☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Virginia
|
|
26-2018846
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
500 Volvo Parkway
|
|
|
|
Chesapeake,
|
Virginia
|
|
23320
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
Trading symbol(s)
|
Name of each exchange on which registered
|
Common Stock, par value $.01 per share
|
DLTR
|
NASDAQ Global Select Market
|
Yes
|
☒
|
No
|
☐
|
Yes
|
☒
|
No
|
☐
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
|
|
Emerging growth company
|
☐
|
☐
|
Yes
|
☐
|
No
|
☒
|
|
|
Page
|
|
PART I - FINANCIAL INFORMATION
|
|
|
|
|
Item 1.
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
|
PART II - OTHER INFORMATION
|
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
Item 5.
|
||
Item 6.
|
||
|
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
||||||||||||
|
|
August 3,
|
|
August 4,
|
|
August 3,
|
|
August 4,
|
||||||||
(in millions, except per share data)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net sales
|
|
$
|
5,740.6
|
|
|
$
|
5,525.6
|
|
|
$
|
11,549.3
|
|
|
$
|
11,079.3
|
|
Cost of sales
|
|
4,092.1
|
|
|
3,861.7
|
|
|
8,173.6
|
|
|
7,715.8
|
|
||||
Gross profit
|
|
1,648.5
|
|
|
1,663.9
|
|
|
3,375.7
|
|
|
3,363.5
|
|
||||
Selling, general and administrative expenses
|
|
1,379.6
|
|
|
1,281.4
|
|
|
2,721.3
|
|
|
2,543.4
|
|
||||
Operating income
|
|
268.9
|
|
|
382.5
|
|
|
654.4
|
|
|
820.1
|
|
||||
Interest expense, net
|
|
40.1
|
|
|
46.1
|
|
|
81.5
|
|
|
276.1
|
|
||||
Other expense (income), net
|
|
0.4
|
|
|
(1.3
|
)
|
|
0.6
|
|
|
(1.1
|
)
|
||||
Income before income taxes
|
|
228.4
|
|
|
337.7
|
|
|
572.3
|
|
|
545.1
|
|
||||
Provision for income taxes
|
|
48.1
|
|
|
63.8
|
|
|
124.1
|
|
|
110.7
|
|
||||
Net income
|
|
$
|
180.3
|
|
|
$
|
273.9
|
|
|
$
|
448.2
|
|
|
$
|
434.4
|
|
Basic net income per share
|
|
$
|
0.76
|
|
|
$
|
1.15
|
|
|
$
|
1.88
|
|
|
$
|
1.83
|
|
Diluted net income per share
|
|
$
|
0.76
|
|
|
$
|
1.15
|
|
|
$
|
1.88
|
|
|
$
|
1.82
|
|
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
||||||||||||
|
|
August 3,
|
|
August 4,
|
|
August 3,
|
|
August 4,
|
||||||||
(in millions)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
|
$
|
180.3
|
|
|
$
|
273.9
|
|
|
$
|
448.2
|
|
|
$
|
434.4
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
|
1.5
|
|
|
(1.3
|
)
|
|
(1.3
|
)
|
|
(5.2
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Total comprehensive income
|
|
$
|
181.8
|
|
|
$
|
272.6
|
|
|
$
|
446.9
|
|
|
$
|
429.2
|
|
(in millions)
|
|
August 3, 2019
|
|
February 2, 2019
|
|
August 4, 2018
|
||||||
ASSETS
|
|
|
|
|
|
|
||||||
Current assets:
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
|
$
|
623.4
|
|
|
$
|
422.1
|
|
|
$
|
647.3
|
|
Merchandise inventories
|
|
3,470.9
|
|
|
3,536.0
|
|
|
3,288.2
|
|
|||
Other current assets
|
|
246.5
|
|
|
335.2
|
|
|
337.3
|
|
|||
Total current assets
|
|
4,340.8
|
|
|
4,293.3
|
|
|
4,272.8
|
|
|||
Property, plant and equipment, net of accumulated depreciation
of $3,928.0, $3,690.6 and $3,448.2, respectively
|
|
3,666.2
|
|
|
3,445.3
|
|
|
3,316.1
|
|
|||
Restricted cash
|
|
24.9
|
|
|
24.6
|
|
|
—
|
|
|||
Operating lease right-of-use assets
|
|
6,014.3
|
|
|
—
|
|
|
—
|
|
|||
Goodwill
|
|
2,296.3
|
|
|
2,296.6
|
|
|
5,023.9
|
|
|||
Favorable lease rights, net of accumulated amortization of $287.8
and $270.8 at February 2, 2019 and August 4, 2018,
respectively
|
|
—
|
|
|
288.7
|
|
|
334.5
|
|
|||
Trade name intangible asset
|
|
3,100.0
|
|
|
3,100.0
|
|
|
3,100.0
|
|
|||
Other assets
|
|
51.3
|
|
|
52.7
|
|
|
56.3
|
|
|||
Total assets
|
|
$
|
19,493.8
|
|
|
$
|
13,501.2
|
|
|
$
|
16,103.6
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|||
Current portion of long-term debt
|
|
$
|
750.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current portion of operating lease liabilities
|
|
1,215.0
|
|
|
—
|
|
|
—
|
|
|||
Accounts payable
|
|
1,455.4
|
|
|
1,416.4
|
|
|
1,241.7
|
|
|||
Income taxes payable
|
|
—
|
|
|
60.0
|
|
|
14.1
|
|
|||
Other current liabilities
|
|
673.6
|
|
|
619.3
|
|
|
651.6
|
|
|||
Total current liabilities
|
|
4,094.0
|
|
|
2,095.7
|
|
|
1,907.4
|
|
|||
Long-term debt, net, excluding current portion
|
|
3,518.6
|
|
|
4,265.3
|
|
|
5,041.8
|
|
|||
Operating lease liabilities, long-term
|
|
4,767.4
|
|
|
—
|
|
|
—
|
|
|||
Unfavorable lease rights, net of accumulated amortization of
$76.9 and $71.7 at February 2, 2019 and August 4, 2018,
respectively
|
|
—
|
|
|
78.8
|
|
|
89.2
|
|
|||
Deferred income taxes, net
|
|
960.2
|
|
|
973.2
|
|
|
976.0
|
|
|||
Income taxes payable, long-term
|
|
30.1
|
|
|
35.4
|
|
|
30.1
|
|
|||
Other liabilities
|
|
257.8
|
|
|
409.9
|
|
|
411.6
|
|
|||
Total liabilities
|
|
13,628.1
|
|
|
7,858.3
|
|
|
8,456.1
|
|
|||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|||
Shareholders’ equity
|
|
5,865.7
|
|
|
5,642.9
|
|
|
7,647.5
|
|
|||
Total liabilities and shareholders’ equity
|
|
$
|
19,493.8
|
|
|
$
|
13,501.2
|
|
|
$
|
16,103.6
|
|
|
|
|
|
|
|
|
||||||
Common shares outstanding
|
|
236.8
|
|
|
238.1
|
|
|
237.9
|
|
|
|
13 Weeks Ended August 3, 2019
|
|||||||||||||||||||||
(in millions)
|
|
Common
Stock
Shares
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Share-
holders'
Equity
|
|||||||||||
Balance at May 4, 2019
|
|
237.6
|
|
|
$
|
2.4
|
|
|
$
|
2,515.9
|
|
|
$
|
(41.1
|
)
|
|
$
|
3,278.7
|
|
|
$
|
5,755.9
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
180.3
|
|
|
180.3
|
|
|||||
Total other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
|
—
|
|
|
1.5
|
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
—
|
|
|
—
|
|
|
2.1
|
|
|
—
|
|
|
—
|
|
|
2.1
|
|
|||||
Exercise of stock options
|
|
—
|
|
|
—
|
|
|
1.2
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
|||||
Stock-based compensation, net
|
|
—
|
|
|
—
|
|
|
13.1
|
|
|
—
|
|
|
—
|
|
|
13.1
|
|
|||||
Repurchase of stock
|
|
(0.8
|
)
|
|
—
|
|
|
(88.4
|
)
|
|
—
|
|
|
—
|
|
|
(88.4
|
)
|
|||||
Balance at August 3, 2019
|
|
236.8
|
|
|
$
|
2.4
|
|
|
$
|
2,443.9
|
|
|
$
|
(39.6
|
)
|
|
$
|
3,459.0
|
|
|
$
|
5,865.7
|
|
|
|
26 Weeks Ended August 3, 2019
|
|||||||||||||||||||||
(in millions)
|
|
Common
Stock
Shares
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Share-
holders'
Equity
|
|||||||||||
Balance at February 2, 2019
|
|
238.1
|
|
|
$
|
2.4
|
|
|
$
|
2,602.7
|
|
|
$
|
(38.3
|
)
|
|
$
|
3,076.1
|
|
|
$
|
5,642.9
|
|
Cumulative effect of adopted accounting
standards, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(65.3
|
)
|
|
(65.3
|
)
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
448.2
|
|
|
448.2
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
(1.3
|
)
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
5.2
|
|
|
—
|
|
|
—
|
|
|
5.2
|
|
|||||
Exercise of stock options
|
|
—
|
|
|
—
|
|
|
4.1
|
|
|
—
|
|
|
—
|
|
|
4.1
|
|
|||||
Stock-based compensation, net
|
|
0.4
|
|
|
—
|
|
|
20.3
|
|
|
—
|
|
|
—
|
|
|
20.3
|
|
|||||
Repurchase of stock
|
|
(1.8
|
)
|
|
—
|
|
|
(188.4
|
)
|
|
—
|
|
|
—
|
|
|
(188.4
|
)
|
|||||
Balance at August 3, 2019
|
|
236.8
|
|
|
$
|
2.4
|
|
|
$
|
2,443.9
|
|
|
$
|
(39.6
|
)
|
|
$
|
3,459.0
|
|
|
$
|
5,865.7
|
|
|
|
13 Weeks Ended August 4, 2018
|
|||||||||||||||||||||
(in millions)
|
|
Common
Stock
Shares
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Share-
holders'
Equity
|
|||||||||||
Balance at May 5, 2018
|
|
237.8
|
|
|
$
|
2.4
|
|
|
$
|
2,562.1
|
|
|
$
|
(36.2
|
)
|
|
$
|
4,827.4
|
|
|
$
|
7,355.7
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
273.9
|
|
|
273.9
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
(1.3
|
)
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
—
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
|
—
|
|
|
2.6
|
|
|||||
Exercise of stock options
|
|
0.1
|
|
|
—
|
|
|
3.0
|
|
|
—
|
|
|
—
|
|
|
3.0
|
|
|||||
Stock-based compensation, net
|
|
—
|
|
|
—
|
|
|
13.6
|
|
|
—
|
|
|
—
|
|
|
13.6
|
|
|||||
Balance at August 4, 2018
|
|
237.9
|
|
|
$
|
2.4
|
|
|
$
|
2,581.3
|
|
|
$
|
(37.5
|
)
|
|
$
|
5,101.3
|
|
|
$
|
7,647.5
|
|
|
|
26 Weeks Ended August 4, 2018
|
|||||||||||||||||||||
(in millions)
|
|
Common
Stock
Shares
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Share-
holders'
Equity
|
|||||||||||
Balance at February 3, 2018
|
|
237.3
|
|
|
$
|
2.4
|
|
|
$
|
2,545.3
|
|
|
$
|
(32.3
|
)
|
|
$
|
4,666.9
|
|
|
$
|
7,182.3
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
434.4
|
|
|
434.4
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.2
|
)
|
|
—
|
|
|
(5.2
|
)
|
|||||
Issuance of stock under Employee Stock
Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
5.9
|
|
|
—
|
|
|
—
|
|
|
5.9
|
|
|||||
Exercise of stock options
|
|
0.1
|
|
|
—
|
|
|
4.3
|
|
|
—
|
|
|
—
|
|
|
4.3
|
|
|||||
Stock-based compensation, net
|
|
0.4
|
|
|
—
|
|
|
25.8
|
|
|
—
|
|
|
—
|
|
|
25.8
|
|
|||||
Balance at August 4, 2018
|
|
237.9
|
|
|
$
|
2.4
|
|
|
$
|
2,581.3
|
|
|
$
|
(37.5
|
)
|
|
$
|
5,101.3
|
|
|
$
|
7,647.5
|
|
|
|
26 Weeks Ended
|
||||||
|
|
August 3,
|
|
August 4,
|
||||
(in millions)
|
|
2019
|
|
2018
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
448.2
|
|
|
$
|
434.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
306.3
|
|
|
304.0
|
|
||
Provision for deferred income taxes
|
|
9.0
|
|
|
(9.4
|
)
|
||
Amortization of debt discount and debt-issuance costs
|
|
3.3
|
|
|
51.7
|
|
||
Other non-cash adjustments to net income
|
|
61.4
|
|
|
49.1
|
|
||
Loss on debt extinguishment
|
|
—
|
|
|
114.7
|
|
||
Changes in operating assets and liabilities
|
|
15.8
|
|
|
(175.7
|
)
|
||
Net cash provided by operating activities
|
|
844.0
|
|
|
768.8
|
|
||
Cash flows from investing activities:
|
|
|
|
|
|
|
||
Capital expenditures
|
|
(502.5
|
)
|
|
(394.3
|
)
|
||
Proceeds from governmental grant
|
|
16.5
|
|
|
—
|
|
||
Payments for fixed asset disposition
|
|
(2.7
|
)
|
|
(0.4
|
)
|
||
Net cash used in investing activities
|
|
(488.7
|
)
|
|
(394.7
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
|
||
Proceeds from long-term debt, net of discount
|
|
—
|
|
|
4,775.8
|
|
||
Principal payments for long-term debt
|
|
—
|
|
|
(5,432.7
|
)
|
||
Debt-issuance and debt extinguishment costs
|
|
—
|
|
|
(155.3
|
)
|
||
Proceeds from revolving credit facility
|
|
—
|
|
|
50.0
|
|
||
Repayments of revolving credit facility
|
|
—
|
|
|
(50.0
|
)
|
||
Proceeds from stock issued pursuant to stock-based compensation plans
|
|
9.1
|
|
|
10.2
|
|
||
Cash paid for taxes on exercises/vesting of stock-based compensation
|
|
(23.9
|
)
|
|
(21.7
|
)
|
||
Payments for repurchase of stock
|
|
(139.2
|
)
|
|
—
|
|
||
Net cash used in financing activities
|
|
(154.0
|
)
|
|
(823.7
|
)
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
|
0.3
|
|
|
(0.9
|
)
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
201.6
|
|
|
(450.5
|
)
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
|
446.7
|
|
|
1,097.8
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
648.3
|
|
|
$
|
647.3
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
||
Cash paid for:
|
|
|
|
|
|
|
||
Interest, net of amounts capitalized
|
|
$
|
84.2
|
|
|
$
|
277.7
|
|
Income taxes
|
|
$
|
220.1
|
|
|
$
|
169.2
|
|
Non-cash transactions:
|
|
|
|
|
||||
Accrued capital expenditures
|
|
$
|
55.7
|
|
|
$
|
46.4
|
|
(in millions)
|
|
August 3,
2019 |
|
February 2,
2019 |
|
August 4,
2018 |
||||||
Level 1
|
|
|
|
|
|
|
||||||
Deferred compensation plan assets
|
|
$
|
21.8
|
|
|
$
|
21.8
|
|
|
$
|
22.5
|
|
|
|
August 3, 2019
|
|
February 2, 2019
|
|
August 4, 2018
|
||||||||||||||||||
(in millions)
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||||||
Level 1
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Senior Notes
|
|
$
|
4,460.8
|
|
|
$
|
4,277.5
|
|
|
$
|
4,198.6
|
|
|
$
|
4,275.5
|
|
|
$
|
4,288.7
|
|
|
$
|
4,273.4
|
|
Level 2
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Term Loan Facility
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
774.2
|
|
|
779.8
|
|
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
||||||||||||
|
|
August 3,
|
|
August 4,
|
|
August 3,
|
|
August 4,
|
||||||||
(in millions, except per share data)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Basic net income per share:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
180.3
|
|
|
$
|
273.9
|
|
|
$
|
448.2
|
|
|
$
|
434.4
|
|
Weighted average number of shares outstanding
|
|
237.6
|
|
|
237.9
|
|
|
237.8
|
|
|
237.7
|
|
||||
Basic net income per share
|
|
$
|
0.76
|
|
|
$
|
1.15
|
|
|
$
|
1.88
|
|
|
$
|
1.83
|
|
Diluted net income per share:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
180.3
|
|
|
$
|
273.9
|
|
|
$
|
448.2
|
|
|
$
|
434.4
|
|
Weighted average number of shares outstanding
|
|
237.6
|
|
|
237.9
|
|
|
237.8
|
|
|
237.7
|
|
||||
Dilutive effect of stock options and restricted stock (as
determined by applying the treasury stock method) |
|
0.7
|
|
|
0.7
|
|
|
0.9
|
|
|
0.8
|
|
||||
Weighted average number of shares and dilutive potential
shares outstanding |
|
238.3
|
|
|
238.6
|
|
|
238.7
|
|
|
238.5
|
|
||||
Diluted net income per share
|
|
$
|
0.76
|
|
|
$
|
1.15
|
|
|
$
|
1.88
|
|
|
$
|
1.82
|
|
|
|
Number of Shares
|
|
Weighted Average
Grant Date
Fair Value
|
|||
Nonvested at February 2, 2019
|
|
1,446,100
|
|
|
$
|
86.96
|
|
Granted
|
|
765,787
|
|
|
103.66
|
|
|
Vested
|
|
(640,768
|
)
|
|
84.70
|
|
|
Forfeited
|
|
(159,498
|
)
|
|
88.87
|
|
|
Nonvested at August 3, 2019
|
|
1,411,621
|
|
|
$
|
96.40
|
|
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
||||||||||||
|
|
August 3,
|
|
August 4,
|
|
August 3,
|
|
August 4,
|
||||||||
(in millions)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Condensed Consolidated Income Statement Data:
|
|
|
|
|
|
|
|
|
||||||||
Net sales:
|
|
|
|
|
|
|
|
|
||||||||
Dollar Tree
|
|
$
|
2,957.7
|
|
|
$
|
2,768.8
|
|
|
$
|
5,917.1
|
|
|
$
|
5,553.2
|
|
Family Dollar
|
|
2,782.9
|
|
|
2,756.8
|
|
|
5,632.2
|
|
|
5,526.1
|
|
||||
Consolidated Net sales
|
|
$
|
5,740.6
|
|
|
$
|
5,525.6
|
|
|
$
|
11,549.3
|
|
|
$
|
11,079.3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross profit:
|
|
|
|
|
|
|
|
|
||||||||
Dollar Tree
|
|
$
|
999.0
|
|
|
$
|
955.3
|
|
|
$
|
2,020.2
|
|
|
$
|
1,916.1
|
|
Family Dollar
|
|
649.5
|
|
|
708.6
|
|
|
1,355.5
|
|
|
1,447.4
|
|
||||
Consolidated Gross profit
|
|
$
|
1,648.5
|
|
|
$
|
1,663.9
|
|
|
$
|
3,375.7
|
|
|
$
|
3,363.5
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss):
|
|
|
|
|
|
|
|
|
||||||||
Dollar Tree
|
|
$
|
334.0
|
|
|
$
|
330.8
|
|
|
$
|
725.0
|
|
|
$
|
703.5
|
|
Family Dollar
|
|
15.4
|
|
|
113.6
|
|
|
105.7
|
|
|
257.5
|
|
||||
Corporate and support
|
|
(80.5
|
)
|
|
(61.9
|
)
|
|
(176.3
|
)
|
|
(140.9
|
)
|
||||
Consolidated Operating income
|
|
268.9
|
|
|
382.5
|
|
|
654.4
|
|
|
820.1
|
|
||||
Interest expense, net
|
|
40.1
|
|
|
46.1
|
|
|
81.5
|
|
|
276.1
|
|
||||
Other expense (income), net
|
|
0.4
|
|
|
(1.3
|
)
|
|
0.6
|
|
|
(1.1
|
)
|
||||
Income before income taxes
|
|
$
|
228.4
|
|
|
$
|
337.7
|
|
|
$
|
572.3
|
|
|
$
|
545.1
|
|
|
|
As of
|
||||||||||
|
|
August 3,
|
|
February 2,
|
|
August 4,
|
||||||
(in millions)
|
|
2019
|
|
2019
|
|
2018
|
||||||
Condensed Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
||||||
Goodwill:
|
|
|
|
|
|
|
||||||
Dollar Tree
|
|
$
|
412.3
|
|
|
$
|
376.5
|
|
|
$
|
356.5
|
|
Family Dollar
|
|
1,884.0
|
|
|
1,920.1
|
|
|
4,667.4
|
|
|||
Consolidated Goodwill
|
|
$
|
2,296.3
|
|
|
$
|
2,296.6
|
|
|
$
|
5,023.9
|
|
|
|
|
|
|
|
|
||||||
Total assets:
|
|
|
|
|
|
|
||||||
Dollar Tree
|
|
$
|
7,147.2
|
|
|
$
|
3,992.6
|
|
|
$
|
3,869.7
|
|
Family Dollar
|
|
11,982.2
|
|
|
9,144.7
|
|
|
11,875.2
|
|
|||
Corporate and support
|
|
364.4
|
|
|
363.9
|
|
|
358.7
|
|
|||
Consolidated Total assets
|
|
$
|
19,493.8
|
|
|
$
|
13,501.2
|
|
|
$
|
16,103.6
|
|
|
|
|
|
|
|
|
Weighted-average remaining lease term (years)
|
|
6.6
|
|
Weighted-average discount rate
|
|
4.4
|
%
|
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
||||
(in millions)
|
|
August 3, 2019
|
|
August 3, 2019
|
||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
|
||||
Operating cash flows from operating leases
|
|
$
|
364.4
|
|
|
$
|
731.6
|
|
Right-of-use assets obtained in exchange for new operating lease liabilities
|
|
213.9
|
|
|
429.3
|
|
|
|
(in millions)
|
||
2019
|
|
$
|
1,435.9
|
|
2020
|
|
1,176.7
|
|
|
2021
|
|
1,100.0
|
|
|
2022
|
|
899.6
|
|
|
2023
|
|
729.1
|
|
|
Thereafter
|
|
1,966.3
|
|
|
Total minimum lease payments
|
|
$
|
7,307.6
|
|
•
|
the potential effect of general business or economic conditions (including inflation) 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 (including the effects of potential increases in import freight costs due to low sulphur fuel requirements for ships which become effective in January 2020), fuel costs and wage and benefit costs, consumer spending levels, and population, employment and job growth and/or losses in our markets;
|
•
|
the actual and potential effect of Section 301 tariffs on Chinese goods imposed by the United States Trade Representative;
|
•
|
our growth plans, including our plans to add, renovate, re-banner, expand, relocate or close stores and any related costs or charges, our anticipated square footage increase, and our ability to renew leases at existing store locations;
|
•
|
the ability to retain key personnel and attract new personnel at Family Dollar and Dollar Tree;
|
•
|
our anticipated sales, comparable store net sales, net sales growth, gross profit margin, earnings and earnings growth, inventory levels and our ability to leverage selling, general and administrative and other fixed costs;
|
•
|
the outcome and costs of pending or potential litigation or governmental investigations;
|
•
|
the effect of changes in labor laws, and the effect of the Fair Labor Standards Act as it relates to the qualification of our managers for exempt status, minimum wage and health care law;
|
•
|
the average size of our stores to be added in 2019 and beyond;
|
•
|
the effect of our consumable merchandise initiatives, including the increase in the number of our stores with freezers and coolers, the increase in the number of freezer and cooler doors in H2 stores and the roll-outs of adult beverage and Snack Zone, on our results of operations;
|
•
|
the net sales per square foot, net sales and operating income of our stores;
|
•
|
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;
|
•
|
the effect of changes in tax laws and regulatory interpretations of such laws;
|
•
|
our seasonal sales patterns including those relating to the length of the holiday selling seasons;
|
•
|
the capabilities of our inventory supply chain technology and other systems;
|
•
|
the reliability of, and cost associated with, our sources of supply, particularly imported goods such as those sourced from China;
|
•
|
the capacity, performance and cost of our distribution centers, including future automation;
|
•
|
our cash needs, including our ability to fund our future capital expenditures and working capital requirements and our ability to service our debt obligations, including our expected annual interest expense;
|
•
|
our expectations regarding competition and growth in our retail sector;
|
•
|
our assessment of the materiality and impact on our business of recent accounting pronouncements adopted by the Financial Accounting Standards Board;
|
•
|
our assessment of the impact on the Company of certain actions by activist shareholders and the Company’s potential responses to these actions; and
|
•
|
management’s estimates associated with our critical accounting policies, including inventory valuation, self-insurance liabilities and valuations for impairment analyses.
|
•
|
Our profitability is vulnerable to cost increases.
|
•
|
Risks associated with our domestic and foreign suppliers, including, among others, increased taxes, duties, tariffs or other restrictions on trade (including Section 301 tariffs imposed by the United States Trade Representative on imported Chinese goods), including our ability to mitigate Section 301 tariffs, could adversely affect our financial performance.
|
•
|
We have encountered costs and delays in distributing merchandise, such as freight cost increases and we expect additional cost increases as a result of low sulphur fuel requirements for ships which become effective in January 2020, and we could encounter additional disruptions in our distribution network.
|
•
|
Integrating Family Dollar’s operations with ours may be more difficult, costly or time consuming than expected, including disruptions or the loss of key personnel.
|
•
|
Our business could be adversely affected if we fail to attract and retain qualified associates and key personnel.
|
•
|
We rely on computer and technology systems in our operations, and any material failure, inadequacy, interruption or security failure of those systems could harm our ability to effectively operate and grow our business and could adversely affect our financial results.
|
•
|
If we are unable to secure our customers’ credit card and confidential information, or other private data relating to our associates, suppliers or our business, we could be subject to negative publicity, costly government enforcement actions or private litigation and increased costs, which could damage our business reputation and adversely affect our results of operations or business.
|
•
|
Our growth is dependent on our ability to increase sales in existing stores and to expand our square footage profitably.
|
•
|
We could incur losses due to impairment of long-lived assets, goodwill and intangible assets.
|
•
|
Our profitability is affected by the mix of products we sell.
|
•
|
Litigation may adversely affect our business, financial condition and results of operations. For a discussion of current legal proceedings, see “Note 2 - Legal Proceedings,” included in “Part I. Financial Information, Item 1. Financial Statements” of this Form 10-Q.
|
•
|
Pressure from competitors may reduce our sales and profits.
|
•
|
A downturn or changes in economic conditions could impact our sales or profitability.
|
•
|
Changes in federal, state or local law, including regulations and interpretations or guidance thereunder, or our failure to adequately estimate the impact of such changes or comply with such laws, could increase our expenses, expose us to legal risks or otherwise adversely affect us.
|
•
|
The price of our common stock is subject to market and other conditions and may be volatile.
|
•
|
Our business or the value of our common stock could be negatively affected as a result of actions by activist shareholders or by organizations seeking to limit the growth of dollar stores or change the mix or price of products we sell.
|
•
|
Our substantial indebtedness could adversely affect our financial condition, limit our ability to obtain additional financing, restrict our operations and make us more vulnerable to economic downturns and competitive pressures.
|
•
|
The terms of the agreements governing our indebtedness may restrict our current and future operations, particularly our ability to respond to changes or to pursue our business strategies, and could adversely affect our capital resources, financial condition and liquidity.
|
•
|
Our variable-rate indebtedness subjects us to interest rate risk, which could cause our annual debt service obligations to increase significantly.
|
•
|
Certain provisions in our Articles of Incorporation and Bylaws could delay or discourage a change of control transaction that may be in a shareholder’s best interest.
|
|
26 Weeks Ended
|
||||||||||||||||
|
August 3, 2019
|
|
August 4, 2018
|
||||||||||||||
|
Dollar Tree
|
|
Family Dollar
|
|
Total
|
|
Dollar Tree
|
|
Family Dollar
|
|
Total
|
||||||
Store Count:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Beginning
|
7,001
|
|
|
8,236
|
|
|
15,237
|
|
|
6,650
|
|
|
8,185
|
|
|
14,835
|
|
New stores
|
172
|
|
|
69
|
|
|
241
|
|
|
150
|
|
|
126
|
|
|
276
|
|
Re-bannered stores
|
151
|
|
|
(184
|
)
|
|
(33
|
)
|
|
17
|
|
|
(24
|
)
|
|
(7
|
)
|
Closings
|
(18
|
)
|
|
(312
|
)
|
|
(330
|
)
|
|
(5
|
)
|
|
(26
|
)
|
|
(31
|
)
|
Ending
|
7,306
|
|
|
7,809
|
|
|
15,115
|
|
|
6,812
|
|
|
8,261
|
|
|
15,073
|
|
Relocations
|
23
|
|
|
7
|
|
|
30
|
|
|
34
|
|
|
5
|
|
|
39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling Square Feet (in millions):
|
|
|
|
|
|
|
|
|
|
|
|||||||
Beginning
|
60.3
|
|
|
59.8
|
|
|
120.1
|
|
|
57.3
|
|
|
59.3
|
|
|
116.6
|
|
New stores
|
1.5
|
|
|
0.5
|
|
|
2.0
|
|
|
1.2
|
|
|
0.9
|
|
|
2.1
|
|
Re-bannered stores
|
1.1
|
|
|
(1.3
|
)
|
|
(0.2
|
)
|
|
0.1
|
|
|
(0.2
|
)
|
|
(0.1
|
)
|
Closings
|
(0.1
|
)
|
|
(2.2
|
)
|
|
(2.3
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
(0.2
|
)
|
Relocations
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
Ending
|
62.9
|
|
|
56.8
|
|
|
119.7
|
|
|
58.7
|
|
|
59.8
|
|
|
118.5
|
|
•
|
A roll-out of a new model for both new and renovated Family Dollar stores internally known as H2. We tested the H2 model in 2018 on a limited basis with positive results. This H2 model has significantly improved merchandise offerings, including approximately 20 Dollar Tree $1.00 merchandise sections and establishing a minimum number of freezer and cooler doors, throughout the store. H2 has increased traffic and provided an average comparable store net sales lift in excess of 10% over control stores. H2 performs well in a variety of locations, and especially in locations where Family Dollar has been most challenged in the past. We started 2019 with approximately 200 H2 stores and as of August 3, 2019, we have approximately 1,000 H2 stores. Our plan is to renovate at least 1,150 stores to this model in 2019 and we expect an accelerated renovation schedule in future years.
|
•
|
We plan to close under-performing stores. The normal cadence of Family Dollar closings on an annual basis is approximately 75 stores. In 2019 we will accelerate the pace of closings to as many as 390 stores and have closed 312 stores as of August 3, 2019. We expect to incur approximately $24.5 million in store closure costs and through the second quarter of 2019, we have incurred $19.4 million. In addition to these costs, during the second quarter of 2019 we incurred approximately $15.0 million of other store closure costs, primarily due to loss on disposal of fixed assets.
|
•
|
We plan to re-banner approximately 200 Family Dollar stores to the Dollar Tree brand in 2019. As of August 3, 2019, we have re-bannered 151 stores to the Dollar Tree brand.
|
•
|
Additionally, we plan to install adult beverage product in approximately 1,000 stores and expand freezers and coolers in approximately 75 stores in 2019. As of August 3, 2019, we installed adult beverage product in approximately 250 stores and expanded freezers and coolers in approximately 70 stores.
|
•
|
The Office of the United States Trade Representative (USTR) previously imposed tariffs under Section 301 against Chinese goods described on Lists 1, 2, and 3 with an annual trade value of $250 billion. The tariff rate on $200 billion of those goods under List 3 increased to 25 percent on May 10, 2019. When the tariffs were implemented, approximately nine percent of our products, measured by sales volume, were on Lists 1, 2, and 3. To mitigate the potential adverse effect of the tariffs, we negotiated price concessions from vendors on certain products, canceled orders, changed product sizes and specifications, changed our product mix and changed vendors. As a result of our mitigation efforts, we believe that we have reduced most of the potential adverse effects of the tariffs under Lists 1, 2, and 3 on the Dollar Tree and Family Dollar segments through September 2019.
|
•
|
Earlier this year, the USTR began a process to impose a tariff on all of the $300 billion in Chinese goods which were not previously subject to a tariff under Section 301, referred to as List 4 goods. On August 13, 2019, the USTR published the final description of products on List 4 and divided the list into two parts. Tariffs at the rate of 10 percent on List 4A goods were originally scheduled to go into effect September 1, 2019. Tariffs at the rate of 10 percent on List 4B goods were originally scheduled to go into effect December 15, 2019. We anticipate that more of our products are on List 4 than Lists 1, 2, and 3 combined. However, we also believe that most of our List 4 products are contained on List 4B and not List 4A.
|
•
|
On August 23, 2019, the USTR announced that tariffs on List 1, 2, and 3 products would increase from 25% to 30% on October 1, 2019, tariffs on List 4A products would increase from 10% to 15% on September 1, 2019, and tariffs on List 4B products would increase from 10% to 15% on December 15, 2019. We estimate that without mitigation
|
•
|
We anticipate higher import freight costs beginning in the third quarter of 2019 based on our April rate negotiations and the commencement of low sulphur fuel requirements for ships in January 2020. We expect that this will result in higher costs in future periods as merchandise is sold.
|
•
|
Merchandise cost, including freight, increased approximately 60 basis points resulting from higher freight costs and higher sales of lower margin consumable merchandise at the Family Dollar segment.
|
•
|
Markdown expense increased approximately 45 basis points resulting from markdowns related to store closures and higher clearance sales in the Family Dollar segment.
|
•
|
Shrink costs increased approximately 25 basis points due to unfavorable inventory results in the Family Dollar segment in the current quarter.
|
•
|
Operating and corporate expenses increased approximately 65 basis points resulting from increased costs related to the consolidation of our store support centers, increased loss on the disposal of fixed assets due to store closure write-offs and increased store supplies expense to support the H2 initiative on the Family Dollar segment.
|
•
|
Payroll expenses increased approximately 25 basis points primarily due to average hourly rate increases and additional hours, including increased temporary help expenses, to support store-level initiatives. These increases were partially offset by decreased retirement plan contributions.
|
•
|
Merchandise cost, including freight, increased approximately 50 basis points resulting from higher freight costs and increased sales of lower margin consumable merchandise, primarily in the Family Dollar segment.
|
•
|
Markdown expense increased approximately 20 basis points resulting primarily from markdowns related to store closures and higher clearance sales in the Family Dollar segment.
|
•
|
Shrink costs increased approximately 20 basis points due to unfavorable inventory results, primarily in the Family Dollar segment, in the current year.
|
•
|
Occupancy costs increased approximately 10 basis points resulting from the accelerated amortization of the right-of-use assets for Family Dollar stores we closed during 2019.
|
•
|
Distribution costs increased approximately 10 basis points resulting primarily from higher distribution center payroll costs.
|
•
|
Operating and corporate expenses increased approximately 45 basis points resulting from increased costs related to the consolidation of our store support centers, increased loss on the disposal of fixed assets due to store closure write-offs and increased store supplies expense to support the H2 initiative on the Family Dollar segment.
|
•
|
Payroll expenses increased approximately 20 basis points primarily due to average hourly rate increases and additional hours, including increased temporary help expenses, to support store-level initiatives. These increases were partially offset by decreased retirement plan contributions.
|
•
|
Depreciation and amortization expense decreased approximately 10 basis points as a result of certain assets on the Family Dollar segment that were revalued upon the 2015 acquisition becoming fully depreciated.
|
•
|
Merchandise cost, including freight, increased approximately 55 basis points primarily due to higher freight costs and an increase in lower margin consumable sales in the quarter.
|
•
|
Distribution costs increased approximately 5 basis points resulting from higher distribution center payroll and depreciation costs.
|
•
|
Occupancy costs increased approximately 5 basis points resulting from loss of leverage from the lower comparable store net sales increase in the current year.
|
•
|
Shrink increased approximately 5 basis points resulting from unfavorable inventory results in the current quarter.
|
•
|
Merchandise cost, including freight, increased approximately 30 basis points primarily due to higher freight costs.
|
•
|
Distribution costs increased approximately 10 basis points primarily due to higher distribution center payroll costs.
|
•
|
Store occupancy costs decreased approximately 15 basis points primarily due to decreased electricity costs.
|
•
|
Payroll expenses increased approximately 10 basis points due to increased store hourly payroll costs resulting from average hourly rate increases and additional hours to support store-level initiatives, partially offset by lower retirement plan expense.
|
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
||||||||||||||||||||||||
|
|
August 3, 2019
|
|
August 4, 2018
|
|
August 3, 2019
|
|
August 4, 2018
|
||||||||||||||||||||
(in millions)
|
|
$
|
|
% of
Net Sales
|
|
$
|
|
% of
Net Sales
|
|
$
|
|
% of
Net Sales
|
|
$
|
|
% of
Net Sales
|
||||||||||||
Net sales
|
|
$
|
2,782.9
|
|
|
|
|
$
|
2,756.8
|
|
|
|
|
$
|
5,632.2
|
|
|
|
|
$
|
5,526.1
|
|
|
|
||||
Gross profit
|
|
649.5
|
|
|
23.3
|
%
|
|
708.6
|
|
|
25.7
|
%
|
|
1,355.5
|
|
|
24.1
|
%
|
|
1,447.4
|
|
|
26.2
|
%
|
||||
Operating income
|
|
15.4
|
|
|
0.6
|
%
|
|
113.6
|
|
|
4.1
|
%
|
|
105.7
|
|
|
1.9
|
%
|
|
257.5
|
|
|
4.7
|
%
|
•
|
Markdown expense increased approximately 100 basis points resulting from store closure markdowns and higher clearance sales.
|
•
|
Merchandise cost, including freight, increased approximately 95 basis points, primarily due to increased sales of higher cost consumable merchandise and higher freight costs.
|
•
|
Shrink costs increased approximately 45 basis points resulting from unfavorable physical inventory results in the current quarter and an increase in the shrink accrual rate.
|
•
|
Merchandise cost, including freight, increased approximately 90 basis points, primarily due to increased sales of lower margin consumable merchandise and higher freight costs.
|
•
|
Markdown expense increased approximately 50 basis points resulting from store closure markdowns and higher clearance sales.
|
•
|
Shrink costs increased approximately 45 basis points resulting from unfavorable physical inventory results in the current year and an increase in the shrink accrual rate.
|
•
|
Distribution costs increased approximately 15 basis points resulting primarily from higher merchandising and distribution payroll-related costs.
|
•
|
Occupancy costs increased approximately 10 basis points resulting from the accelerated amortization of the right-of-use assets for stores we closed during 2019.
|
•
|
Operating and corporate expenses increased approximately 95 basis points resulting primarily from increased loss on the disposal of fixed assets due to store closure write-offs and increased store supplies expense to support the H2 initiative.
|
•
|
Payroll expenses increased approximately 35 basis points primarily due to average hourly rate increases and additional hours, including increased temporary help expenses, to support store-level initiatives. These increases were partially offset by lower workers’ compensation expenses resulting from favorable development of prior years’ claims.
|
•
|
Depreciation and amortization expense decreased approximately 15 basis points as a result of certain assets that were revalued upon the 2015 acquisition becoming fully depreciated and/or amortized.
|
•
|
Operating and corporate expenses increased approximately 45 basis points resulting primarily from increased loss on the disposal of fixed assets due to store closure write-offs and increased store supplies expense to support the H2 initiative.
|
•
|
Payroll expenses increased approximately 30 basis points primarily due to average hourly rate increases and additional hours, including increased temporary help expenses, to support store-level initiatives.
|
•
|
Store operating costs increased approximately 10 basis points due primarily to higher repairs and maintenance costs in the current year.
|
•
|
Depreciation and amortization expense decreased approximately 20 basis points as a result of certain assets that were revalued upon the 2015 acquisition becoming fully depreciated and/or amortized.
|
|
|
26 Weeks Ended
|
||||||
|
|
August 3,
|
|
August 4,
|
||||
(in millions)
|
|
2019
|
|
2018
|
||||
Net cash provided by (used in):
|
|
|
|
|
||||
Operating activities
|
|
$
|
844.0
|
|
|
$
|
768.8
|
|
Investing activities
|
|
(488.7
|
)
|
|
(394.7
|
)
|
||
Financing activities
|
|
(154.0
|
)
|
|
(823.7
|
)
|
•
|
product safety matters, which may include product recalls in cooperation with the Consumer Products Safety Commission or other jurisdictions;
|
Fiscal Period
|
|
Total number of shares purchased
|
|
Average price paid per share
|
|
Total number of shares purchased as part of publicly announced plans or programs
|
|
Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions)
|
||||||
May 5 - June 1, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
900.0
|
|
June 2 - July 6, 2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|
900.0
|
|
||
July 7 - August 3, 2019
|
|
881,624
|
|
|
100.22
|
|
|
881,624
|
|
|
811.6
|
|
||
Total
|
|
881,624
|
|
|
$
|
100.22
|
|
|
881,624
|
|
|
$
|
811.6
|
|
|
|
|
DOLLAR TREE, INC.
|
|
|
|
|
Date:
|
August 29, 2019
|
By:
|
/s/ Kevin S. Wampler
|
|
|
Kevin S. Wampler
|
|
|
|
Chief Financial Officer
|
|
|
|
(principal financial officer)
|
(a)
|
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;
|
(b)
|
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;
|
(c)
|
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
|
(d)
|
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
|
(a)
|
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
|
(b)
|
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.
|
/s/ Gary Philbin
|
|
Gary Philbin
|
|
President and Chief Executive Officer
|
|
(a)
|
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;
|
(b)
|
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;
|
(c)
|
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
|
(d)
|
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
|
(a)
|
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
|
(b)
|
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.
|
/s/ Kevin S. Wampler
|
|
Kevin S. Wampler
|
|
Chief Financial Officer
|
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
August 29, 2019
|
/s/ Gary Philbin
|
Date
|
Gary Philbin
|
|
President and Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
August 29, 2019
|
/s/ Kevin S. Wampler
|
Date
|
Kevin S. Wampler
|
|
Chief Financial Officer
|