Cover Page
Cover Page - shares | 9 Months Ended | |
Nov. 02, 2019 | Nov. 22, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Nov. 2, 2019 | |
Document Transition Report | false | |
Entity File Number | 0-25464 | |
Entity Registrant Name | DOLLAR TREE, INC. | |
Entity Incorporation, State or Country Code | VA | |
Entity Tax Identification Number | 26-2018846 | |
Entity Address, Address Line One | 500 Volvo Parkway | |
Entity Address, City or Town | Chesapeake, | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 23320 | |
City Area Code | 757 | |
Local Phone Number | 321-5000 | |
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | DLTR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 236,662,306 | |
Entity Central Index Key | 0000935703 | |
Current Fiscal Year End Date | --02-01 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED INCOME S
CONDENSED CONSOLIDATED INCOME STATEMENTS - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2019 | Nov. 03, 2018 | Nov. 02, 2019 | Nov. 03, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 5,746.2 | $ 5,538.8 | $ 17,295.5 | $ 16,618.1 |
Cost of sales | 4,041.7 | 3,866.9 | 12,215.3 | 11,582.7 |
Gross profit | 1,704.5 | 1,671.9 | 5,080.2 | 5,035.4 |
Selling, general and administrative expenses | 1,346.1 | 1,284.1 | 4,067.4 | 3,827.5 |
Operating income | 358.4 | 387.8 | 1,012.8 | 1,207.9 |
Interest expense, net | 41.4 | 47.6 | 122.9 | 323.7 |
Other expense (income), net | 0.1 | 0.2 | 0.7 | (0.9) |
Income before income taxes | 316.9 | 340 | 889.2 | 885.1 |
Provision for income taxes | 61.1 | 58.2 | 185.2 | 168.9 |
Net income | $ 255.8 | $ 281.8 | $ 704 | $ 716.2 |
Basic net income per share (USD per share) | $ 1.08 | $ 1.18 | $ 2.97 | $ 3.01 |
Diluted net income per share (USD per share) | $ 1.08 | $ 1.18 | $ 2.95 | $ 3 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2019 | Nov. 03, 2018 | Nov. 02, 2019 | Nov. 03, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 255.8 | $ 281.8 | $ 704 | $ 716.2 |
Foreign currency translation adjustments | 0.4 | (0.7) | (0.9) | (5.9) |
Total comprehensive income | $ 256.2 | $ 281.1 | $ 703.1 | $ 710.3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) shares in Millions, $ in Millions | Nov. 02, 2019 | Feb. 02, 2019 | Nov. 03, 2018 |
Current assets: | |||
Cash and cash equivalents | $ 433.7 | $ 422.1 | $ 708.3 |
Merchandise inventories | 3,882.9 | 3,536 | 3,715.6 |
Other current assets | 255.7 | 335.2 | 325.6 |
Total current assets | 4,572.3 | 4,293.3 | 4,749.5 |
Property, plant and equipment, net of accumulated depreciation of $4,056.6, $3,690.6 and $3,571.8, respectively | 3,810.7 | 3,445.3 | 3,406.2 |
Restricted cash | 46.6 | 24.6 | 0 |
Operating lease right-of-use assets | 5,864.6 | ||
Goodwill | 2,296.5 | 2,296.6 | 5,023.6 |
Favorable lease rights, net of accumulated amortization of $287.8 and $290.6 at February 2, 2019 and November 3, 2018, respectively | 288.7 | 314.6 | |
Trade name intangible asset | 3,100 | 3,100 | 3,100 |
Other assets | 51.4 | 52.7 | 55.4 |
Total assets | 19,742.1 | 13,501.2 | 16,649.3 |
Current liabilities: | |||
Current portion of long-term debt | 750 | 0 | 0 |
Current portion of operating lease liabilities | 1,202.6 | ||
Accounts payable | 1,473.1 | 1,416.4 | 1,365.1 |
Income taxes payable | 0 | 60 | 0.7 |
Other current liabilities | 754 | 619.3 | 769.9 |
Total current liabilities | 4,179.7 | 2,095.7 | 2,135.7 |
Long-term debt, net, excluding current portion | 3,520.2 | 4,265.3 | 5,043.8 |
Operating lease liabilities, long-term | 4,636 | ||
Unfavorable lease rights, net of accumulated amortization of $76.9 and $77.0 at February 2, 2019 and November 3, 2018, respectively | 78.8 | 84 | |
Deferred income taxes, net | 1,001.5 | 973.2 | 999.2 |
Income taxes payable, long-term | 29.7 | 35.4 | 33 |
Other liabilities | 253.7 | 409.9 | 410.5 |
Total liabilities | 13,620.8 | 7,858.3 | 8,706.2 |
Commitments and contingencies | |||
Shareholders’ equity | 6,121.3 | 5,642.9 | 7,943.1 |
Total liabilities and shareholders’ equity | $ 19,742.1 | $ 13,501.2 | $ 16,649.3 |
Common shares outstanding (in shares) | 236.7 | 238.1 | 238 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Nov. 02, 2019 | Feb. 02, 2019 | Nov. 03, 2018 |
Statement of Financial Position [Abstract] | |||
Accumulated depreciation, property, plant and equipment | $ 4,056.6 | $ 3,690.6 | $ 3,571.8 |
Accumulated amortization, favorable lease rights | 287.8 | 290.6 | |
Accumulated amortization, unfavorable lease rights | $ 76.9 | $ 77 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Millions | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings |
Beginning balance (in shares) at Feb. 03, 2018 | 237,300,000 | ||||
Beginning balance at Feb. 03, 2018 | $ 7,182.3 | $ 2.4 | $ 2,545.3 | $ (32.3) | $ 4,666.9 |
Statement of Stockholders' Equity [Roll Forward] | |||||
Net income | 716.2 | 716.2 | |||
Total other comprehensive income (loss) | (5.9) | (5.9) | |||
Issuance of stock under Employee Stock Purchase Plan (in shares) | 200,000 | ||||
Issuance of stock under Employee Stock Purchase Plan | 8 | 8 | |||
Exercise of stock options (in shares) | 100,000 | ||||
Exercise of stock options | 6.2 | 6.2 | |||
Stock-based compensation, net (in shares) | 400,000 | ||||
Stock-based compensation, net | 36.3 | 36.3 | |||
Ending balance (in shares) at Nov. 03, 2018 | 238,000,000 | ||||
Ending balance at Nov. 03, 2018 | 7,943.1 | $ 2.4 | 2,595.8 | (38.2) | 5,383.1 |
Beginning balance (in shares) at Aug. 04, 2018 | 237,900,000 | ||||
Beginning balance at Aug. 04, 2018 | 7,647.5 | $ 2.4 | 2,581.3 | (37.5) | 5,101.3 |
Statement of Stockholders' Equity [Roll Forward] | |||||
Net income | 281.8 | 281.8 | |||
Total other comprehensive income (loss) | (0.7) | (0.7) | |||
Issuance of stock under Employee Stock Purchase Plan (in shares) | 100,000 | ||||
Issuance of stock under Employee Stock Purchase Plan | 2.1 | 2.1 | |||
Exercise of stock options (in shares) | 0 | ||||
Exercise of stock options | 1.9 | 1.9 | |||
Stock-based compensation, net (in shares) | 0 | ||||
Stock-based compensation, net | 10.5 | 10.5 | |||
Ending balance (in shares) at Nov. 03, 2018 | 238,000,000 | ||||
Ending balance at Nov. 03, 2018 | 7,943.1 | $ 2.4 | 2,595.8 | (38.2) | 5,383.1 |
Beginning balance (in shares) at Feb. 02, 2019 | 238,100,000 | ||||
Beginning balance at Feb. 02, 2019 | 5,642.9 | $ 2.4 | 2,602.7 | (38.3) | 3,076.1 |
Statement of Stockholders' Equity [Roll Forward] | |||||
Net income | 704 | 704 | |||
Total other comprehensive income (loss) | (0.9) | (0.9) | |||
Issuance of stock under Employee Stock Purchase Plan (in shares) | 100,000 | ||||
Issuance of stock under Employee Stock Purchase Plan | 7.5 | 7.5 | |||
Exercise of stock options | 4.9 | 4.9 | |||
Stock-based compensation, net (in shares) | 400,000 | ||||
Stock-based compensation, net | $ 28.2 | 28.2 | |||
Repurchase of stock (in shares) | (1,967,355) | (1,900,000) | |||
Repurchase of stock | $ (200) | (200) | |||
Ending balance (in shares) at Nov. 02, 2019 | 236,700,000 | ||||
Ending balance at Nov. 02, 2019 | 6,121.3 | $ 2.4 | 2,443.3 | (39.2) | 3,714.8 |
Beginning balance (in shares) at Aug. 03, 2019 | 236,800,000 | ||||
Beginning balance at Aug. 03, 2019 | 5,865.7 | $ 2.4 | 2,443.9 | (39.6) | 3,459 |
Statement of Stockholders' Equity [Roll Forward] | |||||
Net income | 255.8 | 255.8 | |||
Total other comprehensive income (loss) | 0.4 | 0.4 | |||
Issuance of stock under Employee Stock Purchase Plan | 2.3 | 2.3 | |||
Exercise of stock options | 0.8 | 0.8 | |||
Stock-based compensation, net | $ 7.9 | 7.9 | |||
Repurchase of stock (in shares) | (125,048) | (100,000) | |||
Repurchase of stock | $ (11.6) | (11.6) | |||
Ending balance (in shares) at Nov. 02, 2019 | 236,700,000 | ||||
Ending balance at Nov. 02, 2019 | $ 6,121.3 | $ 2.4 | $ 2,443.3 | $ (39.2) | $ 3,714.8 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Nov. 02, 2019 | Nov. 03, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 704 | $ 716.2 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 466.3 | 454.4 |
Provision for deferred income taxes | 50.3 | 13.8 |
Amortization of debt discount and debt-issuance costs | 4.9 | 53.7 |
Other non-cash adjustments to net income | 76.7 | 63.3 |
Loss on debt extinguishment | 0 | 114.7 |
Changes in operating assets and liabilities | (287.7) | (365.2) |
Net cash provided by operating activities | 1,014.5 | 1,050.9 |
Cash flows from investing activities: | ||
Capital expenditures | (782.3) | (622.7) |
Proceeds from governmental grant | 16.5 | 0 |
Proceeds from (payments for) fixed asset disposition | (2.9) | |
Proceeds from (payments for) fixed asset disposition | 3.3 | |
Net cash used in investing activities | (768.7) | (619.4) |
Cash flows from financing activities: | ||
Proceeds from long-term debt, net of discount | 0 | 4,775.8 |
Principal payments for long-term debt | 0 | (5,432.7) |
Debt-issuance and debt extinguishment costs | 0 | (155.3) |
Proceeds from revolving credit facility | 0 | 50 |
Repayments of revolving credit facility | 0 | (50) |
Proceeds from stock issued pursuant to stock-based compensation plans | 12.3 | 14.2 |
Cash paid for taxes on exercises/vesting of stock-based compensation | (24.3) | (22.6) |
Payments for repurchase of stock | (200) | 0 |
Net cash used in financing activities | (212) | (820.6) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (0.2) | (0.4) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 33.6 | (389.5) |
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 | 480.3 | 708.3 |
Cash paid for: | ||
Interest, net of amounts capitalized | 89.7 | 289.3 |
Income taxes | 248.9 | 197.9 |
Non-cash transactions: | ||
Accrued capital expenditures | $ 73.8 | $ 51.2 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Nov. 02, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of Dollar Tree, Inc. and its wholly-owned subsidiaries (the “Company”) have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and are presented in accordance with the requirements of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in the Company’s Annual Report on Form 10-K for the year ended February 2, 2019 . The results of operations for the 13 and 39 weeks ended November 2, 2019 are not necessarily indicative of the results to be expected for the entire fiscal year ending February 1, 2020 . In the Company’s opinion, the unaudited condensed consolidated financial statements included herein contain all adjustments (including those of a normal recurring nature) considered necessary for a fair presentation of its financial position as of November 2, 2019 and November 3, 2018 and the results of its operations and cash flows for the periods presented. The February 2, 2019 balance sheet information was derived from the audited consolidated financial statements as of that date. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “ Leases (Topic 842)” and subsequent amendments, which replaced existing lease accounting guidance in GAAP and requires lessees to recognize right-of-use assets and corresponding lease liabilities on the balance sheet for all in-scope leases with a term of greater than 12 months and requires disclosure of certain quantitative and qualitative information pertaining to an entity’s leasing arrangements. The Company adopted the standard as of February 3, 2019, using the optional effective date transition method provided by accounting pronouncement, ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements” and recorded a cumulative effect adjustment to beginning retained earnings. The Company’s reporting for the comparative prior periods presented in the condensed consolidated financial statements continues to be in accordance with Accounting Standards Codification (“ASC”) 840, “ Leases (Topic 840). ” The Company elected the package of practical expedients permitted under the transition guidance within the new standard which, among other things, permitted the Company to carry forward the historical lease classification for leases that commenced before the effective date of the new standard. The Company did not elect the hindsight practical expedient, which permits the use of hindsight when determining lease term and impairment of right-of-use assets. Adoption of the standard resulted in the recognition of Operating lease right-of-use assets and Operating lease liabilities of $6.2 billion and $6.1 billion , respectively, and a reduction to Retained earnings of $65.3 million , net of tax, as of February 3, 2019. The Operating lease right-of-use assets recorded at transition include the impact of net favorable lease rights of approximately $210.0 million , accrued rent, net of prepaid rent of approximately $108.0 million , lease incentives of approximately $67.0 million and the impairment of right-of-use assets recognized in retained earnings as of February 3, 2019 of approximately $96.0 million . The adoption of the standard did not have a material impact on the Company’s condensed consolidated income statements or condensed consolidated statements of cash flows. Refer to Note 7 for additional information related to the Company’s accounting for leases. |
Legal Proceedings
Legal Proceedings | 9 Months Ended |
Nov. 02, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | Legal Proceedings The Company is a defendant in legal proceedings including a Food and Drug Administration (“FDA”) proceeding and the class, collective, representative and large cases described below as well as several thousand allegedly individual claims in arbitration. The arbitrations include more than 2,100 wage and hour claims recently filed by one law firm. The law firm also alleges they have more than 4,200 additional claims to be filed in the future. The Company will vigorously defend itself in all matters referred to in this Note 2. The Company does not believe that any of these matters will, individually or in the aggregate, have a material effect on its business or financial condition. The Company cannot give assurance, however, that one or more of these matters will not have a material effect on its results of operations for the quarter or year in which they are resolved. The Company assesses its legal proceedings and reserves are established if a loss is probable and the amount of such loss can be reasonably estimated. Many, if not substantially all, of the contingencies described below are subject to significant uncertainties and, therefore, determining the likelihood of a loss and the measurement of any loss can be complex and subject to judgment. With respect to legal proceedings where the Company has determined that a loss is reasonably possible but not probable, the Company is unable to estimate the amount or range of the reasonably possible loss due to the inherent difficulty of predicting the outcome of and uncertainties regarding legal proceedings. The Company’s assessments are based on estimates and assumptions that have been deemed reasonable by management, but that may prove to be incomplete or inaccurate, and unanticipated events and circumstances may occur that might cause the Company to change those estimates and assumptions. Management’s assessment of legal proceedings could change because of future determinations or the discovery of facts which are not presently known. Accordingly, the ultimate costs of resolving these proceedings may be substantially higher or lower than currently estimated. Dollar Tree Active Matters The FDA has recently alleged that the Company improperly sold certain topically applied, over the counter (“OTC”) products manufactured by certain Chinese factories that were on an import “alert” restriction issued by the FDA. The Company is in the process of responding to the FDA and proposing enhanced procedures and processes for any OTC products it imports from China. In April 2015, a distribution center employee filed a class action in California state court with allegations concerning wages, meal and rest breaks, recovery periods, wage statements and timely termination pay. The employee filed an amended complaint in which he abandoned his attempt to certify a nation-wide class of non-exempt distribution center employees for alleged improper calculation of overtime compensation. The Company removed this lawsuit to federal court. The court certified the case as a state-wide class action as to those employees who began working for the Company prior to October 6, 2014. In August 2018, a former employee brought suit in California state court as a class action and as a Private Attorney General Act (“PAGA”) representative suit alleging the Company failed to provide all non-exempt California store employees with compliant rest and meal breaks, accrued vacation, accurate wage statements and final pay upon termination of employment. In December 2018, two former employees brought a PAGA suit in California state court alleging that Dollar Tree Stores, Inc. and Dollar Tree Distribution, Inc. failed to provide non-exempt California store and distribution center employees with rest and meal breaks, suitable seating, overtime pay, minimum wage for all time worked, reporting time pay, accurate wage statements, timely payment of wages during and upon termination of employment, failed to reimburse business expenses, and made unlawful deductions from wage payments. Several lawsuits have been filed against Dollar Tree, Family Dollar and their vendors alleging that personal powder products caused cancer. The Company does not believe the products it sold caused the illnesses. The Company believes these lawsuits are insured and is being indemnified by its third party vendors. Dollar Tree Resolved Matters In 2015, a former store manager filed a class action in California federal court alleging, among other things, that the Company failed to make wage statements readily available to employees who did not receive paper checks. In 2017, a jury found in favor of the Company. In 2019, the 9th Circuit Court of Appeals affirmed the jury verdict. In July 2019, the plaintiff filed a petition with the Supreme Court of the United States seeking a review of the decision. The Supreme Court denied the petition. Family Dollar Active Matters In January 2017, a customer filed a class action in federal court in Illinois alleging the Company violated various state consumer fraud laws as well as express and implied warranties by selling a product that purported to contain aloe when it did not. The requested class is limited to the state of Illinois. The Company believes that it is fully indemnified by the entities that supplied it with the product. In July 2019, a customer filed a nationwide class action in federal court in Pennsylvania on behalf of all customers with mobility disabilities alleging the Company violated the public accommodation requirements of the Americans with Disabilities Act by systemically blocking the aisles with merchandise. The customer seeks a permanent injunction requiring the Company to remove all access barriers and giving the customer authority to monitor the Company’s compliance. Family Dollar Resolved Matters In January 2018, a former store manager and a former assistant store manager filed suit in California state court asserting class claims on behalf of themselves and their respective classes seeking to recover for working off the clock, noncompliant rest and meal periods and related claims. The plaintiffs have since amended their complaint, abandoned their class and PAGA claims and are instead proceeding with their individual claims only. In June 2018, a former store manager filed suit in California state court asserting class and PAGA claims on behalf of himself and a class of current and former employees for alleged off the clock work, alleged failure to receive compliant rest and meal breaks and related claims. In May 2019, the case was resolved. In December 2018, a former assistant store manager filed a PAGA suit in California state court alleging the Company failed to provide rest and meal breaks, failed to pay minimum, regular and overtime wages, failed to maintain accurate records and provide accurate wage statements, failed to timely pay wages due upon termination of employment and failed to reimburse employees for business expenses. In April 2019, the case was dismissed without prejudice. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Nov. 02, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements As required, financial assets and liabilities are classified in the fair value hierarchy in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table sets forth the Company’s financial assets and liabilities that are measured at fair value on a recurring basis: (in millions) November 2, February 2, November 3, Level 1 Deferred compensation plan assets $ 21.8 $ 21.8 $ 21.8 Deferred compensation plan assets are held pursuant to deferred compensation plans for certain officers and executives. The deferred compensation plan assets are recorded in "Other assets" within the accompanying unaudited condensed consolidated balance sheets and a corresponding liability is recorded in "Other liabilities" within the accompanying unaudited condensed consolidated balance sheets. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (e.g., when there is evidence of impairment). The Company did not record any significant impairment charges during the 13 or 39 weeks ended November 2, 2019 and November 3, 2018 . Fair Value of Financial Instruments The carrying amounts of Cash and cash equivalents, Restricted cash and Accounts payable as reported in the accompanying unaudited condensed consolidated balance sheets approximate fair value due to their short-term maturities. The aggregate fair values and carrying values of the Company’s long-term borrowings were as follows: November 2, 2019 February 2, 2019 November 3, 2018 (in millions) Fair Value Carrying Value Fair Value Carrying Value Fair Value Carrying Value Level 1 Senior Notes $ 4,530.3 $ 4,278.6 $ 4,198.6 $ 4,275.5 $ 4,158.7 $ 4,274.4 Level 2 Term Loan Facility — — — — 774.2 780.2 The fair values of the Company’s Senior Notes were determined using Level 1 inputs as quoted prices in active markets for identical assets or liabilities are available. The fair value of the Company’s Term Loan Facility, which the Company prepaid in full during the fourth quarter of fiscal 2018, was determined using Level 2 inputs as quoted prices are readily available from pricing services, but the prices are not published. The carrying value of the Company’s Revolving Credit Facility approximated its fair value because the interest rates vary with market interest rates. |
Net Income Per Share
Net Income Per Share | 9 Months Ended |
Nov. 02, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income Per Share The following table sets forth the calculations of basic and diluted net income per share: 13 Weeks Ended 39 Weeks Ended November 2, November 3, November 2, November 3, (in millions, except per share data) 2019 2018 2019 2018 Basic net income per share: Net income $ 255.8 $ 281.8 $ 704.0 $ 716.2 Weighted average number of shares outstanding 236.7 237.9 237.4 237.8 Basic net income per share $ 1.08 $ 1.18 $ 2.97 $ 3.01 Diluted net income per share: Net income $ 255.8 $ 281.8 $ 704.0 $ 716.2 Weighted average number of shares outstanding 236.7 237.9 237.4 237.8 Dilutive effect of stock options and restricted stock (as 0.8 0.8 0.9 0.8 Weighted average number of shares and dilutive potential 237.5 238.7 238.3 238.6 Diluted net income per share $ 1.08 $ 1.18 $ 2.95 $ 3.00 For the 13 and 39 weeks ended November 2, 2019 and November 3, 2018 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Nov. 02, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation For a discussion of the Company’s stock-based compensation plans, refer to “Note 10 - Stock-Based Compensation Plans” of the Company’s Annual Report on Form 10-K for the year ended February 2, 2019 . Stock-based compensation expense was $52.5 million and $60.2 million during the 39 weeks ended November 2, 2019 and November 3, 2018 , respectively. Restricted Stock The Company issues service-based RSUs to employees and officers and issues performance-based RSUs to certain officers of the Company. The Company recognizes expense based on the estimated fair value of the RSUs granted over the requisite service period, which is generally three years , on a straight-line basis or a shorter period based on the retirement eligibility of the grantee. The fair value of RSUs is determined using the Company’s closing stock price on the date of grant. The following table summarizes the status of RSUs as of November 2, 2019 and changes during the 39 weeks then ended: Number of Shares Weighted Average Grant Date Fair Value Nonvested at February 2, 2019 1,446,100 $ 86.96 Granted 768,014 103.69 Vested (653,251 ) 84.79 Forfeited (117,445 ) 94.77 Nonvested at November 2, 2019 1,443,418 $ 96.04 |
Segments
Segments | 9 Months Ended |
Nov. 02, 2019 | |
Segment Reporting [Abstract] | |
Segments | Segments The Company operates a chain of more than 15,200 retail discount stores in 48 states and five Canadian provinces. The Company’s operations are conducted in two reporting business segments: Dollar Tree and Family Dollar. The Company defines its segments as those operations whose results its chief operating decision maker (“CODM”) regularly reviews to analyze performance and allocate resources. The Dollar Tree segment is the leading operator of discount variety stores offering merchandise at the fixed price of $1.00 . The Dollar Tree segment includes the Company’s operations under the “Dollar Tree” and “Dollar Tree Canada” brands, 13 distribution centers in the United States and two distribution centers in Canada. The Family Dollar segment operates a chain of general merchandise retail discount stores providing consumers with a selection of competitively-priced merchandise in convenient neighborhood stores. The Family Dollar segment consists of the Company’s operations under the “Family Dollar” brand and 11 distribution centers. The Company measures the results of its segments using, among other measures, each segment’s net sales, gross profit and operating income. The CODM reviews these metrics for each of the Company’s reporting segments. The Company may revise the measurement of each segment’s operating income, as determined by the information regularly reviewed by the CODM. If the measurement of a segment changes, prior period amounts and balances are reclassified to be comparable to the current period’s presentation. In the current year, the Company identified Corporate and support costs, mainly store support center costs that are considered shared services, and excluded these selling, general and administrative costs from its two reporting business segments. These costs include operating expenses for the Company’s store support centers in Chesapeake, Virginia and Matthews, North Carolina. During fiscal 2019 the Company consolidated its Matthews, North Carolina store support center with its store support center in Chesapeake, Virginia. The Company continues to own its facility in Matthews, North Carolina. Amounts for the 13 and 39 weeks ended November 3, 2018 have been reclassified to be comparable to the current year presentation. Information for the Company’s segments, as well as for Corporate and support, including the reconciliation to Income before income taxes, is as follows: 13 Weeks Ended 39 Weeks Ended November 2, November 3, November 2, November 3, (in millions) 2019 2018 2019 2018 Condensed Consolidated Income Statement Data: Net sales: Dollar Tree $ 3,074.3 $ 2,853.8 $ 8,991.4 $ 8,407.0 Family Dollar 2,671.9 2,685.0 8,304.1 8,211.1 Consolidated Net sales $ 5,746.2 $ 5,538.8 $ 17,295.5 $ 16,618.1 Gross profit: Dollar Tree $ 1,050.5 $ 993.7 $ 3,070.8 $ 2,909.8 Family Dollar 654.0 678.2 2,009.4 2,125.6 Consolidated Gross profit $ 1,704.5 $ 1,671.9 $ 5,080.2 $ 5,035.4 Operating income (loss): Dollar Tree $ 371.7 $ 366.4 $ 1,096.7 $ 1,069.9 Family Dollar 53.8 83.7 159.5 341.2 Corporate and support (67.1 ) (62.3 ) (243.4 ) (203.2 ) Consolidated Operating income 358.4 387.8 1,012.8 1,207.9 Interest expense, net 41.4 47.6 122.9 323.7 Other expense (income), net 0.1 0.2 0.7 (0.9 ) Income before income taxes $ 316.9 $ 340.0 $ 889.2 $ 885.1 As of November 2, February 2, November 3, (in millions) 2019 2019 2018 Condensed Consolidated Balance Sheet Data: Goodwill: Dollar Tree $ 421.6 $ 376.5 $ 373.5 Family Dollar 1,874.9 1,920.1 4,650.1 Consolidated Goodwill $ 2,296.5 $ 2,296.6 $ 5,023.6 Total assets: Dollar Tree $ 7,531.0 $ 3,992.6 $ 4,320.9 Family Dollar 11,858.3 9,144.7 11,955.3 Corporate and support 352.8 363.9 373.1 Consolidated Total assets $ 19,742.1 $ 13,501.2 $ 16,649.3 *Goodwill is reassigned between segments when stores are re-bannered between segments. In the 39 weeks ended November 2, 2019 and November 3, 2018 , the Company reassigned $45.2 million and $28.0 million , respectively, of goodwill from Family Dollar to Dollar Tree as a result of re-bannering. |
Leases
Leases | 9 Months Ended |
Nov. 02, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company’s lease portfolio primarily consists of leases for its retail store locations and it also leases vehicles and trailers, as well as distribution center space and equipment. The Company determines if an arrangement is a lease at inception by evaluating whether the arrangement conveys the right to use an identified asset and whether the Company obtains substantially all of the economic benefits from and has the ability to direct the use of the asset. Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets; the Company recognizes expense for these leases on a straight-line basis over the lease term. For leases with an initial term in excess of 12 months, operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the committed lease term at the lease commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate in determining the present value of future lease payments. Inputs to the calculation of the Company’s incremental borrowing rate include the valuations and yields of its outstanding senior notes and their credit spread over comparable U.S. Treasury rates, adjusted to a collateralized basis by estimating the credit spread improvement that would result from an upgrade of one ratings classification. Most leases include one or more options to renew and the exercise of renewal options is at the Company’s sole discretion. The Company does not include renewal options in its determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement. Operating lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The operating lease right-of-use asset is reduced by lease incentives, which has the effect of lowering the operating lease expense. Operating lease right-of-use assets are periodically reviewed for impairment losses. The Company uses the long-lived assets impairment guidance in ASC Subtopic 360-10, “Property, Plant, and Equipment - Overall,” to determine whether a right-of-use asset is impaired, and if so, the amount of the impairment loss to recognize. Certain of the Company’s lease agreements include rental payments based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. In addition, the Company’s real estate leases generally require payment of real estate taxes, common area maintenance and insurance, which are generally variable and based on actual costs incurred by the lessor. These variable payments are expensed as incurred as variable lease costs. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive financial covenants. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain equipment leases, such as trailers, the Company accounts for the lease and non-lease components as a single lease component. The lease cost for operating leases that was recognized in the accompanying unaudited condensed consolidated income statements was as follows: 13 Weeks Ended 39 Weeks Ended (in millions) November 2, 2019 November 2, 2019 Operating lease cost $ 378.2 $ 1,139.8 Variable lease cost 94.7 272.2 Total lease cost* $ 472.9 $ 1,412.0 *Excludes short-term lease cost and sublease income, which are immaterial As of November 2, 2019 , maturities of lease liabilities were as follows: (in millions) Remainder of 2019 $ 249.0 2020 1,376.2 2021 1,190.9 2022 990.6 2023 771.9 Thereafter 2,215.4 Total undiscounted lease payments 6,794.0 Less interest 955.4 Present value of lease liabilities $ 5,838.6 The future minimum lease payments above exclude $260.9 million of legally binding minimum lease payments for leases signed but not yet commenced as of November 2, 2019 . Information regarding the weighted-average remaining lease term and the weighted-average discount rate for operating leases as of November 2, 2019 is as follows: Weighted-average remaining lease term (years) 6.5 Weighted-average discount rate 4.4 % The following represents supplemental information pertaining to the Company’s operating lease arrangements for the 13 and 39 weeks ended November 2, 2019 : 13 Weeks Ended 39 Weeks Ended (in millions) November 2, 2019 November 2, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 367.5 $ 1,099.1 Right-of-use assets obtained in exchange for new operating lease liabilities 163.9 593.2 As previously disclosed in the Company’s Annual Report on Form 10-K for the year ended February 2, 2019 and in accordance with ASC 840, future minimum lease payments under non-cancellable operating leases were as follows as of February 2, 2019: (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 above future minimum lease payments include amounts for leases that were signed prior to February 2, 2019 for stores that were not open as of February 2, 2019 and exclude contingent rentals that may be paid under certain store leases based on a percentage of sales in excess of stipulated amounts. As of February 2, 2019, future minimum lease payments have not been reduced by expected future minimum sublease rentals of $1.2 million under operating leases. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Nov. 02, 2019 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity The Company repurchased 125,048 and 1,967,355 shares of common stock on the open market for approximately $11.6 million and $200.0 million during the 13 and 39 weeks ended November 2, 2019 , respectively. As of November 2, 2019 , the Company has $800.0 million remaining under Board repurchase authorization. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Nov. 02, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “ Leases (Topic 842)” and subsequent amendments, which replaced existing lease accounting guidance in GAAP and requires lessees to recognize right-of-use assets and corresponding lease liabilities on the balance sheet for all in-scope leases with a term of greater than 12 months and requires disclosure of certain quantitative and qualitative information pertaining to an entity’s leasing arrangements. The Company adopted the standard as of February 3, 2019, using the optional effective date transition method provided by accounting pronouncement, ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements” and recorded a cumulative effect adjustment to beginning retained earnings. The Company’s reporting for the comparative prior periods presented in the condensed consolidated financial statements continues to be in accordance with Accounting Standards Codification (“ASC”) 840, “ Leases (Topic 840). ” The Company elected the package of practical expedients permitted under the transition guidance within the new standard which, among other things, permitted the Company to carry forward the historical lease classification for leases that commenced before the effective date of the new standard. The Company did not elect the hindsight practical expedient, which permits the use of hindsight when determining lease term and impairment of right-of-use assets. Adoption of the standard resulted in the recognition of Operating lease right-of-use assets and Operating lease liabilities of $6.2 billion and $6.1 billion , respectively, and a reduction to Retained earnings of $65.3 million , net of tax, as of February 3, 2019. The Operating lease right-of-use assets recorded at transition include the impact of net favorable lease rights of approximately $210.0 million , accrued rent, net of prepaid rent of approximately $108.0 million , lease incentives of approximately $67.0 million and the impairment of right-of-use assets recognized in retained earnings as of February 3, 2019 of approximately $96.0 million . The adoption of the standard did not have a material impact on the Company’s condensed consolidated income statements or condensed consolidated statements of cash flows. Refer to Note 7 for additional information related to the Company’s accounting for leases. |
Legal Proceedings | The Company assesses its legal proceedings and reserves are established if a loss is probable and the amount of such loss can be reasonably estimated. Many, if not substantially all, of the contingencies described below are subject to significant uncertainties and, therefore, determining the likelihood of a loss and the measurement of any loss can be complex and subject to judgment. With respect to legal proceedings where the Company has determined that a loss is reasonably possible but not probable, the Company is unable to estimate the amount or range of the reasonably possible loss due to the inherent difficulty of predicting the outcome of and uncertainties regarding legal proceedings. The Company’s assessments are based on estimates and assumptions that have been deemed reasonable by management, but that may prove to be incomplete or inaccurate, and unanticipated events and circumstances may occur that might cause the Company to change those estimates and assumptions. Management’s assessment of legal proceedings could change because of future determinations or the discovery of facts which are not presently known. Accordingly, the ultimate costs of resolving these proceedings may be substantially higher or lower than currently estimated. |
Leases | The Company’s lease portfolio primarily consists of leases for its retail store locations and it also leases vehicles and trailers, as well as distribution center space and equipment. The Company determines if an arrangement is a lease at inception by evaluating whether the arrangement conveys the right to use an identified asset and whether the Company obtains substantially all of the economic benefits from and has the ability to direct the use of the asset. Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets; the Company recognizes expense for these leases on a straight-line basis over the lease term. For leases with an initial term in excess of 12 months, operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the committed lease term at the lease commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate in determining the present value of future lease payments. Inputs to the calculation of the Company’s incremental borrowing rate include the valuations and yields of its outstanding senior notes and their credit spread over comparable U.S. Treasury rates, adjusted to a collateralized basis by estimating the credit spread improvement that would result from an upgrade of one ratings classification. Most leases include one or more options to renew and the exercise of renewal options is at the Company’s sole discretion. The Company does not include renewal options in its determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement. Operating lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The operating lease right-of-use asset is reduced by lease incentives, which has the effect of lowering the operating lease expense. Operating lease right-of-use assets are periodically reviewed for impairment losses. The Company uses the long-lived assets impairment guidance in ASC Subtopic 360-10, “Property, Plant, and Equipment - Overall,” to determine whether a right-of-use asset is impaired, and if so, the amount of the impairment loss to recognize. Certain of the Company’s lease agreements include rental payments based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. In addition, the Company’s real estate leases generally require payment of real estate taxes, common area maintenance and insurance, which are generally variable and based on actual costs incurred by the lessor. These variable payments are expensed as incurred as variable lease costs. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive financial covenants. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. For certain equipment leases, such as trailers, the Company accounts for the lease and non-lease components as a single lease component. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Nov. 02, 2019 | |
Fair Value Disclosures [Abstract] | |
Financial assets and liabilities measured at fair value on a recurring basis | The following table sets forth the Company’s financial assets and liabilities that are measured at fair value on a recurring basis: (in millions) November 2, February 2, November 3, Level 1 Deferred compensation plan assets $ 21.8 $ 21.8 $ 21.8 |
Fair values and carrying values of long-term borrowings | The aggregate fair values and carrying values of the Company’s long-term borrowings were as follows: November 2, 2019 February 2, 2019 November 3, 2018 (in millions) Fair Value Carrying Value Fair Value Carrying Value Fair Value Carrying Value Level 1 Senior Notes $ 4,530.3 $ 4,278.6 $ 4,198.6 $ 4,275.5 $ 4,158.7 $ 4,274.4 Level 2 Term Loan Facility — — — — 774.2 780.2 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 9 Months Ended |
Nov. 02, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted net income per share | The following table sets forth the calculations of basic and diluted net income per share: 13 Weeks Ended 39 Weeks Ended November 2, November 3, November 2, November 3, (in millions, except per share data) 2019 2018 2019 2018 Basic net income per share: Net income $ 255.8 $ 281.8 $ 704.0 $ 716.2 Weighted average number of shares outstanding 236.7 237.9 237.4 237.8 Basic net income per share $ 1.08 $ 1.18 $ 2.97 $ 3.01 Diluted net income per share: Net income $ 255.8 $ 281.8 $ 704.0 $ 716.2 Weighted average number of shares outstanding 236.7 237.9 237.4 237.8 Dilutive effect of stock options and restricted stock (as 0.8 0.8 0.9 0.8 Weighted average number of shares and dilutive potential 237.5 238.7 238.3 238.6 Diluted net income per share $ 1.08 $ 1.18 $ 2.95 $ 3.00 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Nov. 02, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Summary of RSUs | The following table summarizes the status of RSUs as of November 2, 2019 and changes during the 39 weeks then ended: Number of Shares Weighted Average Grant Date Fair Value Nonvested at February 2, 2019 1,446,100 $ 86.96 Granted 768,014 103.69 Vested (653,251 ) 84.79 Forfeited (117,445 ) 94.77 Nonvested at November 2, 2019 1,443,418 $ 96.04 |
Segments (Tables)
Segments (Tables) | 9 Months Ended |
Nov. 02, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Information for the Company’s segments, as well as for Corporate and support, including the reconciliation to Income before income taxes, is as follows: 13 Weeks Ended 39 Weeks Ended November 2, November 3, November 2, November 3, (in millions) 2019 2018 2019 2018 Condensed Consolidated Income Statement Data: Net sales: Dollar Tree $ 3,074.3 $ 2,853.8 $ 8,991.4 $ 8,407.0 Family Dollar 2,671.9 2,685.0 8,304.1 8,211.1 Consolidated Net sales $ 5,746.2 $ 5,538.8 $ 17,295.5 $ 16,618.1 Gross profit: Dollar Tree $ 1,050.5 $ 993.7 $ 3,070.8 $ 2,909.8 Family Dollar 654.0 678.2 2,009.4 2,125.6 Consolidated Gross profit $ 1,704.5 $ 1,671.9 $ 5,080.2 $ 5,035.4 Operating income (loss): Dollar Tree $ 371.7 $ 366.4 $ 1,096.7 $ 1,069.9 Family Dollar 53.8 83.7 159.5 341.2 Corporate and support (67.1 ) (62.3 ) (243.4 ) (203.2 ) Consolidated Operating income 358.4 387.8 1,012.8 1,207.9 Interest expense, net 41.4 47.6 122.9 323.7 Other expense (income), net 0.1 0.2 0.7 (0.9 ) Income before income taxes $ 316.9 $ 340.0 $ 889.2 $ 885.1 As of November 2, February 2, November 3, (in millions) 2019 2019 2018 Condensed Consolidated Balance Sheet Data: Goodwill: Dollar Tree $ 421.6 $ 376.5 $ 373.5 Family Dollar 1,874.9 1,920.1 4,650.1 Consolidated Goodwill $ 2,296.5 $ 2,296.6 $ 5,023.6 Total assets: Dollar Tree $ 7,531.0 $ 3,992.6 $ 4,320.9 Family Dollar 11,858.3 9,144.7 11,955.3 Corporate and support 352.8 363.9 373.1 Consolidated Total assets $ 19,742.1 $ 13,501.2 $ 16,649.3 *Goodwill is reassigned between segments when stores are re-bannered between segments. In the 39 weeks ended November 2, 2019 and November 3, 2018 , the Company reassigned $45.2 million and $28.0 million , respectively, of goodwill from Family Dollar to Dollar Tree as a result of re-bannering. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Nov. 02, 2019 | |
Leases [Abstract] | |
Operating lease information | The following represents supplemental information pertaining to the Company’s operating lease arrangements for the 13 and 39 weeks ended November 2, 2019 : 13 Weeks Ended 39 Weeks Ended (in millions) November 2, 2019 November 2, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 367.5 $ 1,099.1 Right-of-use assets obtained in exchange for new operating lease liabilities 163.9 593.2 The lease cost for operating leases that was recognized in the accompanying unaudited condensed consolidated income statements was as follows: 13 Weeks Ended 39 Weeks Ended (in millions) November 2, 2019 November 2, 2019 Operating lease cost $ 378.2 $ 1,139.8 Variable lease cost 94.7 272.2 Total lease cost* $ 472.9 $ 1,412.0 *Excludes short-term lease cost and sublease income, which are immaterial Information regarding the weighted-average remaining lease term and the weighted-average discount rate for operating leases as of November 2, 2019 is as follows: Weighted-average remaining lease term (years) 6.5 Weighted-average discount rate 4.4 % |
Maturities of lease liabilities | As of November 2, 2019 , maturities of lease liabilities were as follows: (in millions) Remainder of 2019 $ 249.0 2020 1,376.2 2021 1,190.9 2022 990.6 2023 771.9 Thereafter 2,215.4 Total undiscounted lease payments 6,794.0 Less interest 955.4 Present value of lease liabilities $ 5,838.6 |
Future minimum lease payments in accordance with ASC 840 | As previously disclosed in the Company’s Annual Report on Form 10-K for the year ended February 2, 2019 and in accordance with ASC 840, future minimum lease payments under non-cancellable operating leases were as follows as of February 2, 2019: (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 |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ in Millions | Feb. 03, 2019 | Nov. 02, 2019 | Feb. 02, 2019 | Nov. 03, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | $ 5,864.6 | |||
Present value of lease liabilities | $ 5,838.6 | |||
Reduction to retained earnings | $ 65.3 | |||
Favorable lease rights, net of accumulated amortization of $287.8 and $290.6 at February 2, 2019 and November 3, 2018, respectively | $ 288.7 | $ 314.6 | ||
Retained Earnings | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Reduction to retained earnings | 65.3 | |||
ASU 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | 6,200 | |||
Present value of lease liabilities | 6,100 | |||
Accrued rent, net of prepaid rent | 108 | |||
Lease incentives | 67 | |||
Impairment of right-of-use assets recognized | 96 | |||
ASU 2016-02 | Favorable lease rights | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Favorable lease rights, net of accumulated amortization of $287.8 and $290.6 at February 2, 2019 and November 3, 2018, respectively | 210 | |||
ASU 2016-02 | Retained Earnings | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Reduction to retained earnings | $ 65.3 |
Legal Proceedings (Details)
Legal Proceedings (Details) - Pending litigation | 3 Months Ended | 12 Months Ended | |
Feb. 01, 2020claims | Dec. 31, 2018plantiff | Nov. 02, 2019claimsfirm | |
Wage and hourly claims | |||
Loss Contingencies [Line Items] | |||
Claims | 2,100 | ||
Number of law firms to file claims | firm | 1 | ||
Wage and hourly claims | Forecast | |||
Loss Contingencies [Line Items] | |||
Claims to be filed in the future | 4,200 | ||
Private Attorney General Act Lawsuit Against Dollar Tree Stores, Inc. and Dollar Tree Distribution, Inc. | Dollar Tree | |||
Loss Contingencies [Line Items] | |||
Loss contingency, number of plaintiffs | plantiff | 2 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Nov. 02, 2019 | Feb. 02, 2019 | Nov. 03, 2018 |
Fair value, recurring | Fair value, inputs, level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Deferred compensation plan assets | $ 21.8 | $ 21.8 | $ 21.8 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | Nov. 02, 2019 | Feb. 02, 2019 | Nov. 03, 2018 |
Fair Value | Fair value, inputs, level 1 | Senior Notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term borrowings | $ 4,530.3 | $ 4,198.6 | $ 4,158.7 |
Fair Value | Fair value, inputs, level 2 | Term Loan Facility | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term borrowings | 0 | 0 | 774.2 |
Carrying Value | Fair value, inputs, level 1 | Senior Notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term borrowings | 4,278.6 | 4,275.5 | 4,274.4 |
Carrying Value | Fair value, inputs, level 2 | Term Loan Facility | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term borrowings | $ 0 | $ 0 | $ 780.2 |
Net Income Per Share - Schedule
Net Income Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2019 | Nov. 03, 2018 | Nov. 02, 2019 | Nov. 03, 2018 | |
Basic net income per share: | ||||
Net income | $ 255.8 | $ 281.8 | $ 704 | $ 716.2 |
Weighted average number of shares outstanding (in shares) | 236.7 | 237.9 | 237.4 | 237.8 |
Basic net income per share (USD per share) | $ 1.08 | $ 1.18 | $ 2.97 | $ 3.01 |
Diluted net income per share: | ||||
Net income | $ 255.8 | $ 281.8 | $ 704 | $ 716.2 |
Weighted average number of shares outstanding (in shares) | 236.7 | 237.9 | 237.4 | 237.8 |
Dilutive effect of stock options and restricted stock (as determined by applying the treasury stock method) (in shares) | 0.8 | 0.8 | 0.9 | 0.8 |
Weighted average number of shares and dilutive potential shares outstanding (in shares) | 237.5 | 238.7 | 238.3 | 238.6 |
Diluted net income per share (USD per share) | $ 1.08 | $ 1.18 | $ 2.95 | $ 3 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 02, 2019 | Nov. 03, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 52.5 | $ 60.2 |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation expense, period | 3 years |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of RSUs (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2019 | Nov. 03, 2018 | Nov. 02, 2019 | Nov. 03, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | ||||
Operating income (loss) | $ 358.4 | $ 387.8 | $ 1,012.8 | $ 1,207.9 |
Restricted Stock Units (RSUs) | ||||
Number of Shares | ||||
Nonvested, beginning balance (in shares) | 1,446,100 | |||
Granted (in shares) | 768,014 | |||
Vested (in shares) | (653,251) | |||
Forfeited (in shares) | (117,445) | |||
Nonvested, Ending balance (in shares) | 1,443,418 | 1,443,418 | ||
Weighted Average Grant Date Fair Value | ||||
Nonvested, beginning balance (USD per share) | $ 86.96 | |||
Granted (USD per share) | 103.69 | |||
Vested (USD per share) | 84.79 | |||
Forfeited (USD per share) | 94.77 | |||
Nonvested, ending balance (USD per share) | $ 96.04 | $ 96.04 |
Segments - Narrative (Details)
Segments - Narrative (Details) | 9 Months Ended |
Nov. 02, 2019USD ($)statestoresegmentprovincedistribution_center | |
Segment Reporting Information [Line Items] | |
Number of retail discount stores | store | 15,200 |
Number of states/provinces the Company operates in | state | 48 |
Number of reporting business segments | segment | 2 |
Dollar Tree | |
Segment Reporting Information [Line Items] | |
Merchandise fixed price | $ | $ 1 |
Family Dollar | |
Segment Reporting Information [Line Items] | |
Number of distribution centers | 11 |
Canada | |
Segment Reporting Information [Line Items] | |
Number of states/provinces the Company operates in | province | 5 |
Canada | Dollar Tree | |
Segment Reporting Information [Line Items] | |
Number of distribution centers | 2 |
United States | Dollar Tree | |
Segment Reporting Information [Line Items] | |
Number of distribution centers | 13 |
Segments - Information For Segm
Segments - Information For Segments and Corporate and Support (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 02, 2019 | Nov. 03, 2018 | Nov. 02, 2019 | Nov. 03, 2018 | Feb. 02, 2019 | |
Condensed Consolidated Income Statement Data: | |||||
Net sales | $ 5,746.2 | $ 5,538.8 | $ 17,295.5 | $ 16,618.1 | |
Gross profit | 1,704.5 | 1,671.9 | 5,080.2 | 5,035.4 | |
Operating income (loss) | 358.4 | 387.8 | 1,012.8 | 1,207.9 | |
Interest expense, net | 41.4 | 47.6 | 122.9 | 323.7 | |
Other expense (income), net | 0.1 | 0.2 | 0.7 | (0.9) | |
Income before income taxes | 316.9 | 340 | 889.2 | 885.1 | |
Condensed Consolidated Balance Sheet Data: | |||||
Consolidated Goodwill | 2,296.5 | 5,023.6 | 2,296.5 | 5,023.6 | $ 2,296.6 |
Consolidated Total assets | 19,742.1 | 16,649.3 | 19,742.1 | 16,649.3 | 13,501.2 |
Corporate and support | |||||
Condensed Consolidated Income Statement Data: | |||||
Operating income (loss) | (67.1) | (62.3) | (243.4) | (203.2) | |
Condensed Consolidated Balance Sheet Data: | |||||
Consolidated Total assets | 352.8 | 373.1 | 352.8 | 373.1 | 363.9 |
Dollar Tree | |||||
Condensed Consolidated Income Statement Data: | |||||
Net sales | 3,074.3 | 2,853.8 | 8,991.4 | 8,407 | |
Gross profit | 1,050.5 | 993.7 | 3,070.8 | 2,909.8 | |
Condensed Consolidated Balance Sheet Data: | |||||
Goodwill transfers | 45.2 | 28 | |||
Dollar Tree | Operating segments | |||||
Condensed Consolidated Income Statement Data: | |||||
Operating income (loss) | 371.7 | 366.4 | 1,096.7 | 1,069.9 | |
Condensed Consolidated Balance Sheet Data: | |||||
Consolidated Goodwill | 421.6 | 373.5 | 421.6 | 373.5 | 376.5 |
Consolidated Total assets | 7,531 | 4,320.9 | 7,531 | 4,320.9 | 3,992.6 |
Family Dollar | |||||
Condensed Consolidated Income Statement Data: | |||||
Net sales | 2,671.9 | 2,685 | 8,304.1 | 8,211.1 | |
Gross profit | 654 | 678.2 | 2,009.4 | 2,125.6 | |
Condensed Consolidated Balance Sheet Data: | |||||
Goodwill transfers | (45.2) | (28) | |||
Family Dollar | Operating segments | |||||
Condensed Consolidated Income Statement Data: | |||||
Operating income (loss) | 53.8 | 83.7 | 159.5 | 341.2 | |
Condensed Consolidated Balance Sheet Data: | |||||
Consolidated Goodwill | 1,874.9 | 4,650.1 | 1,874.9 | 4,650.1 | 1,920.1 |
Consolidated Total assets | $ 11,858.3 | $ 11,955.3 | $ 11,858.3 | $ 11,955.3 | $ 9,144.7 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Nov. 02, 2019 | Nov. 02, 2019 | |
Lease, Cost [Abstract] | ||
Operating lease cost | $ 378.2 | $ 1,139.8 |
Variable lease cost | 94.7 | 272.2 |
Short-term lease cost | 0 | 0 |
Sublease income | 0 | 0 |
Total lease cost | $ 472.9 | $ 1,412 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Millions | Nov. 02, 2019USD ($) |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
Remainder of 2019 | $ 249 |
2020 | 1,376.2 |
2021 | 1,190.9 |
2022 | 990.6 |
2023 | 771.9 |
Thereafter | 2,215.4 |
Total undiscounted lease payments | 6,794 |
Less interest | 955.4 |
Present value of lease liabilities | $ 5,838.6 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | Nov. 02, 2019 | Feb. 02, 2019 |
Leases [Abstract] | ||
Leases signed but not yet commenced | $ 260.9 | |
Expected future minimum sublease rentals | $ 1.2 |
Leases - Weighted-Average Remai
Leases - Weighted-Average Remaining Lease Term and Discount Rate (Details) | Nov. 02, 2019 |
Leases [Abstract] | |
Weighted-average remaining lease term | 6 years 6 months |
Weighted-average discount rate | 4.40% |
Leases - Supplemental Informati
Leases - Supplemental Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Nov. 02, 2019 | Nov. 02, 2019 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 367.5 | $ 1,099.1 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 163.9 | $ 593.2 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments In Accordance with ASC 840 (Details) $ in Millions | Feb. 02, 2019USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2019 | $ 1,435.9 |
2020 | 1,176.7 |
2021 | 1,100 |
2022 | 899.6 |
2023 | 729.1 |
Thereafter | 1,966.3 |
Total minimum lease payments | $ 7,307.6 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Nov. 02, 2019USD ($)shares | Nov. 02, 2019USD ($)shares | |
Equity [Abstract] | ||
Repurchase of stock (in shares) | shares | 125,048 | 1,967,355 |
Repurchase of stock | $ 11.6 | $ 200 |
Remaining repurchase authorization | $ 800 | $ 800 |