|
|
705
|
|
North Dakota
|
|
11
|
|
|
23
|
|
|
34
|
|
Ohio
|
|
261
|
|
|
476
|
|
|
737
|
|
Oklahoma
|
|
77
|
|
|
138
|
|
|
215
|
|
Oregon
|
|
92
|
|
|
—
|
|
|
92
|
|
Pennsylvania
|
|
297
|
|
|
316
|
|
|
613
|
|
Rhode Island
|
|
30
|
|
|
28
|
|
|
58
|
|
South Carolina
|
|
116
|
|
|
241
|
|
|
357
|
|
South Dakota
|
|
11
|
|
|
30
|
|
|
41
|
|
Tennessee
|
|
172
|
|
|
228
|
|
|
400
|
|
Texas
|
|
489
|
|
|
1,062
|
|
|
1,551
|
|
Utah
|
|
61
|
|
|
59
|
|
|
120
|
|
Vermont
|
|
11
|
|
|
14
|
|
|
25
|
|
Virginia
|
|
179
|
|
|
244
|
|
|
423
|
|
Washington
|
|
122
|
|
|
—
|
|
|
122
|
|
West Virginia
|
|
46
|
|
|
126
|
|
|
172
|
|
Wisconsin
|
|
118
|
|
|
145
|
|
|
263
|
|
Wyoming
|
|
13
|
|
|
31
|
|
|
44
|
|
Total
|
|
6,425
|
|
|
8,185
|
|
|
14,610
|
|
Canada
|
|
Dollar Tree
|
|
Alberta
|
|
38
|
|
British Columbia
|
|
51
|
|
Manitoba
|
|
12
|
|
Ontario
|
|
109
|
|
Saskatchewan
|
|
15
|
|
Total
|
|
225
|
|
Location
|
|
Size in
Square Feet
|
|
Dollar Tree:
|
|
|
|
Chesapeake, Virginia
|
|
400,000
|
|
Olive Branch, Mississippi
|
|
425,000
|
|
Joliet, Illinois
|
|
1,470,000
|
|
Stockton, California
|
|
854,000
|
|
Savannah, Georgia
|
|
1,014,000
|
|
Briar Creek, Pennsylvania
|
|
1,003,000
|
|
Marietta, Oklahoma
|
|
1,004,000
|
|
San Bernardino, California
|
|
802,000
|
|
Ridgefield, Washington
|
|
665,000
|
|
Windsor, Connecticut
|
|
1,001,000
|
|
Cherokee County, South Carolina
|
|
1,512,000
|
|
Family Dollar:
|
|
|
|
Matthews, North Carolina
|
|
930,000
|
|
West Memphis, Arkansas
|
|
850,000
|
|
Front Royal, Virginia
|
|
907,000
|
|
Duncan, Oklahoma
|
|
907,000
|
|
Morehead, Kentucky
|
|
907,000
|
|
Maquoketa, Iowa
|
|
907,000
|
|
Odessa, Texas
|
|
907,000
|
|
Marianna, Florida
|
|
907,000
|
|
Rome, New York
|
|
907,000
|
|
Ashley, Indiana
|
|
814,000
|
|
St. George, Utah
|
|
814,000
|
|
•
|
employment-related matters;
|
•
|
infringement of intellectual property rights;
|
•
|
personal injury/wrongful death claims;
|
•
|
product safety matters, which may include product recalls in cooperation with the Consumer Products Safety Commission or other jurisdictions;
|
•
|
real estate matters related to store leases; and
|
•
|
environmental and safety issues.
|
|
|
High
|
|
Low
|
||||
Fiscal year ended January 28, 2017:
|
|
|
|
|
||||
First Quarter
|
|
$
|
83.72
|
|
|
$
|
72.52
|
|
Second Quarter
|
|
97.45
|
|
|
73.02
|
|
||
Third Quarter
|
|
99.93
|
|
|
74.36
|
|
||
Fourth Quarter
|
|
91.41
|
|
|
72.55
|
|
||
Fiscal year ended February 3, 2018:
|
|
|
|
|
|
|
||
First Quarter
|
|
$
|
83.21
|
|
|
$
|
72.89
|
|
Second Quarter
|
|
83.48
|
|
|
65.63
|
|
||
Third Quarter
|
|
93.68
|
|
|
71.19
|
|
||
Fourth Quarter
|
|
116.65
|
|
|
90.30
|
|
|
Year Ended
|
||||||||||||||||||
|
February 3,
2018 |
|
January 28,
2017 |
|
January 30,
2016 |
|
January 31,
2015 |
|
February 1,
2014 |
||||||||||
Income Statement Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
22,245.5
|
|
|
$
|
20,719.2
|
|
|
$
|
15,498.4
|
|
|
$
|
8,602.2
|
|
|
$
|
7,840.3
|
|
Gross profit
|
7,021.9
|
|
|
6,394.7
|
|
|
4,656.7
|
|
|
3,034.0
|
|
|
2,789.8
|
|
|||||
Selling, general and administrative expenses
|
5,022.8
|
|
|
4,689.9
|
|
|
3,607.0
|
|
|
1,993.8
|
|
|
1,819.5
|
|
|||||
Operating income
|
1,999.1
|
|
|
1,704.8
|
|
|
1,049.7
|
|
|
1,040.2
|
|
|
970.3
|
|
|||||
Net income
|
1,714.3
|
|
|
896.2
|
|
|
282.4
|
|
|
599.2
|
|
|
596.7
|
|
|||||
Margin Data (as a percentage of net sales):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross profit
|
31.6
|
%
|
|
30.8
|
%
|
|
30.1
|
%
|
|
35.3
|
%
|
|
35.6
|
%
|
|||||
Selling, general and administrative expenses
|
22.6
|
%
|
|
22.6
|
%
|
|
23.3
|
%
|
|
23.2
|
%
|
|
23.2
|
%
|
|||||
Operating income
|
9.0
|
%
|
|
8.2
|
%
|
|
6.8
|
%
|
|
12.1
|
%
|
|
12.4
|
%
|
|||||
Net income
|
7.7
|
%
|
|
4.3
|
%
|
|
1.8
|
%
|
|
7.0
|
%
|
|
7.6
|
%
|
|||||
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Diluted net income per share
|
$
|
7.21
|
|
|
$
|
3.78
|
|
|
$
|
1.26
|
|
|
$
|
2.90
|
|
|
$
|
2.72
|
|
Diluted net income per share increase (decrease)
|
90.7
|
%
|
|
200.0
|
%
|
|
(56.6
|
)%
|
|
6.6
|
%
|
|
1.5
|
%
|
|
As of
|
||||||||||||||||||
|
February 3,
2018 |
|
January 28,
2017 |
|
January 30,
2016 |
|
January 31,
2015 |
|
February 1,
2014 |
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents and short-term investments
|
$
|
1,097.8
|
|
|
$
|
870.4
|
|
|
$
|
740.1
|
|
|
$
|
864.1
|
|
|
$
|
267.7
|
|
Working capital
|
1,717.2
|
|
|
1,832.1
|
|
|
1,840.5
|
|
|
1,133.0
|
|
|
692.2
|
|
|||||
Total assets
|
16,332.8
|
|
|
15,701.6
|
|
|
15,901.2
|
|
|
3,492.7
|
|
|
2,767.7
|
|
|||||
Total debt, including capital lease obligations
|
5,732.7
|
|
|
6,391.8
|
|
|
7,465.5
|
|
|
757.0
|
|
|
769.8
|
|
|||||
Shareholders' equity
|
7,182.3
|
|
|
5,389.5
|
|
|
4,406.9
|
|
|
1,785.0
|
|
|
1,170.7
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year Ended
|
||||||||||||||||||
|
February 3,
2018 |
|
January 28,
2017 |
|
January 30,
2016 |
|
January 31,
2015 |
|
February 1,
2014 |
||||||||||
Selected Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Number of stores open at end of period
|
14,835
|
|
|
14,334
|
|
|
13,851
|
|
|
5,367
|
|
|
4,992
|
|
|||||
Dollar Tree
|
6,650
|
|
|
6,360
|
|
|
5,954
|
|
|
5,367
|
|
|
4,992
|
|
|||||
Family Dollar
|
8,185
|
|
|
7,974
|
|
|
7,897
|
|
|
—
|
|
|
—
|
|
|||||
Gross square footage at end of period
|
143.9
|
|
|
138.8
|
|
|
132.1
|
|
|
58.3
|
|
|
54.3
|
|
|||||
Dollar Tree
|
71.6
|
|
|
68.5
|
|
|
64.2
|
|
|
58.3
|
|
|
54.3
|
|
|||||
Family Dollar
|
72.3
|
|
|
70.3
|
|
|
67.9
|
|
|
—
|
|
|
—
|
|
|||||
Selling square footage at end of period
|
116.6
|
|
|
112.4
|
|
|
108.4
|
|
|
46.5
|
|
|
43.2
|
|
|||||
Dollar Tree
|
57.3
|
|
|
54.7
|
|
|
51.3
|
|
|
46.5
|
|
|
43.2
|
|
|||||
Family Dollar
|
59.3
|
|
|
57.7
|
|
|
57.1
|
|
|
—
|
|
|
—
|
|
|||||
Selling square footage annual growth
(2)
|
3.7
|
%
|
|
3.7
|
%
|
|
10.3
|
%
|
|
7.4
|
%
|
|
6.9
|
%
|
|||||
Net sales annual growth
(1)
|
7.4
|
%
|
|
8.6
|
%
|
|
8.5
|
%
|
|
9.7
|
%
|
|
6.0
|
%
|
|||||
Comparable store net sales increase
(1)
|
1.9
|
%
|
|
1.8
|
%
|
|
2.1
|
%
|
|
4.3
|
%
|
|
2.4
|
%
|
|||||
Net sales per selling square foot
(2)
|
$
|
194
|
|
|
$
|
188
|
|
|
$
|
191
|
|
|
$
|
192
|
|
|
$
|
187
|
|
Net sales per store
(2)
|
$
|
1.5
|
|
|
$
|
1.5
|
|
|
$
|
1.6
|
|
|
$
|
1.7
|
|
|
$
|
1.6
|
|
Selected Financial Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Return on assets
(2)
|
10.7
|
%
|
|
5.7
|
%
|
|
11.4
|
%
|
|
19.1
|
%
|
|
21.6
|
%
|
|||||
Return on equity
(2)
|
27.3
|
%
|
|
18.3
|
%
|
|
31.5
|
%
|
|
40.5
|
%
|
|
42.1
|
%
|
|||||
Inventory turns
(2)
|
4.4
|
|
|
4.1
|
|
|
4.5
|
|
|
4.4
|
|
|
4.1
|
|
•
|
what factors affect our business;
|
•
|
what our net sales, earnings, gross margins and costs were in
2017
,
2016
and
2015
;
|
•
|
why those net sales, earnings, gross margins and costs were different from the year before;
|
•
|
how all of this affects our overall financial condition;
|
•
|
what our expenditures for capital projects were in
2017
and
2016
and what we expect them to be in
2018
; and
|
•
|
where funds will come from to pay for future expenditures.
|
•
|
On February 23, 2015, we completed the offering of $3.25 billion of acquisition notes which we used in connection with our financing of the acquisition of Family Dollar Stores, Inc. ("Family Dollar") (the "Acquisition").
|
•
|
On March 9, 2015, we entered into a credit agreement and term loan facilities and received $3.95 billion under the Term Loan B which we used in connection with our financing of the Acquisition.
|
•
|
On June 11, 2015, we amended the terms of the New Senior Secured Credit Facilities to refinance the existing $3.95 billion Term Loan B tranche with $3.3 billion in aggregate principal amount of floating-rate Term Loan B-1 and $650.0 million in aggregate principal amount of fixed-rate Term Loan B-2.
|
•
|
On July 6, 2015, we repaid all amounts outstanding under our Senior Notes issued in 2013.
|
•
|
On July 6, 2015 (the "Acquisition Date"), we completed our acquisition of Family Dollar.
|
•
|
On January 26, 2016, we prepaid $1.0 billion of the $3.3 billion Term Loan B-1.
|
•
|
In May 2016, we completed construction of a new 1.5 million square foot distribution center in Cherokee County, South Carolina.
|
•
|
In August 2016, we completed a 0.3 million square foot expansion of our distribution center in Stockton, California. The Stockton distribution center is now an 854,000 square foot, automated facility.
|
•
|
On August 4, 2016, we announced the elimination of 370 positions, including 100 vacant positions, at our Family Dollar store support center in Matthews, North Carolina. The eliminations were part of the establishment of shared services and our ongoing efforts to achieve $300 million in combined run rate annual synergies by the end of July 2018.
|
•
|
On August 30, 2016, we amended the terms of the New Senior Secured Credit Facilities to reduce the applicable interest rate margin of the Term Loan A tranche and our New Revolving Credit Facility.
|
•
|
On September 22, 2016, we amended the terms of the New Senior Secured Credit Facilities to provide for the incurrence of $1,275.0 million in aggregate principal amount of additional loans under the Term Loan A-1 tranche and $750.0 million in aggregate principal amount of Term Loan B-3. In addition, we used $242.0 million of cash on hand to prepay the remainder of the Term Loan B-1.
|
•
|
In October 2016, we began construction on a 320,000 square foot expansion of our Chesapeake, Virginia Store Support Center.
|
•
|
On January 20, 2017, we prepaid the $748.1 million remaining outstanding under the Term Loan B-3.
|
•
|
In June 2017, we began construction of a new 1.0 million square foot distribution center in Warrensburg, Missouri, which is expected to be operational in the third quarter of 2018.
|
•
|
On July 27, 2017, we prepaid $500.0 million of the then outstanding $2.2 billion under the Term Loan A-1.
|
•
|
On December 22, 2017, the Tax Cuts and Jobs Act ("TCJA") was signed into law which lowered the federal corporate tax rate from 35% to 21% and made numerous other law changes, effective as of January 1, 2018.
|
•
|
On January 30, 2018, we provided an irrevocable notice to the 2020 Notes holders to call the $750.0 million 2020 Notes on March 1, 2018. In connection with the early redemption of the 2020 Notes, we recorded a make-whole premium of $9.8 million which was payable on the call date of March 1, 2018. We paid the $759.8 million on March 1, 2018. The remaining $6.1 million of amortizable non-cash deferred financing costs at February 3, 2018 were fully expensed at the call date of March 1, 2018.
|
|
Year Ended
|
||||||||||||||||
|
February 3, 2018
|
|
January 28, 2017
|
||||||||||||||
|
Dollar Tree
|
|
Family Dollar
|
|
Total
|
|
Dollar Tree
|
|
Family Dollar
|
|
Total
|
||||||
Store Count:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Beginning
|
6,360
|
|
|
7,974
|
|
|
14,334
|
|
|
5,954
|
|
|
7,897
|
|
|
13,851
|
|
New stores
|
315
|
|
|
288
|
|
|
603
|
|
|
359
|
|
|
225
|
|
|
584
|
|
Rebannered stores
|
—
|
|
|
—
|
|
|
—
|
|
|
91
|
|
|
(91
|
)
|
|
—
|
|
Closings
|
(25
|
)
|
|
(77
|
)
|
|
(102
|
)
|
|
(44
|
)
|
|
(57
|
)
|
|
(101
|
)
|
Ending
|
6,650
|
|
|
8,185
|
|
|
14,835
|
|
|
6,360
|
|
|
7,974
|
|
|
14,334
|
|
Relocations
|
82
|
|
|
31
|
|
|
113
|
|
|
64
|
|
|
120
|
|
|
184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling Square Feet (in millions):
|
|
|
|
|
|
|
|
|
|
|
|||||||
Beginning
|
54.7
|
|
|
57.7
|
|
|
112.4
|
|
|
51.3
|
|
|
57.1
|
|
|
108.4
|
|
New stores
|
2.6
|
|
|
2.1
|
|
|
4.7
|
|
|
2.9
|
|
|
1.6
|
|
|
4.5
|
|
Rebannered stores
|
—
|
|
|
—
|
|
|
—
|
|
|
0.7
|
|
|
(0.7
|
)
|
|
—
|
|
Closings
|
(0.2
|
)
|
|
(0.5
|
)
|
|
(0.7
|
)
|
|
(0.3
|
)
|
|
(0.4
|
)
|
|
(0.7
|
)
|
Relocations
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
Ending
|
57.3
|
|
|
59.3
|
|
|
116.6
|
|
|
54.7
|
|
|
57.7
|
|
|
112.4
|
|
|
|
Year Ended
|
|||||||
|
|
February 3,
2018 |
|
January 28,
2017 |
|
January 30,
2016 |
|||
Net sales
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
|
68.4
|
%
|
|
69.2
|
%
|
|
69.9
|
%
|
Gross profit
|
|
31.6
|
%
|
|
30.8
|
%
|
|
30.1
|
%
|
Selling, general and administrative expenses
|
|
22.6
|
%
|
|
22.6
|
%
|
|
23.3
|
%
|
Operating income
|
|
9.0
|
%
|
|
8.2
|
%
|
|
6.8
|
%
|
Interest expense, net
|
|
1.3
|
%
|
|
1.8
|
%
|
|
3.9
|
%
|
Other expense, net
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Income before income taxes
|
|
7.7
|
%
|
|
6.4
|
%
|
|
2.9
|
%
|
Provision for income taxes
|
|
—
|
%
|
|
2.1
|
%
|
|
1.1
|
%
|
Net income
|
|
7.7
|
%
|
|
4.3
|
%
|
|
1.8
|
%
|
•
|
lower depreciation costs;
|
•
|
lower store operating costs as a percentage of sales;
|
•
|
higher advertising costs; and,
|
•
|
higher payroll costs.
|
•
|
Increased store hours, including training for associates;
|
•
|
Higher average hourly rates;
|
•
|
Adding Family Dollar eligible associates to the Dollar Tree Retirement Savings Plan starting in fiscal 2017 and increasing contributions in fiscal 2018; and,
|
•
|
Instituting paid maternity leave for eligible associates.
|
•
|
An $89.5 million breakage fee related to the prepayment of the Senior Notes in 2015;
|
•
|
A $39.5 million prepayment fee, a $17.4 million write-off of the original issuance discount and a $5.9 million write-off of deferred financing costs related to the Term Loan B refinancing in 2015;
|
•
|
A $1.0 billion prepayment of Term Loan B-1 principal in the fourth quarter of 2015, which resulted in the accelerated expensing of $19.0 million of amortizable non-cash deferred financing costs in 2015 and lower interest expense in 2016;
|
•
|
An additional $242.0 million prepayment of Term Loan B-1 in the third quarter of 2016 which resulted in lower interest expense in 2016;
|
•
|
The term loans were refinanced in the third quarter of 2016 which resulted in lower interest rates and the accelerated expensing of $26.6 million of amortizable non-cash deferred financing costs and $2.6 million in fees; and,
|
•
|
A $748.1 million prepayment of the remaining principal for Term Loan B-3 in the fourth quarter of 2016, which resulted in the accelerated expensing of $11.7 million of amortizable non-cash deferred financing costs.
|
•
|
lower merchandise cost, due primarily to improved mark-on;
|
•
|
lower occupancy costs resulting primarily from the leverage from the increase in comparable store net sales and the 53rd week; and,
|
•
|
lower shrink expense resulting from improved physical inventory results in the current year.
|
•
|
higher payroll costs, resulting primarily from higher store hourly wages and higher incentive compensation expense; and,
|
•
|
lower depreciation costs and utility costs as a percentage of sales resulting from the leverage from the comparable store net sales increase and sales in the 53rd week.
|
•
|
lower merchandise cost, as a percentage of sales, due to higher initial mark-on and favorable freight costs;
|
•
|
lower markdowns due to Deals markdowns in 2015 in preparation for their conversion to Dollar Tree stores; and,
|
•
|
higher distribution and occupancy costs as a percentage of net sales.
|
•
|
lower merchandise cost, including freight resulting primarily from higher initial mark-on;
|
•
|
lower markdown expense resulting from lower promotional markdowns due to the improved sales performance; and
|
•
|
higher shrink expense.
|
•
|
lower depreciation costs;
|
•
|
lower repairs and maintenance costs as a percentage of sales; and,
|
•
|
higher advertising costs and store supply costs.
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
1,510.2
|
|
|
$
|
1,673.3
|
|
|
$
|
802.5
|
|
Investing activities
|
|
(627.9
|
)
|
|
(483.6
|
)
|
|
(6,978.4
|
)
|
|||
Financing activities
|
|
(651.5
|
)
|
|
(1,060.5
|
)
|
|
6,048.8
|
|
Contractual Obligations
|
Total
|
2018
|
2019
|
2020
|
2021
|
2022
|
Thereafter
|
||||||||||||||
Lease Financing
|
|
|
|
|
|
|
|
||||||||||||||
Operating lease obligations
|
$
|
7,403.2
|
|
$
|
1,381.5
|
|
$
|
1,244.6
|
|
$
|
1,030.3
|
|
$
|
894.6
|
|
$
|
695.8
|
|
$
|
2,156.4
|
|
Long-term Borrowings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Acquisition notes
|
3,250.0
|
|
750.0
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,500.0
|
|
|||||||
Term loans
|
2,182.7
|
|
165.9
|
|
165.9
|
|
1,200.9
|
|
—
|
|
650.0
|
|
—
|
|
|||||||
Assumed secured senior notes
|
300.0
|
|
—
|
|
—
|
|
—
|
|
300.0
|
|
—
|
|
—
|
|
|||||||
Interest on long-term borrowings
|
1,009.7
|
|
247.0
|
|
235.2
|
|
185.8
|
|
170.9
|
|
157.6
|
|
13.2
|
|
|||||||
Total obligations
|
$
|
14,145.6
|
|
$
|
2,544.4
|
|
$
|
1,645.7
|
|
$
|
2,417.0
|
|
$
|
1,365.5
|
|
$
|
1,503.4
|
|
$
|
4,669.6
|
|
Commitments
|
Total
|
Expiring in 2018
|
Expiring in 2019
|
Expiring in 2020
|
Expiring in 2021
|
Expiring in 2022
|
Thereafter
|
||||||||||||||
Letters of credit and surety bonds
|
$
|
412.4
|
|
$
|
383.0
|
|
$
|
29.0
|
|
$
|
0.4
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Purchase obligations
|
130.3
|
|
83.0
|
|
40.0
|
|
4.7
|
|
1.9
|
|
0.7
|
|
—
|
|
|||||||
Total commitments
|
$
|
542.7
|
|
$
|
466.0
|
|
$
|
69.0
|
|
$
|
5.1
|
|
$
|
1.9
|
|
$
|
0.7
|
|
$
|
—
|
|
•
|
The potential future cash flows of the reporting unit.
The projections use management's estimates of economic and market conditions over the projected period, including growth rates in revenue, gross margin and expenses. The cash flows are based on our most recent business operating plans and various growth rates have been assumed for years beyond the current business plan period. We believe that the assumptions and rates used in our fiscal 2017 impairment evaluations are reasonable; however, variations in the assumptions and rates could result in significantly different estimates of fair value.
|
•
|
Selection of an appropriate discount rate.
Calculating the present value of future cash flows requires the selection of an appropriate discount rate, which is based on a weighted-average cost of capital analysis. The discount rate is affected by changes in short-term interest rates and long-term yield as well as variances in the typical capital structure of marketplace participants. Given current economic conditions, it is possible that the discount rate will fluctuate in the near term. We engaged third party experts to assist in the determination of the weighted-average cost of capital used to discount the cash flows for our Family Dollar reporting unit. The weighted-average cost of capital used to discount the cash flows for our evaluation was 9.0% for our fiscal 2017 analysis.
|
Index to Consolidated Financial Statements
|
Page
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Income Statements for the Years Ended February 3, 2018, January 28, 2017 and January 30, 2016
|
|
|
|
Consolidated Statements of Comprehensive Income for the Years Ended February 3, 2018, January 28, 2017 and January 30, 2016
|
|
|
|
Consolidated Balance Sheets as of February 3, 2018 and January 28, 2017
|
|
|
|
Consolidated Statements of Shareholders' Equity for the Years Ended February 3, 2018, January 28, 2017 and January 30, 2016
|
|
|
|
Consolidated Statements of Cash Flows for the Years Ended February 3, 2018, January 28, 2017 and January 30, 2016
|
|
|
|
Notes to Consolidated Financial Statements
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net sales
|
|
$
|
22,245.5
|
|
|
$
|
20,719.2
|
|
|
$
|
15,498.4
|
|
Cost of sales
|
|
15,223.6
|
|
|
14,324.5
|
|
|
10,841.7
|
|
|||
Gross profit
|
|
7,021.9
|
|
|
6,394.7
|
|
|
4,656.7
|
|
|||
Selling, general and administrative expenses, excluding Receivable
impairment
|
|
5,004.3
|
|
|
4,689.9
|
|
|
3,607.0
|
|
|||
Receivable impairment
|
|
18.5
|
|
|
—
|
|
|
—
|
|
|||
Selling, general and administrative expenses
|
|
5,022.8
|
|
|
4,689.9
|
|
|
3,607.0
|
|
|||
Operating income
|
|
1,999.1
|
|
|
1,704.8
|
|
|
1,049.7
|
|
|||
Interest expense, net
|
|
301.8
|
|
|
375.5
|
|
|
599.4
|
|
|||
Other (income) expense, net
|
|
(6.7
|
)
|
|
(0.1
|
)
|
|
2.1
|
|
|||
Income before income taxes
|
|
1,704.0
|
|
|
1,329.4
|
|
|
448.2
|
|
|||
Provision for income taxes
|
|
(10.3
|
)
|
|
433.2
|
|
|
165.8
|
|
|||
Net income
|
|
$
|
1,714.3
|
|
|
$
|
896.2
|
|
|
$
|
282.4
|
|
Basic net income per share
|
|
$
|
7.24
|
|
|
$
|
3.80
|
|
|
$
|
1.27
|
|
Diluted net income per share
|
|
$
|
7.21
|
|
|
$
|
3.78
|
|
|
$
|
1.26
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
|
$
|
1,714.3
|
|
|
$
|
896.2
|
|
|
$
|
282.4
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
5.3
|
|
|
5.5
|
|
|
(9.0
|
)
|
|||
|
|
|
|
|
|
|
||||||
Total comprehensive income
|
|
$
|
1,719.6
|
|
|
$
|
901.7
|
|
|
$
|
273.4
|
|
(in millions, except share and per share data)
|
|
February 3, 2018
|
|
January 28, 2017
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,097.8
|
|
|
$
|
866.4
|
|
Short-term investments
|
|
—
|
|
|
4.0
|
|
||
Merchandise inventories, net
|
|
3,169.3
|
|
|
2,865.8
|
|
||
Other current assets
|
|
309.2
|
|
|
201.8
|
|
||
Total current assets
|
|
4,576.3
|
|
|
3,938.0
|
|
||
Property, plant and equipment, net of accumulated depreciation of $3,192.1 and $2,694.5,
respectively
|
|
3,200.7
|
|
|
3,115.8
|
|
||
Assets available for sale
|
|
8.0
|
|
|
9.0
|
|
||
Goodwill
|
|
5,025.2
|
|
|
5,023.5
|
|
||
Favorable lease rights, net of accumulated amortization of $230.9 and $159.3, respectively
|
|
375.3
|
|
|
468.6
|
|
||
Tradename intangible asset
|
|
3,100.0
|
|
|
3,100.0
|
|
||
Other intangible assets, net
|
|
4.8
|
|
|
5.1
|
|
||
Other assets
|
|
42.5
|
|
|
41.6
|
|
||
Total assets
|
|
$
|
16,332.8
|
|
|
$
|
15,701.6
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Current portion of long-term debt
|
|
$
|
915.9
|
|
|
$
|
152.1
|
|
Accounts payable
|
|
1,174.8
|
|
|
1,119.6
|
|
||
Income taxes payable
|
|
31.5
|
|
|
90.0
|
|
||
Other current liabilities
|
|
736.9
|
|
|
744.2
|
|
||
Total current liabilities
|
|
2,859.1
|
|
|
2,105.9
|
|
||
Long-term debt, net, excluding current portion
|
|
4,762.1
|
|
|
6,169.7
|
|
||
Unfavorable lease rights, net of accumulated amortization of $61.1 and $39.6, respectively
|
|
100.0
|
|
|
124.0
|
|
||
Deferred tax liabilities, net
|
|
985.2
|
|
|
1,458.9
|
|
||
Income taxes payable, long-term
|
|
43.8
|
|
|
71.2
|
|
||
Other liabilities
|
|
400.3
|
|
|
382.4
|
|
||
Total liabilities
|
|
9,150.5
|
|
|
10,312.1
|
|
||
Commitments and contingencies
|
|
|
|
|
|
|
||
Shareholders' equity:
|
|
|
|
|
|
|
||
Common stock, par value $0.01; 600,000,000 shares authorized, 237,325,963 and
236,136,439 shares issued and outstanding at February 3, 2018 and January 28, 2017,
respectively
|
|
2.4
|
|
|
2.4
|
|
||
Additional paid-in capital
|
|
2,545.3
|
|
|
2,472.1
|
|
||
Accumulated other comprehensive loss
|
|
(32.3
|
)
|
|
(37.6
|
)
|
||
Retained earnings
|
|
4,666.9
|
|
|
2,952.6
|
|
||
Total shareholders' equity
|
|
7,182.3
|
|
|
5,389.5
|
|
||
Total liabilities and shareholders' equity
|
|
$
|
16,332.8
|
|
|
$
|
15,701.6
|
|
(in millions)
|
|
Common
Stock
Shares
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Share-
holders'
Equity
|
|||||||||||
Balance at January 31, 2015
|
|
205.7
|
|
|
$
|
2.1
|
|
|
$
|
43.0
|
|
|
$
|
(34.1
|
)
|
|
$
|
1,774.0
|
|
|
$
|
1,785.0
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
282.4
|
|
|
282.4
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9.0
|
)
|
|
—
|
|
|
(9.0
|
)
|
|||||
Acquisition of Family Dollar
|
|
28.5
|
|
|
0.3
|
|
|
2,289.8
|
|
|
—
|
|
|
—
|
|
|
2,290.1
|
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
5.1
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
|||||
Exercise of stock options, including
income tax benefit of $0.7
|
|
0.3
|
|
|
—
|
|
|
9.5
|
|
|
—
|
|
|
—
|
|
|
9.5
|
|
|||||
Stock-based compensation, net, including
income tax benefit of $12.1
|
|
0.4
|
|
|
—
|
|
|
43.8
|
|
|
—
|
|
|
—
|
|
|
43.8
|
|
|||||
Balance at January 30, 2016
|
|
235.0
|
|
|
2.4
|
|
|
2,391.2
|
|
|
(43.1
|
)
|
|
2,056.4
|
|
|
4,406.9
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
896.2
|
|
|
896.2
|
|
|||||
Total other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
8.0
|
|
|
—
|
|
|
—
|
|
|
8.0
|
|
|||||
Exercise of stock options
|
|
0.6
|
|
|
—
|
|
|
33.5
|
|
|
—
|
|
|
—
|
|
|
33.5
|
|
|||||
Stock-based compensation, net
|
|
0.4
|
|
|
—
|
|
|
39.4
|
|
|
—
|
|
|
—
|
|
|
39.4
|
|
|||||
Balance at January 28, 2017
|
|
236.1
|
|
|
2.4
|
|
|
2,472.1
|
|
|
(37.6
|
)
|
|
2,952.6
|
|
|
5,389.5
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,714.3
|
|
|
1,714.3
|
|
|||||
Total other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.3
|
|
|
—
|
|
|
5.3
|
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
0.2
|
|
|
—
|
|
|
8.4
|
|
|
—
|
|
|
—
|
|
|
8.4
|
|
|||||
Exercise of stock options
|
|
0.5
|
|
|
—
|
|
|
26.6
|
|
|
—
|
|
|
—
|
|
|
26.6
|
|
|||||
Stock-based compensation, net
|
|
0.5
|
|
|
—
|
|
|
38.2
|
|
|
—
|
|
|
—
|
|
|
38.2
|
|
|||||
Balance at February 3, 2018
|
|
237.3
|
|
|
$
|
2.4
|
|
|
$
|
2,545.3
|
|
|
$
|
(32.3
|
)
|
|
$
|
4,666.9
|
|
|
$
|
7,182.3
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
1,714.3
|
|
|
$
|
896.2
|
|
|
$
|
282.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
611.2
|
|
|
637.5
|
|
|
487.6
|
|
|||
Provision for deferred income taxes
|
|
(473.5
|
)
|
|
(124.1
|
)
|
|
25.6
|
|
|||
Stock-based compensation expense
|
|
65.7
|
|
|
61.6
|
|
|
53.2
|
|
|||
Amortization of debt discount and debt-issuance costs
|
|
15.4
|
|
|
55.2
|
|
|
64.7
|
|
|||
Receivable impairment
|
|
18.5
|
|
|
—
|
|
|
—
|
|
|||
Other non-cash adjustments to net income
|
|
10.9
|
|
|
9.4
|
|
|
7.7
|
|
|||
Changes in assets and liabilities increasing (decreasing) cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|||
Merchandise inventories
|
|
(300.9
|
)
|
|
21.9
|
|
|
(87.8
|
)
|
|||
Prepaids and other current assets
|
|
(114.6
|
)
|
|
117.2
|
|
|
(63.5
|
)
|
|||
Accounts payable
|
|
54.5
|
|
|
(133.8
|
)
|
|
183.9
|
|
|||
Income taxes payable
|
|
(58.5
|
)
|
|
77.1
|
|
|
3.1
|
|
|||
Other current liabilities
|
|
(22.7
|
)
|
|
30.4
|
|
|
(164.1
|
)
|
|||
Other liabilities
|
|
(10.1
|
)
|
|
24.7
|
|
|
9.7
|
|
|||
Net cash provided by operating activities
|
|
1,510.2
|
|
|
1,673.3
|
|
|
802.5
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
|
(632.2
|
)
|
|
(564.7
|
)
|
|
(480.5
|
)
|
|||
Acquisition of Family Dollar, net of common stock issued, equity compensation and cash
acquired |
|
—
|
|
|
—
|
|
|
(6,527.7
|
)
|
|||
Purchase of restricted cash and investments
|
|
—
|
|
|
(36.1
|
)
|
|
(23.7
|
)
|
|||
Proceeds from sale of restricted and unrestricted investments
|
|
4.0
|
|
|
118.1
|
|
|
53.0
|
|
|||
Proceeds from (payments for) fixed asset disposition
|
|
0.3
|
|
|
(0.9
|
)
|
|
0.5
|
|
|||
Net cash used in investing activities
|
|
(627.9
|
)
|
|
(483.6
|
)
|
|
(6,978.4
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Principal payments for long-term debt
|
|
(659.1
|
)
|
|
(4,036.2
|
)
|
|
(5,926.7
|
)
|
|||
Proceeds from long-term debt, net of discount
|
|
—
|
|
|
2,962.5
|
|
|
12,130.2
|
|
|||
Debt-issuance costs
|
|
—
|
|
|
(6.1
|
)
|
|
(159.8
|
)
|
|||
Repayments of revolving credit facility
|
|
—
|
|
|
(140.0
|
)
|
|
—
|
|
|||
Proceeds from revolving credit facility
|
|
—
|
|
|
140.0
|
|
|
—
|
|
|||
Proceeds from stock issued pursuant to stock-based compensation plans
|
|
35.0
|
|
|
41.5
|
|
|
13.9
|
|
|||
Cash paid for taxes on exercises/vesting of stock-based compensation
|
|
(27.4
|
)
|
|
(22.2
|
)
|
|
(21.6
|
)
|
|||
Tax benefit of exercises/vesting of stock-based compensation
|
|
—
|
|
|
—
|
|
|
12.8
|
|
|||
Net cash provided by (used in) financing activities
|
|
(651.5
|
)
|
|
(1,060.5
|
)
|
|
6,048.8
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
0.6
|
|
|
1.1
|
|
|
(0.9
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
231.4
|
|
|
130.3
|
|
|
(128.0
|
)
|
|||
Cash and cash equivalents at beginning of year
|
|
866.4
|
|
|
736.1
|
|
|
864.1
|
|
|||
Cash and cash equivalents at end of year
|
|
$
|
1,097.8
|
|
|
$
|
866.4
|
|
|
$
|
736.1
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for:
|
|
|
|
|
|
|
|
|
|
|||
Interest, net of amounts capitalized
|
|
$
|
286.5
|
|
|
$
|
329.1
|
|
|
$
|
487.0
|
|
Income taxes
|
|
$
|
552.4
|
|
|
$
|
501.8
|
|
|
$
|
138.4
|
|
Non-cash transactions:
|
|
|
|
|
|
|
||||||
Accrued capital expenditures
|
|
$
|
45.0
|
|
|
$
|
30.3
|
|
|
$
|
72.4
|
|
Acquisition cost paid in common stock and equity compensation
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,290.1
|
|
Buildings
|
39 to 40 years
|
Furniture, fixtures and equipment
|
3 to 15 years
|
(in millions)
|
|
February 3,
2018 |
|
January 28,
2017 |
||||
Level 1
|
|
|
|
|
||||
Short-term investments
|
|
$
|
—
|
|
|
$
|
4.0
|
|
Deferred compensation plan assets
|
|
20.7
|
|
|
19.8
|
|
||
Long-term debt - Secured Senior Notes and Acquisition Notes
|
|
3,684.6
|
|
|
3,740.3
|
|
||
Level 2
|
|
|
|
|
||||
Long-term debt - term loans
|
|
2,187.6
|
|
|
2,828.2
|
|
•
|
Savings from sourcing and procurement of merchandise and non-merchandise goods and services driven by leveraging the combined volume of the Dollar Tree and Family Dollar banners, among other things;
|
•
|
Rebannering to optimize store formats;
|
•
|
A reduction in overhead and corporate selling, general and administrative expenses by eliminating redundant positions and optimizing processes; and
|
•
|
Savings resulting from the optimization of distribution and logistics networks.
|
|
|
Pro Forma - Unaudited
|
||
|
|
Year Ended
|
||
(in millions, except per share data)
|
|
January 30, 2016
|
||
Net sales
|
|
$
|
19,782.3
|
|
Net income
|
|
$
|
565.7
|
|
Basic net income per share
|
|
$
|
2.41
|
|
Diluted net income per share
|
|
$
|
2.40
|
|
|
|
February 3,
|
|
January 28,
|
||||
(in millions)
|
|
2018
|
|
2017
|
||||
Land
|
|
$
|
208.0
|
|
|
$
|
193.8
|
|
Buildings
|
|
1,092.5
|
|
|
1,044.9
|
|
||
Leasehold improvements
|
|
1,860.2
|
|
|
1,690.2
|
|
||
Furniture, fixtures and equipment
|
|
3,003.3
|
|
|
2,735.4
|
|
||
Construction in progress
|
|
228.8
|
|
|
146.0
|
|
||
Total property, plant and equipment
|
|
6,392.8
|
|
|
5,810.3
|
|
||
Less: accumulated depreciation
|
|
3,192.1
|
|
|
2,694.5
|
|
||
Total property, plant and equipment, net
|
|
$
|
3,200.7
|
|
|
$
|
3,115.8
|
|
|
|
February 3,
|
|
January 28,
|
||||
(in millions)
|
|
2018
|
|
2017
|
||||
Prepaid rent
|
|
$
|
138.3
|
|
|
$
|
1.9
|
|
Other accounts receivable
|
|
90.4
|
|
|
82.0
|
|
||
Prepaid store supplies
|
|
47.1
|
|
|
38.6
|
|
||
Other prepaid assets
|
|
33.4
|
|
|
23.4
|
|
||
Accounts receivable - divestiture-related
|
|
—
|
|
|
55.9
|
|
||
Total other current assets
|
|
$
|
309.2
|
|
|
$
|
201.8
|
|
|
|
February 3,
|
|
January 28,
|
||||
(in millions)
|
|
2018
|
|
2017
|
||||
Taxes (other than income taxes)
|
|
$
|
176.6
|
|
|
$
|
163.1
|
|
Compensation and benefits
|
|
155.2
|
|
|
194.9
|
|
||
Insurance
|
|
105.4
|
|
|
101.7
|
|
||
Accrued interest
|
|
91.1
|
|
|
84.7
|
|
||
Accrued construction costs
|
|
45.0
|
|
|
30.3
|
|
||
Rent liabilities
|
|
34.1
|
|
|
36.1
|
|
||
Accrued utility expenses
|
|
23.9
|
|
|
21.2
|
|
||
Accrued repairs
|
|
18.8
|
|
|
18.3
|
|
||
Other
|
|
86.8
|
|
|
93.9
|
|
||
Total other current liabilities
|
|
$
|
736.9
|
|
|
$
|
744.2
|
|
|
|
February 3,
|
|
January 28,
|
||||
(in millions)
|
|
2018
|
|
2017
|
||||
Insurance
|
|
$
|
230.2
|
|
|
$
|
224.0
|
|
Deferred rent
|
|
136.5
|
|
|
122.6
|
|
||
Other
|
|
33.6
|
|
|
35.8
|
|
||
Total other long-term liabilities
|
|
$
|
400.3
|
|
|
$
|
382.4
|
|
|
|
Year Ended
|
||||||||||
(in millions)
|
|
February 3, 2018
|
|
January 28, 2017
|
|
January 30, 2016
|
||||||
Income from continuing operations
|
|
$
|
(10.3
|
)
|
|
$
|
433.2
|
|
|
$
|
165.8
|
|
Shareholders' equity, tax benefit on exercises/vesting of equity-based
compensation |
|
—
|
|
|
—
|
|
|
(12.8
|
)
|
|||
|
|
$
|
(10.3
|
)
|
|
$
|
433.2
|
|
|
$
|
153.0
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Federal - current
|
|
$
|
439.3
|
|
|
$
|
480.5
|
|
|
$
|
126.9
|
|
State - current
|
|
23.8
|
|
|
79.5
|
|
|
14.6
|
|
|||
Foreign - current
|
|
0.3
|
|
|
0.8
|
|
|
0.5
|
|
|||
Total current
|
|
$
|
463.4
|
|
|
$
|
560.8
|
|
|
$
|
142.0
|
|
|
|
|
|
|
|
|
||||||
Federal - deferred
|
|
(456.0
|
)
|
|
(37.7
|
)
|
|
7.4
|
|
|||
State - deferred
|
|
(17.7
|
)
|
|
(89.9
|
)
|
|
3.3
|
|
|||
Foreign - deferred
|
|
—
|
|
|
—
|
|
|
13.1
|
|
|||
Total deferred
|
|
$
|
(473.7
|
)
|
|
$
|
(127.6
|
)
|
|
$
|
23.8
|
|
|
|
Year Ended
|
|||||||
|
|
February 3, 2018
|
|
January 28, 2017
|
|
January 30, 2016
|
|||
Statutory tax rate
|
|
33.7
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Effect of:
|
|
|
|
|
|
|
|
|
|
State and local income taxes, net of federal income tax benefit
|
|
2.5
|
|
|
3.0
|
|
|
3.0
|
|
Work Opportunity Tax Credit
|
|
(1.3
|
)
|
|
(1.6
|
)
|
|
(3.8
|
)
|
State tax election
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
Deferred tax rate change
|
|
(0.6
|
)
|
|
(1.6
|
)
|
|
—
|
|
Incremental tax benefit of exercises/vesting of equity-based
compensation |
|
(0.8
|
)
|
|
(0.6
|
)
|
|
—
|
|
International taxes
|
|
—
|
|
|
—
|
|
|
(4.5
|
)
|
Change in valuation allowance
|
|
(0.1
|
)
|
|
0.1
|
|
|
4.1
|
|
Nondeductible acquisition costs
|
|
—
|
|
|
—
|
|
|
1.5
|
|
Tax Cuts and Jobs Act
|
|
(33.0
|
)
|
|
—
|
|
|
—
|
|
Other, net
|
|
(1.0
|
)
|
|
(0.3
|
)
|
|
1.7
|
|
Effective tax rate
|
|
(0.6
|
)%
|
|
32.6
|
%
|
|
37.0
|
%
|
•
|
Net Deferred Tax Liability Valuation.
The valuation of the net deferred tax liability is dependent upon the future tax rate. While the Company is able to make a reasonable estimate of the impact of the reduction in the statutory federal corporate tax rate, the rate may be affected by other analyses related to the TCJA including, but not limited to, federal temporary differences resulting from accounting method changes or other adjustments.
|
•
|
Acceleration of Depreciation.
While the Company has not completed its determination of all capital expenditures that qualify for immediate expensing, the Company recorded a provisional benefit for the year ended February 3, 2018 based on its current intent to fully expense all qualifying expenditures.
|
•
|
Executive Compensation.
Effective for tax years beginning after December 31, 2017, the performance-based compensation exception to the
$1.0 million
deduction limitation of Internal Revenue Code Section 162(m) was repealed and the
|
•
|
Effect of State Taxes.
The Company remeasured certain deferred tax assets and liabilities to account for the reduction in the future federal benefit from state deferred tax assets and liabilities. The Company was able to make a reasonable estimate of the impact of the TCJA on state taxes. However, at this stage it is unclear how many states will incorporate the federal law changes, or portions thereof, into their tax codes from the TCJA. Future guidance from states could result in changes to the Company's accounting for the tax effects of the TCJA.
|
•
|
Global Intangible Low-Taxed Income ("GILTI").
The Company has not yet made a policy election with respect to its treatment of potential GILTI. Companies can either account for taxes on GILTI as incurred or recognize deferred taxes when basis differences exist that are expected to affect the amount of the GILTI inclusion upon reversal. The Company is still in the process of analyzing the provisions of the TCJA associated with GILTI and the expected impact of GILTI on the Company in the future.
|
(in millions)
|
|
February 3,
2018 |
|
January 28,
2017 |
||||
Deferred tax assets:
|
|
|
|
|
||||
Deferred rent
|
|
$
|
42.7
|
|
|
$
|
59.9
|
|
Accrued expenses
|
|
17.8
|
|
|
71.4
|
|
||
Net operating losses and credit carryforwards
|
|
75.6
|
|
|
71.4
|
|
||
Accrued compensation expense
|
|
23.2
|
|
|
71.3
|
|
||
State tax election
|
|
22.8
|
|
|
20.4
|
|
||
Other
|
|
—
|
|
|
3.4
|
|
||
Total deferred tax assets
|
|
182.1
|
|
|
297.8
|
|
||
Valuation allowance
|
|
(38.6
|
)
|
|
(49.7
|
)
|
||
Deferred tax assets, net
|
|
143.5
|
|
|
248.1
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|
|
||
Property and equipment
|
|
(218.5
|
)
|
|
(331.3
|
)
|
||
Other intangibles
|
|
(880.5
|
)
|
|
(1,368.7
|
)
|
||
Inventory
|
|
(27.1
|
)
|
|
(7.0
|
)
|
||
Other
|
|
(2.6
|
)
|
|
—
|
|
||
Total deferred tax liabilities
|
|
(1,128.7
|
)
|
|
(1,707.0
|
)
|
||
Net deferred tax liability
|
|
$
|
(985.2
|
)
|
|
$
|
(1,458.9
|
)
|
(in millions)
|
|
February 3, 2018
|
|
January 28, 2017
|
||||
Beginning Balance
|
|
$
|
71.2
|
|
|
$
|
71.4
|
|
Additions, based on tax positions related to current year
|
|
2.5
|
|
|
5.9
|
|
||
Additions for tax positions of prior years
|
|
9.8
|
|
|
3.7
|
|
||
Reductions for tax positions of prior years
|
|
(31.7
|
)
|
|
—
|
|
||
Settlements
|
|
(2.9
|
)
|
|
(2.2
|
)
|
||
Lapses in statutes of limitation
|
|
(5.1
|
)
|
|
(7.6
|
)
|
||
Ending balance
|
|
$
|
43.8
|
|
|
$
|
71.2
|
|
|
(in millions)
|
||
2018
|
$
|
1,381.5
|
|
2019
|
1,244.6
|
|
|
2020
|
1,030.3
|
|
|
2021
|
894.6
|
|
|
2022
|
695.8
|
|
|
Thereafter
|
2,156.4
|
|
|
Total minimum lease payments
|
$
|
7,403.2
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Minimum rentals
|
|
$
|
1,343.5
|
|
|
$
|
1,276.6
|
|
|
$
|
993.6
|
|
Contingent rentals
|
|
5.2
|
|
|
6.3
|
|
|
5.5
|
|
|
|
As of February 3, 2018
|
|
As of January 28, 2017
|
||||||||||||
(in millions)
|
|
Principal
|
|
Unamortized Debt Premium and Issuance Costs
|
|
Principal
|
|
Unamortized Debt Premium and Issuance Costs
|
||||||||
Forgivable Promissory Note
|
|
—
|
|
|
—
|
|
|
7.0
|
|
|
—
|
|
||||
5.25% Acquisition Notes, due 2020
|
|
750.0
|
|
|
6.1
|
|
|
750.0
|
|
|
8.7
|
|
||||
5.75% Acquisition Notes, due 2023
|
|
2,500.0
|
|
|
30.8
|
|
|
2,500.0
|
|
|
35.9
|
|
||||
Term Loan A-1, interest payable at LIBOR, plus 1.50%,
which was 3.08% at February 3, 2018
|
|
1,532.7
|
|
|
3.4
|
|
|
2,184.8
|
|
|
6.2
|
|
||||
Term Loan B-2, fixed interest rate of 4.25%
|
|
650.0
|
|
|
8.6
|
|
|
650.0
|
|
|
10.4
|
|
||||
Secured Senior Notes, fixed interest rate of 5.00%
|
|
300.0
|
|
|
(6.8
|
)
|
|
300.0
|
|
|
(8.8
|
)
|
||||
$1.25 billion Tranche A Revolving Credit Facility, interest
payable at LIBOR, plus 1.50%, which was 3.08% at
February 3, 2018
|
|
—
|
|
|
12.6
|
|
|
—
|
|
|
17.6
|
|
||||
Total
|
|
$
|
5,732.7
|
|
|
$
|
54.7
|
|
|
$
|
6,391.8
|
|
|
$
|
70.0
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Basic net income per share:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
1,714.3
|
|
|
$
|
896.2
|
|
|
$
|
282.4
|
|
Weighted average number of shares outstanding
|
|
236.8
|
|
|
235.7
|
|
|
222.5
|
|
|||
Basic net income per share
|
|
$
|
7.24
|
|
|
$
|
3.80
|
|
|
$
|
1.27
|
|
Diluted net income per share:
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
1,714.3
|
|
|
$
|
896.2
|
|
|
$
|
282.4
|
|
Weighted average number of shares outstanding
|
|
236.8
|
|
|
235.7
|
|
|
222.5
|
|
|||
Dilutive effect of stock options and restricted stock (as determined by
applying the treasury stock method) |
|
0.9
|
|
|
1.1
|
|
|
1.0
|
|
|||
Weighted average number of shares and dilutive potential shares
outstanding |
|
237.7
|
|
|
236.8
|
|
|
223.5
|
|
|||
Diluted net income per share
|
|
$
|
7.21
|
|
|
$
|
3.78
|
|
|
$
|
1.26
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Dollar Tree Retirement Savings Plan, formerly Dollar Tree
Inc. Affiliates and Subsidiaries Profit Sharing and 401(k)
Retirement Plan
|
|
$
|
52.9
|
|
|
$
|
39.9
|
|
|
$
|
36.6
|
|
Family Dollar Employee Savings and Retirement Plan and
Trust |
|
—
|
|
|
9.2
|
|
|
6.2
|
|
|||
Total
|
|
$
|
52.9
|
|
|
$
|
49.1
|
|
|
$
|
42.8
|
|
|
20% after two years of service
|
|
40% after three years of service
|
|
60% after four years of service
|
|
100% after five years of service
|
|
|
Shares
|
|
Weighted
Average
Grant
Date Fair
Value
|
|||
Nonvested at January 28, 2017
|
|
1,619,501
|
|
|
$
|
73.43
|
|
Granted
|
|
890,371
|
|
|
78.63
|
|
|
Vested
|
|
(891,791
|
)
|
|
67.61
|
|
|
Forfeited
|
|
(92,829
|
)
|
|
79.21
|
|
|
Nonvested at February 3, 2018
|
|
1,525,252
|
|
|
$
|
79.37
|
|
|
|
Fiscal 2016
|
|
Fiscal 2015
|
||||
Expected term in years
|
|
6.50
|
|
|
2.03
|
|
||
Expected volatility
|
|
24.51
|
%
|
|
20.77
|
%
|
||
Annual dividend yield
|
|
—
|
%
|
|
—
|
%
|
||
Risk free interest rate
|
|
2.09
|
%
|
|
0.60
|
%
|
||
Weighted-average fair value of options granted
during the period
|
|
$
|
22.10
|
|
|
$
|
23.15
|
|
Stock Option Activity
|
|||||||||||||
|
|
February 3, 2018
|
|||||||||||
|
|
|
|
Weighted
|
|
|
|
|
|||||
|
|
|
|
Average
|
|
Weighted
|
|
Aggregate
|
|||||
|
|
|
|
Per Share
|
|
Average
|
|
Intrinsic
|
|||||
|
|
|
|
Exercise
|
|
Remaining
|
|
Value
|
|||||
|
|
Shares
|
|
Price
|
|
Term
|
|
(in millions)
|
|||||
Outstanding, beginning of period
|
|
1,041,435
|
|
|
$
|
62.38
|
|
|
|
|
|
||
Granted
|
|
8,525
|
|
|
83.54
|
|
|
|
|
|
|||
Exercised
|
|
(494,411
|
)
|
|
53.85
|
|
|
|
|
|
|||
Forfeited
|
|
(32,466
|
)
|
|
73.01
|
|
|
|
|
|
|||
Outstanding, end of period
|
|
523,083
|
|
|
$
|
70.14
|
|
|
5.00
|
|
$
|
20.2
|
|
Options vested at February 3, 2018
|
|
288,698
|
|
|
$
|
66.56
|
|
|
4.25
|
|
$
|
12.2
|
|
Options exercisable at end of period
|
|
288,698
|
|
|
$
|
66.56
|
|
|
4.25
|
|
$
|
12.2
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||
|
|
Options
|
|
|
|
|
|
Options
|
|
|
||||||
Range of
|
|
Outstanding
|
|
Weighted Avg.
|
|
Weighted Avg.
|
|
Exercisable
|
|
Weighted Avg.
|
||||||
Exercise
|
|
at February 3,
|
|
Remaining
|
|
Exercise
|
|
at February 3,
|
|
Exercise
|
||||||
Prices
|
|
2018
|
|
Contractual Life
|
|
Price
|
|
2018
|
|
Price
|
||||||
$19.93 to $48.30
|
|
47,807
|
|
|
3.6
|
|
$
|
32.36
|
|
|
47,807
|
|
|
$
|
32.36
|
|
$48.31 to $68.70
|
|
33,030
|
|
|
2.0
|
|
57.95
|
|
|
30,108
|
|
|
57.53
|
|
||
$68.71 to $76.86
|
|
236,157
|
|
|
1.2
|
|
72.90
|
|
|
54,832
|
|
|
69.10
|
|
||
$76.87 to $78.45
|
|
185,805
|
|
|
6.7
|
|
76.98
|
|
|
138,465
|
|
|
76.98
|
|
||
$78.46 to $107.31
|
|
20,284
|
|
|
6.7
|
|
84.19
|
|
|
17,486
|
|
|
85.06
|
|
||
$19.93 to $107.31
|
|
523,083
|
|
|
5.0
|
|
$
|
70.14
|
|
|
288,698
|
|
|
$
|
66.56
|
|
|
Fiscal 2017
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|||
Expected term
|
3 months
|
|
3 months
|
|
3 months
|
|||
Expected volatility
|
10.9
|
%
|
|
14.6
|
%
|
|
13.2
|
%
|
Annual dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Risk free interest rate
|
1.1
|
%
|
|
0.4
|
%
|
|
0.2
|
%
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net sales:
|
|
|
|
|
|
|
||||||
Dollar Tree
|
|
$
|
11,164.4
|
|
|
$
|
10,138.7
|
|
|
$
|
9,336.4
|
|
Family Dollar
|
|
11,081.1
|
|
|
10,580.5
|
|
|
6,162.0
|
|
|||
Total net sales
|
|
$
|
22,245.5
|
|
|
$
|
20,719.2
|
|
|
$
|
15,498.4
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Gross profit:
|
|
|
|
|
|
|
||||||
Dollar Tree
|
|
$
|
3,998.5
|
|
|
$
|
3,584.7
|
|
|
$
|
3,249.3
|
|
Family Dollar
|
|
3,023.4
|
|
|
2,810.0
|
|
|
1,407.4
|
|
|||
Total gross profit
|
|
$
|
7,021.9
|
|
|
$
|
6,394.7
|
|
|
$
|
4,656.7
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Depreciation and amortization expense:
|
|
|
|
|
|
|
||||||
Dollar Tree
|
|
$
|
251.8
|
|
|
$
|
241.3
|
|
|
$
|
223.4
|
|
Family Dollar
|
|
359.7
|
|
|
396.5
|
|
|
264.3
|
|
|||
Total depreciation and amortization expense
|
|
$
|
611.5
|
|
|
$
|
637.8
|
|
|
$
|
487.7
|
|
|
|
Year Ended
|
||||||||||
|
|
February 3,
|
|
January 28,
|
|
January 30,
|
||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Operating income (loss):
|
|
|
|
|
|
|
||||||
Dollar Tree
|
|
$
|
1,481.9
|
|
|
$
|
1,305.3
|
|
|
$
|
1,080.5
|
|
Family Dollar
|
|
517.2
|
|
|
399.5
|
|
|
(30.8
|
)
|
|||
Total operating income
|
|
$
|
1,999.1
|
|
|
$
|
1,704.8
|
|
|
$
|
1,049.7
|
|
|
|
As of
|
||||||
|
|
February 3,
|
|
January 28,
|
||||
(in millions)
|
|
2018
|
|
2017
|
||||
Total assets:
|
|
|
|
|
||||
Dollar Tree
|
|
$
|
4,113.4
|
|
|
$
|
3,705.5
|
|
Family Dollar
|
|
12,219.4
|
|
|
11,996.1
|
|
||
Total assets
|
|
$
|
16,332.8
|
|
|
$
|
15,701.6
|
|
|
|
As of
|
||||||
|
|
February 3,
|
|
January 28,
|
||||
(in millions)
|
|
2018
|
|
2017
|
||||
Total goodwill:
|
|
|
|
|
||||
Dollar Tree
|
|
$
|
347.1
|
|
|
$
|
345.4
|
|
Family Dollar
|
|
4,678.1
|
|
|
4,678.1
|
|
||
Total goodwill
|
|
$
|
5,025.2
|
|
|
$
|
5,023.5
|
|
|
|
Year Ended February 3, 2018
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidation
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
22,010.0
|
|
|
$
|
358.8
|
|
|
$
|
(123.3
|
)
|
|
$
|
22,245.5
|
|
Cost of sales
|
|
—
|
|
|
15,105.5
|
|
|
173.4
|
|
|
(55.3
|
)
|
|
15,223.6
|
|
|||||
Gross profit
|
|
—
|
|
|
6,904.5
|
|
|
185.4
|
|
|
(68.0
|
)
|
|
7,021.9
|
|
|||||
Selling, general and administrative
expenses
|
|
6.1
|
|
|
4,922.5
|
|
|
162.2
|
|
|
(68.0
|
)
|
|
5,022.8
|
|
|||||
Operating income (loss)
|
|
(6.1
|
)
|
|
1,982.0
|
|
|
23.2
|
|
|
—
|
|
|
1,999.1
|
|
|||||
Interest expense (income), net
|
|
239.8
|
|
|
69.8
|
|
|
(7.8
|
)
|
|
—
|
|
|
301.8
|
|
|||||
Other (income) expense, net
|
|
(0.1
|
)
|
|
(7.5
|
)
|
|
0.9
|
|
|
—
|
|
|
(6.7
|
)
|
|||||
Income before income taxes
|
|
(245.8
|
)
|
|
1,919.7
|
|
|
30.1
|
|
|
—
|
|
|
1,704.0
|
|
|||||
Provision for income taxes
|
|
(113.5
|
)
|
|
87.2
|
|
|
16.0
|
|
|
—
|
|
|
(10.3
|
)
|
|||||
Equity in earnings of subsidiaries
|
|
(1,846.6
|
)
|
|
(14.2
|
)
|
|
—
|
|
|
1,860.8
|
|
|
—
|
|
|||||
Net income
|
|
1,714.3
|
|
|
1,846.7
|
|
|
14.1
|
|
|
(1,860.8
|
)
|
|
1,714.3
|
|
|||||
Other comprehensive income
|
|
5.3
|
|
|
1.6
|
|
|
5.3
|
|
|
(6.9
|
)
|
|
5.3
|
|
|||||
Comprehensive income
|
|
$
|
1,719.6
|
|
|
$
|
1,848.3
|
|
|
$
|
19.4
|
|
|
$
|
(1,867.7
|
)
|
|
$
|
1,719.6
|
|
|
|
Year Ended January 28, 2017
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidation
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
20,506.9
|
|
|
$
|
731.6
|
|
|
$
|
(519.3
|
)
|
|
$
|
20,719.2
|
|
Cost of sales
|
|
—
|
|
|
14,178.1
|
|
|
584.4
|
|
|
(438.0
|
)
|
|
14,324.5
|
|
|||||
Gross profit
|
|
—
|
|
|
6,328.8
|
|
|
147.2
|
|
|
(81.3
|
)
|
|
6,394.7
|
|
|||||
Selling, general and administrative
expenses
|
|
7.4
|
|
|
4,631.0
|
|
|
125.2
|
|
|
(73.7
|
)
|
|
4,689.9
|
|
|||||
Operating (loss) income
|
|
(7.4
|
)
|
|
1,697.8
|
|
|
22.0
|
|
|
(7.6
|
)
|
|
1,704.8
|
|
|||||
Interest expense (income), net
|
|
316.8
|
|
|
66.3
|
|
|
(7.6
|
)
|
|
—
|
|
|
375.5
|
|
|||||
Other (income) expense, net
|
|
7.4
|
|
|
(0.7
|
)
|
|
0.8
|
|
|
(7.6
|
)
|
|
(0.1
|
)
|
|||||
Income (loss) before income taxes
|
|
(331.6
|
)
|
|
1,632.2
|
|
|
28.8
|
|
|
—
|
|
|
1,329.4
|
|
|||||
Provision for income taxes
|
|
(133.3
|
)
|
|
558.8
|
|
|
7.7
|
|
|
—
|
|
|
433.2
|
|
|||||
Equity in earnings of subsidiaries
|
|
(1,094.5
|
)
|
|
(15.4
|
)
|
|
—
|
|
|
1,109.9
|
|
|
—
|
|
|||||
Net income
|
|
896.2
|
|
|
1,088.8
|
|
|
21.1
|
|
|
(1,109.9
|
)
|
|
896.2
|
|
|||||
Other comprehensive income
|
|
5.5
|
|
|
1.7
|
|
|
5.5
|
|
|
(7.2
|
)
|
|
5.5
|
|
|||||
Comprehensive income
|
|
$
|
901.7
|
|
|
$
|
1,090.5
|
|
|
$
|
26.6
|
|
|
$
|
(1,117.1
|
)
|
|
$
|
901.7
|
|
|
|
Year Ended January 30, 2016
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidation
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
Net sales
|
|
$
|
—
|
|
|
$
|
15,312.2
|
|
|
$
|
737.6
|
|
|
$
|
(551.4
|
)
|
|
$
|
15,498.4
|
|
Cost of sales
|
|
—
|
|
|
10,715.6
|
|
|
664.1
|
|
|
(538.0
|
)
|
|
10,841.7
|
|
|||||
Gross profit
|
|
—
|
|
|
4,596.6
|
|
|
73.5
|
|
|
(13.4
|
)
|
|
4,656.7
|
|
|||||
Selling, general and administrative
expenses
|
|
48.4
|
|
|
3,505.5
|
|
|
62.5
|
|
|
(9.4
|
)
|
|
3,607.0
|
|
|||||
Operating (loss) income
|
|
(48.4
|
)
|
|
1,091.1
|
|
|
11.0
|
|
|
(4.0
|
)
|
|
1,049.7
|
|
|||||
Interest expense (income), net
|
|
464.4
|
|
|
139.1
|
|
|
(4.1
|
)
|
|
—
|
|
|
599.4
|
|
|||||
Other (income) expense, net
|
|
4.0
|
|
|
(0.2
|
)
|
|
2.3
|
|
|
(4.0
|
)
|
|
2.1
|
|
|||||
Income (loss) before income taxes
|
|
(516.8
|
)
|
|
952.2
|
|
|
12.8
|
|
|
—
|
|
|
448.2
|
|
|||||
Provision for income taxes
|
|
(213.3
|
)
|
|
361.6
|
|
|
17.5
|
|
|
—
|
|
|
165.8
|
|
|||||
Equity in earnings of subsidiaries
|
|
(585.9
|
)
|
|
(31.1
|
)
|
|
—
|
|
|
617.0
|
|
|
—
|
|
|||||
Net income (loss)
|
|
282.4
|
|
|
621.7
|
|
|
(4.7
|
)
|
|
(617.0
|
)
|
|
282.4
|
|
|||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
(9.0
|
)
|
|
—
|
|
|
(9.0
|
)
|
|||||
Comprehensive income
|
|
$
|
282.4
|
|
|
$
|
621.7
|
|
|
$
|
(13.7
|
)
|
|
$
|
(617.0
|
)
|
|
$
|
273.4
|
|
|
|
February 3, 2018
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidating
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
133.2
|
|
|
$
|
700.1
|
|
|
$
|
264.5
|
|
|
$
|
—
|
|
|
$
|
1,097.8
|
|
Merchandise inventories, net
|
|
—
|
|
|
3,120.4
|
|
|
48.9
|
|
|
—
|
|
|
3,169.3
|
|
|||||
Current deferred tax assets, net
|
|
—
|
|
|
(7.9
|
)
|
|
7.9
|
|
|
—
|
|
|
—
|
|
|||||
Due from intercompany, net
|
|
102.1
|
|
|
635.5
|
|
|
69.0
|
|
|
(806.6
|
)
|
|
—
|
|
|||||
Other current assets
|
|
0.2
|
|
|
271.9
|
|
|
37.1
|
|
|
—
|
|
|
309.2
|
|
|||||
Total current assets
|
|
235.5
|
|
|
4,720.0
|
|
|
427.4
|
|
|
(806.6
|
)
|
|
4,576.3
|
|
|||||
Property, plant and equipment, net
|
|
—
|
|
|
3,175.7
|
|
|
25.0
|
|
|
—
|
|
|
3,200.7
|
|
|||||
Assets available for sale
|
|
—
|
|
|
8.0
|
|
|
—
|
|
|
—
|
|
|
8.0
|
|
|||||
Goodwill
|
|
—
|
|
|
4,993.1
|
|
|
32.1
|
|
|
—
|
|
|
5,025.2
|
|
|||||
Favorable lease rights, net
|
|
—
|
|
|
375.3
|
|
|
—
|
|
|
—
|
|
|
375.3
|
|
|||||
Tradename intangible asset
|
|
—
|
|
|
3,100.0
|
|
|
—
|
|
|
—
|
|
|
3,100.0
|
|
|||||
Other intangible assets, net
|
|
—
|
|
|
4.8
|
|
|
—
|
|
|
—
|
|
|
4.8
|
|
|||||
Investment in subsidiaries
|
|
9,748.8
|
|
|
108.2
|
|
|
—
|
|
|
(9,857.0
|
)
|
|
—
|
|
|||||
Intercompany note receivable
|
|
1,801.4
|
|
|
—
|
|
|
188.8
|
|
|
(1,990.2
|
)
|
|
—
|
|
|||||
Due from intercompany, net
|
|
1,310.7
|
|
|
—
|
|
|
—
|
|
|
(1,310.7
|
)
|
|
—
|
|
|||||
Other assets
|
|
—
|
|
|
42.3
|
|
|
2.9
|
|
|
(2.7
|
)
|
|
42.5
|
|
|||||
Total assets
|
|
$
|
13,096.4
|
|
|
$
|
16,527.4
|
|
|
$
|
676.2
|
|
|
$
|
(13,967.2
|
)
|
|
$
|
16,332.8
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current portion of long-term debt
|
|
$
|
915.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
915.9
|
|
Accounts payable
|
|
—
|
|
|
1,162.0
|
|
|
11.9
|
|
|
0.9
|
|
|
1,174.8
|
|
|||||
Due to intercompany, net
|
|
524.0
|
|
|
216.5
|
|
|
66.1
|
|
|
(806.6
|
)
|
|
—
|
|
|||||
Income taxes payable
|
|
(27.2
|
)
|
|
50.7
|
|
|
8.0
|
|
|
—
|
|
|
31.5
|
|
|||||
Other current liabilities
|
|
43.9
|
|
|
398.2
|
|
|
294.8
|
|
|
—
|
|
|
736.9
|
|
|||||
Total current liabilities
|
|
1,456.6
|
|
|
1,827.4
|
|
|
380.8
|
|
|
(805.7
|
)
|
|
2,859.1
|
|
|||||
Long-term debt, net, excluding
current portion
|
|
4,455.4
|
|
|
306.7
|
|
|
—
|
|
|
—
|
|
|
4,762.1
|
|
|||||
Unfavorable lease rights, net
|
|
—
|
|
|
100.0
|
|
|
—
|
|
|
—
|
|
|
100.0
|
|
|||||
Deferred tax liabilities, net
|
|
1.9
|
|
|
983.3
|
|
|
—
|
|
|
—
|
|
|
985.2
|
|
|||||
Income taxes payable, long-term
|
|
—
|
|
|
43.8
|
|
|
—
|
|
|
—
|
|
|
43.8
|
|
|||||
Due to intercompany, net
|
|
—
|
|
|
1,310.7
|
|
|
—
|
|
|
(1,310.7
|
)
|
|
—
|
|
|||||
Intercompany note payable
|
|
—
|
|
|
1,990.2
|
|
|
—
|
|
|
(1,990.2
|
)
|
|
—
|
|
|||||
Other liabilities
|
|
0.2
|
|
|
305.1
|
|
|
98.6
|
|
|
(3.6
|
)
|
|
400.3
|
|
|||||
Total liabilities
|
|
5,914.1
|
|
|
6,867.2
|
|
|
479.4
|
|
|
(4,110.2
|
)
|
|
9,150.5
|
|
|||||
Shareholders' equity
|
|
7,182.3
|
|
|
9,660.2
|
|
|
196.8
|
|
|
(9,857.0
|
)
|
|
7,182.3
|
|
|||||
Total liabilities and equity
|
|
$
|
13,096.4
|
|
|
$
|
16,527.4
|
|
|
$
|
676.2
|
|
|
$
|
(13,967.2
|
)
|
|
$
|
16,332.8
|
|
|
|
January 28, 2017
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidating
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
562.4
|
|
|
$
|
139.2
|
|
|
$
|
164.8
|
|
|
$
|
—
|
|
|
$
|
866.4
|
|
Short-term investments
|
|
—
|
|
|
—
|
|
|
4.0
|
|
|
—
|
|
|
4.0
|
|
|||||
Merchandise inventories, net
|
|
—
|
|
|
2,826.3
|
|
|
41.2
|
|
|
(1.7
|
)
|
|
2,865.8
|
|
|||||
Current deferred tax assets, net
|
|
—
|
|
|
(9.3
|
)
|
|
9.3
|
|
|
—
|
|
|
—
|
|
|||||
Due from intercompany, net
|
|
58.7
|
|
|
1,041.5
|
|
|
42.8
|
|
|
(1,143.0
|
)
|
|
—
|
|
|||||
Other current assets
|
|
0.5
|
|
|
198.7
|
|
|
2.3
|
|
|
0.3
|
|
|
201.8
|
|
|||||
Total current assets
|
|
621.6
|
|
|
4,196.4
|
|
|
264.4
|
|
|
(1,144.4
|
)
|
|
3,938.0
|
|
|||||
Property, plant and equipment, net
|
|
—
|
|
|
3,085.3
|
|
|
30.5
|
|
|
—
|
|
|
3,115.8
|
|
|||||
Assets available for sale
|
|
—
|
|
|
9.0
|
|
|
—
|
|
|
—
|
|
|
9.0
|
|
|||||
Goodwill
|
|
—
|
|
|
4,993.1
|
|
|
30.4
|
|
|
—
|
|
|
5,023.5
|
|
|||||
Favorable lease rights, net
|
|
—
|
|
|
468.6
|
|
|
—
|
|
|
—
|
|
|
468.6
|
|
|||||
Tradename intangible asset
|
|
—
|
|
|
3,100.0
|
|
|
—
|
|
|
—
|
|
|
3,100.0
|
|
|||||
Other intangible assets, net
|
|
—
|
|
|
5.1
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
|||||
Investment in subsidiaries
|
|
8,640.1
|
|
|
106.6
|
|
|
—
|
|
|
(8,746.7
|
)
|
|
—
|
|
|||||
Intercompany note receivable
|
|
1,926.4
|
|
|
—
|
|
|
188.8
|
|
|
(2,115.2
|
)
|
|
—
|
|
|||||
Due from intercompany, net
|
|
1,243.8
|
|
|
—
|
|
|
—
|
|
|
(1,243.8
|
)
|
|
—
|
|
|||||
Other assets
|
|
—
|
|
|
41.3
|
|
|
3.3
|
|
|
(3.0
|
)
|
|
41.6
|
|
|||||
Total assets
|
|
$
|
12,431.9
|
|
|
$
|
16,005.4
|
|
|
$
|
517.4
|
|
|
$
|
(13,253.1
|
)
|
|
$
|
15,701.6
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current portion of long-term debt
|
|
$
|
152.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
152.1
|
|
Accounts payable
|
|
—
|
|
|
1,105.9
|
|
|
14.7
|
|
|
(1.0
|
)
|
|
1,119.6
|
|
|||||
Due to intercompany, net
|
|
969.6
|
|
|
121.5
|
|
|
51.9
|
|
|
(1,143.0
|
)
|
|
—
|
|
|||||
Other current liabilities
|
|
66.4
|
|
|
470.5
|
|
|
207.3
|
|
|
—
|
|
|
744.2
|
|
|||||
Income taxes payable
|
|
(1.9
|
)
|
|
91.0
|
|
|
0.9
|
|
|
—
|
|
|
90.0
|
|
|||||
Total current liabilities
|
|
1,186.2
|
|
|
1,788.9
|
|
|
274.8
|
|
|
(1,144.0
|
)
|
|
2,105.9
|
|
|||||
Long-term debt, net, excluding
current portion
|
|
5,853.9
|
|
|
315.8
|
|
|
—
|
|
|
—
|
|
|
6,169.7
|
|
|||||
Unfavorable lease rights, net
|
|
—
|
|
|
124.0
|
|
|
—
|
|
|
—
|
|
|
124.0
|
|
|||||
Deferred tax liabilities, net
|
|
2.0
|
|
|
1,456.9
|
|
|
—
|
|
|
—
|
|
|
1,458.9
|
|
|||||
Income taxes payable, long-term
|
|
—
|
|
|
71.2
|
|
|
—
|
|
|
—
|
|
|
71.2
|
|
|||||
Due to intercompany, net
|
|
—
|
|
|
1,243.8
|
|
|
—
|
|
|
(1,243.8
|
)
|
|
—
|
|
|||||
Intercompany note payable
|
|
—
|
|
|
2,115.2
|
|
|
—
|
|
|
(2,115.2
|
)
|
|
—
|
|
|||||
Other liabilities
|
|
—
|
|
|
377.5
|
|
|
8.1
|
|
|
(3.2
|
)
|
|
382.4
|
|
|||||
Total liabilities
|
|
7,042.1
|
|
|
7,493.3
|
|
|
282.9
|
|
|
(4,506.2
|
)
|
|
10,312.1
|
|
|||||
Shareholders' equity
|
|
5,389.8
|
|
|
8,512.1
|
|
|
234.5
|
|
|
(8,746.9
|
)
|
|
5,389.5
|
|
|||||
Total liabilities and equity
|
|
$
|
12,431.9
|
|
|
$
|
16,005.4
|
|
|
$
|
517.4
|
|
|
$
|
(13,253.1
|
)
|
|
$
|
15,701.6
|
|
|
|
Year Ended February 3, 2018
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidating
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
Net cash provided by operating activities
|
|
$
|
222.3
|
|
|
$
|
1,908.5
|
|
|
$
|
153.3
|
|
|
$
|
(773.9
|
)
|
|
$
|
1,510.2
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
|
—
|
|
|
(631.0
|
)
|
|
(1.2
|
)
|
|
—
|
|
|
(632.2
|
)
|
|||||
Proceeds from sale of restricted and
unrestricted investments
|
|
—
|
|
|
—
|
|
|
4.0
|
|
|
—
|
|
|
4.0
|
|
|||||
Other
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|||||
Net cash provided by (used in)
investing activities
|
|
—
|
|
|
(630.7
|
)
|
|
2.8
|
|
|
—
|
|
|
(627.9
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Principal payments for long-term debt
|
|
(659.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(659.1
|
)
|
|||||
Dividends paid
|
|
—
|
|
|
(716.9
|
)
|
|
(57.0
|
)
|
|
773.9
|
|
|
—
|
|
|||||
Proceeds from stock issued pursuant to
stock-based compensation plans
|
|
35.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35.0
|
|
|||||
Cash paid for taxes on exercises/vesting of
stock-based compensation
|
|
(27.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27.4
|
)
|
|||||
Net cash used in financing activities
|
|
(651.5
|
)
|
|
(716.9
|
)
|
|
(57.0
|
)
|
|
773.9
|
|
|
(651.5
|
)
|
|||||
Effect of exchange rate changes on cash and
cash equivalents
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
0.6
|
|
|||||
Net (decrease) increase in cash and cash
equivalents
|
|
(429.2
|
)
|
|
560.9
|
|
|
99.7
|
|
|
—
|
|
|
231.4
|
|
|||||
Cash and cash equivalents at beginning of
period
|
|
562.4
|
|
|
139.2
|
|
|
164.8
|
|
|
—
|
|
|
866.4
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
133.2
|
|
|
$
|
700.1
|
|
|
$
|
264.5
|
|
|
$
|
—
|
|
|
$
|
1,097.8
|
|
|
|
Year Ended January 28, 2017
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidating
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
Net cash provided by operating activities
|
|
$
|
2,022.9
|
|
|
$
|
1,121.1
|
|
|
$
|
71.5
|
|
|
$
|
(1,542.2
|
)
|
|
$
|
1,673.3
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
|
—
|
|
|
(563.4
|
)
|
|
(1.3
|
)
|
|
—
|
|
|
(564.7
|
)
|
|||||
Purchase of restricted investments
|
|
—
|
|
|
(36.1
|
)
|
|
—
|
|
|
—
|
|
|
(36.1
|
)
|
|||||
Proceeds from sale of restricted
investments
|
|
—
|
|
|
118.1
|
|
|
—
|
|
|
—
|
|
|
118.1
|
|
|||||
Other
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|||||
Net cash used in investing activities
|
|
—
|
|
|
(482.3
|
)
|
|
(1.3
|
)
|
|
—
|
|
|
(483.6
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Principal payments for long-term debt
|
|
(4,036.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,036.2
|
)
|
|||||
Proceeds from long-term debt, net of
discount
|
|
2,962.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,962.5
|
|
|||||
Repayments of revolving credit facility
|
|
(140.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(140.0
|
)
|
|||||
Proceeds from revolving credit facility
|
|
140.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
140.0
|
|
|||||
Net intercompany note activity
|
|
(400.0
|
)
|
|
400.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Dividends paid
|
|
—
|
|
|
(1,536.5
|
)
|
|
(23.0
|
)
|
|
1,559.5
|
|
|
—
|
|
|||||
Proceeds from stock issued pursuant to
stock-based compensation plans
|
|
41.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41.5
|
|
|||||
Cash paid for taxes on exercises/vesting of
stock-based compensation
|
|
(22.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22.2
|
)
|
|||||
Other
|
|
(6.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.1
|
)
|
|||||
Net cash used in financing activities
|
|
(1,460.5
|
)
|
|
(1,136.5
|
)
|
|
(23.0
|
)
|
|
1,559.5
|
|
|
(1,060.5
|
)
|
|||||
Effect of exchange rate changes on cash and
cash equivalents
|
|
—
|
|
|
—
|
|
|
1.1
|
|
|
—
|
|
|
1.1
|
|
|||||
Net (decrease) increase in cash and cash
equivalents
|
|
562.4
|
|
|
(497.7
|
)
|
|
48.3
|
|
|
17.3
|
|
|
130.3
|
|
|||||
Cash and cash equivalents at beginning of
period
|
|
—
|
|
|
636.9
|
|
|
116.5
|
|
|
(17.3
|
)
|
|
736.1
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
562.4
|
|
|
$
|
139.2
|
|
|
$
|
164.8
|
|
|
$
|
—
|
|
|
$
|
866.4
|
|
|
|
Year Ended January 30, 2016
|
||||||||||||||||||
|
|
|
|
Guarantor
|
|
Non-Guarantor
|
|
Consolidating
|
|
Consolidated
|
||||||||||
(in millions)
|
|
Parent
|
|
Subsidiaries
|
|
Subsidiaries
|
|
Adjustments
|
|
Company
|
||||||||||
Net cash provided by (used in) operating
activities
|
|
$
|
765.1
|
|
|
$
|
720.8
|
|
|
$
|
(19.4
|
)
|
|
$
|
(664.0
|
)
|
|
$
|
802.5
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures
|
|
—
|
|
|
(475.7
|
)
|
|
(4.8
|
)
|
|
—
|
|
|
(480.5
|
)
|
|||||
Acquisition of Family Dollar, net of
common stock issued, equity
compensation and cash acquired
|
|
(6,833.0
|
)
|
|
207.3
|
|
|
98.0
|
|
|
—
|
|
|
(6,527.7
|
)
|
|||||
Other
|
|
—
|
|
|
(7.5
|
)
|
|
37.3
|
|
|
—
|
|
|
29.8
|
|
|||||
Net cash provided by (used in)
investing activities
|
|
(6,833.0
|
)
|
|
(275.9
|
)
|
|
130.5
|
|
|
—
|
|
|
(6,978.4
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Principal payments for long-term debt
|
|
(4,991.5
|
)
|
|
(935.2
|
)
|
|
—
|
|
|
—
|
|
|
(5,926.7
|
)
|
|||||
Proceeds from long-term debt, net of
discount
|
|
12,130.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,130.2
|
|
|||||
Net intercompany note activity
|
|
(1,109.6
|
)
|
|
1,109.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Dividends paid
|
|
—
|
|
|
(646.7
|
)
|
|
—
|
|
|
646.7
|
|
|
—
|
|
|||||
Debt-issuance costs
|
|
(159.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(159.8
|
)
|
|||||
Cash paid for taxes on exercises/vesting of
stock-based compensation
|
|
(21.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21.6
|
)
|
|||||
Other
|
|
26.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26.7
|
|
|||||
Net cash provided by (used in)
financing activities
|
|
5,874.4
|
|
|
(472.3
|
)
|
|
—
|
|
|
646.7
|
|
|
6,048.8
|
|
|||||
Effect of exchange rate changes on cash and
cash equivalents
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|
(0.9
|
)
|
|||||
Net (decrease) increase in cash and cash
equivalents
|
|
(193.5
|
)
|
|
(27.4
|
)
|
|
110.2
|
|
|
(17.3
|
)
|
|
(128.0
|
)
|
|||||
Cash and cash equivalents at beginning of
period
|
|
193.5
|
|
|
664.3
|
|
|
6.3
|
|
|
—
|
|
|
864.1
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
—
|
|
|
$
|
636.9
|
|
|
$
|
116.5
|
|
|
$
|
(17.3
|
)
|
|
$
|
736.1
|
|
(dollars in millions, except diluted net income per share data)
|
|
First
Quarter (1)
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Fiscal 2017:
|
|
|
|
|
|
|
|
|
||||||||
Net sales
|
|
$
|
5,287.1
|
|
|
$
|
5,281.2
|
|
|
$
|
5,316.6
|
|
|
$
|
6,360.6
|
|
Gross profit
|
|
$
|
1,627.1
|
|
|
$
|
1,627.8
|
|
|
$
|
1,666.0
|
|
|
$
|
2,101.0
|
|
Operating income (2)
|
|
$
|
388.8
|
|
|
$
|
419.5
|
|
|
$
|
425.2
|
|
|
$
|
765.6
|
|
Net income (3)
|
|
$
|
200.5
|
|
|
$
|
233.8
|
|
|
$
|
239.9
|
|
|
$
|
1,040.1
|
|
Diluted net income per share (3)
|
|
$
|
0.85
|
|
|
$
|
0.98
|
|
|
$
|
1.01
|
|
|
$
|
4.37
|
|
Stores open at end of quarter
|
|
14,482
|
|
|
14,581
|
|
|
14,744
|
|
|
14,835
|
|
||||
Comparable store net sales change (4)
|
|
0.5
|
%
|
|
2.4
|
%
|
|
3.3
|
%
|
|
2.5
|
%
|
||||
Fiscal 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales
|
|
$
|
5,085.8
|
|
|
$
|
4,996.3
|
|
|
$
|
5,001.6
|
|
|
$
|
5,635.3
|
|
Gross profit
|
|
$
|
1,554.6
|
|
|
$
|
1,512.4
|
|
|
$
|
1,520.5
|
|
|
$
|
1,807.0
|
|
Operating income
|
|
$
|
418.7
|
|
|
$
|
357.2
|
|
|
$
|
342.4
|
|
|
$
|
586.5
|
|
Net income
|
|
$
|
232.7
|
|
|
$
|
170.2
|
|
|
$
|
171.6
|
|
|
$
|
321.8
|
|
Diluted net income per share
|
|
$
|
0.98
|
|
|
$
|
0.72
|
|
|
$
|
0.72
|
|
|
$
|
1.36
|
|
Stores open at end of quarter
|
|
13,997
|
|
|
14,129
|
|
|
14,284
|
|
|
14,334
|
|
||||
Comparable store net sales change (4)
|
|
2.2
|
%
|
|
1.1
|
%
|
|
1.8
|
%
|
|
1.3
|
%
|
1.
|
Documents filed as part of this report
:
|
1.
|
Financial Statements. Reference is made to the Index to the Consolidated Financial Statements set forth under Part II, Item 8, on page 43 of this Form 10-K.
|
2.
|
Financial Statement Schedules. All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions, are not applicable, or the information is included in the Consolidated Financial Statements, and therefore have been omitted.
|
3.
|
Exhibits. The following exhibits, are filed as part of, or incorporated by reference into, this report.
|
|
|
|
|
Incorporated by Reference
|
|
|
||||
Exhibit
|
|
Exhibit Description
|
|
Form
|
|
Exhibit
|
|
Filing Date
|
|
Filed Herewith
|
2.1
|
|
|
8-K
|
|
2.1
|
|
7/29/2014
|
|
|
|
2.2
|
|
|
8-K
|
|
2.1
|
|
9/5/2014
|
|
|
|
3.1
|
|
|
8-K
|
|
3.1
|
|
6/21/2013
|
|
|
|
3.2
|
|
|
8-K
|
|
3.1
|
|
3/16/2018
|
|
|
|
4.1
|
|
|
8-K
|
|
4.1
|
|
3/13/2008
|
|
|
|
4.2.1
|
|
|
8-K
|
|
4.1
|
|
2/23/2015
|
|
|
|
4.2.2
|
|
|
8-K
|
|
4.1
|
|
7/8/2015
|
|
|
|
4.3.1
|
|
|
8-K
|
|
4.2
|
|
2/23/2015
|
|
|
|
4.3.2
|
|
|
8-K
|
|
4.2
|
|
7/8/2015
|
|
|
|
4.4.1
|
|
|
8-K
|
|
4.3
|
|
2/23/2015
|
|
|
|
4.4.2
|
|
|
8-K
|
|
4.3
|
|
7/8/2015
|
|
|
|
4.5.1
|
|
|
8-K
|
|
4.4
|
|
2/23/2015
|
|
|
|
4.5.2
|
|
|
8-K
|
|
4.4
|
|
7/8/2015
|
|
|
|
10.1.1
|
*
|
|
DEF 14A
|
|
C
|
|
4/30/2003
|
|
|
|
10.1.2
|
*
|
|
8-K
|
|
10.7
|
|
3/3/2008
|
|
|
|
10.1.3
|
*
|
|
10-K
|
|
10.1
|
|
4/1/2008
|
|
|
|
10.2
|
*
|
|
8-K
|
|
10.1
|
|
2/3/2005
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
||||
Exhibit
|
|
Exhibit Description
|
|
Form
|
|
Exhibit
|
|
Filing Date
|
|
Filed Herewith
|
10.3
|
*
|
|
8-K
|
|
10.1
|
|
3/20/2007
|
|
|
|
10.4
|
*
|
|
10-K
|
|
10.6
|
|
4/4/2007
|
|
|
|
10.5.1
|
*
|
|
10-Q
|
|
10.3
|
|
9/12/2007
|
|
|
|
10.5.2
|
*
|
|
10-K
|
|
10.14.2
|
|
3/14/2014
|
|
|
|
10.6
|
*
|
|
8-K
|
|
10.5
|
|
1/23/2008
|
|
|
|
10.7
|
*
|
|
8-K
|
|
N/A
|
|
1/23/2008
|
|
|
|
10.8
|
*
|
|
8-K
|
|
10.5
|
|
3/3/2008
|
|
|
|
10.9
|
|
|
10-Q
|
|
10.2
|
|
6/12/2008
|
|
|
|
10.10
|
|
|
10-Q
|
|
10.3
|
|
6/12/2008
|
|
|
|
10.11.1
|
*
|
|
8-K
|
|
10.1
|
|
12/5/2008
|
|
|
|
10.11.2
|
*
|
|
8-K
|
|
10.1
|
|
10/11/2011
|
|
|
|
10.12
|
*
|
|
10-Q
|
|
10.1
|
|
5/19/2011
|
|
|
|
10.13.1
|
*
|
|
8-K
|
|
10.1
|
|
6/22/2011
|
|
|
|
10.13.2
|
*
|
|
10-Q
|
|
10.1
|
|
9/2/2016
|
|
|
|
10.14
|
*
|
|
8-K
|
|
10.2
|
|
6/22/2011
|
|
|
|
10.15
|
*
|
|
8-K
|
|
10.3
|
|
6/22/2011
|
|
|
|
10.16
|
*
|
|
8-K
|
|
10.4
|
|
6/22/2011
|
|
|
|
10.17
|
*
|
|
8-K
|
|
10.1
|
|
3/21/2012
|
|
|
|
10.18
|
*
|
|
8-K
|
|
10.2
|
|
3/21/2012
|
|
|
|
10.19
|
*
|
|
10-Q
|
|
10.2
|
|
8/16/2012
|
|
|
|
10.20
|
*
|
|
10-Q
|
|
10.3
|
|
8/16/2012
|
|
|
|
10.21
|
*
|
|
10-Q
|
|
10.1
|
|
8/22/2013
|
|
|
|
10.22
|
*
|
|
10-Q
|
|
10.2
|
|
8/22/2013
|
|
|
|
10.23
|
*
|
|
10-K
|
|
10.51
|
|
3/14/2014
|
|
|
|
10.24.1
|
|
|
8-K
|
|
10.1
|
|
3/9/2015
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
||||
Exhibit
|
|
Exhibit Description
|
|
Form
|
|
Exhibit
|
|
Filing Date
|
|
Filed Herewith
|
10.24.2
|
|
|
8-K
|
|
10.1
|
|
6/12/2015
|
|
|
|
10.24.3
|
|
|
8-K
|
|
10.1
|
|
8/31/2016
|
|
|
|
10.24.4
|
|
|
8-K
|
|
10.1
|
|
9/26/2016
|
|
|
|
10.25.1
|
*
|
|
8-K
|
|
10.1
|
|
7/8/2015
|
|
|
|
10.25.2
|
*
|
|
10-Q
|
|
10.4
|
|
6/9/2016
|
|
|
|
10.26
|
*
|
|
8-K
|
|
10.2
|
|
7/8/2015
|
|
|
|
10.27
|
*
|
|
S-8
|
|
4.0
|
|
10/28/2015
|
|
|
|
10.28
|
*
|
|
8-K
|
|
10.1
|
|
10/15/2012
|
|
|
|
10.29
|
*
|
|
10-K
|
|
10.36
|
|
10/19/2012
|
|
|
|
10.30
|
*
|
|
8-K
|
|
10.1
|
|
3/23/2016
|
|
|
|
10.31
|
*
|
|
10-Q
|
|
10.3
|
|
6/9/2016
|
|
|
|
10.32
|
*
|
|
10-K
|
|
10.54
|
|
3/28/2017
|
|
|
|
10.33
|
*
|
|
10-K
|
|
10.55
|
|
3/28/2017
|
|
|
|
10.34
|
*
|
|
10-Q
|
|
10.1
|
|
8/24/2017
|
|
|
|
10.35
|
*
|
|
|
|
|
|
|
|
X
|
|
21.1
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X
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23.1
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X
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31.1
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X
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31.2
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X
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32.1
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X
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32.2
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X
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DOLLAR TREE, INC.
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DATE:
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March 16, 2018
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By:
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/s/ Gary Philbin
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Gary Philbin
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President and Chief Executive Officer
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Signature
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Title
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Date
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/s/ Gary Philbin
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Gary Philbin
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Director, President and Chief Executive Officer
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March 16, 2018
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(principal executive officer)
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/s/ Bob Sasser
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Bob Sasser
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Executive Chairman; Director
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March 16, 2018
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/s/ Thomas A. Saunders III
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Thomas A. Saunders III
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Lead Independent Director
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March 16, 2018
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/s/ Arnold S. Barron
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Arnold S. Barron
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Director
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March 16, 2018
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/s/ Gregory M. Bridgeford
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Gregory M. Bridgeford
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Director
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March 16, 2018
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/s/ Mary Anne Citrino
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Mary Anne Citrino
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Director
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March 16, 2018
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/s/ H. Ray Compton
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H. Ray Compton
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Director
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March 16, 2018
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/s/ Conrad M. Hall
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Conrad M. Hall
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Director
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March 16, 2018
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/s/ Lemuel E. Lewis
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Lemuel E. Lewis
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Director
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March 16, 2018
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/s/ Kathleen E. Mallas
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Kathleen E. Mallas
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Senior Vice President - Principal Accounting Officer
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March 16, 2018
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(principal accounting officer)
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/s/ Jeffrey Naylor
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Jeffrey Naylor
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Director
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March 16, 2018
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/s/ Stephanie Stahl
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Stephanie Stahl
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Director
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March 16, 2018
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/s/ Kevin S. Wampler
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Kevin S. Wampler
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Chief Financial Officer
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March 16, 2018
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(principal financial officer)
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/s/ Thomas E. Whiddon
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Thomas E. Whiddon
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Director
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March 16, 2018
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/s/ Dr. Carl P. Zeithaml
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Dr. Carl P. Zeithaml
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Director
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March 16, 2018
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1.
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PLAN ADMINISTRATION AND ELIGIBILITY.
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2.
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STOCK SUBJECT TO THE PLAN.
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3.
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DEFERRED COMPENSATION.
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4.
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STOCK OPTIONS.
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5.
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GENERAL PROVISIONS.
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ Gary Philbin
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Gary Philbin
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President and Chief Executive Officer
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ Kevin S. Wampler
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Kevin S. Wampler
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Chief Financial Officer
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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March 16, 2018
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/s/ Gary Philbin
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Date
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Gary Philbin
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President and Chief Executive Officer
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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March 16, 2018
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/s/ Kevin S. Wampler
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Date
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Kevin S. Wampler
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Chief Financial Officer
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