Family Dollar Stores (NYSE:FDO) announced a fourth quarter profit that met Wall Street analyst estimates, earning $80.9 million (69 cents per share) up from $79.8 million (66 cents per share) last year, right in line with estimates.
Sales rose 10.8% to $2.36 billion, also in line with analyst estimates, as the company’s move to adding more products to its shelves, and in particular food, health, beauty items and tobacco, have consumers looking at Family Dollar as an alternative to discount retailers including Dollar General (NYSE:DG) and Dollar Tree (NASDAQ:DLTR). Sales at stores open more than 14 months rose 5.4%, above the company’s forecast 5% growth figure.
FDO is also following a growth plan that includes building more distribution cents, with plans to spend up to $650 million in 2013 compared to $603 million in 2012 and $345 million in 2011. FDO hopes to see earnings increase as a result of the product and expansion efforts, with the company providing a full-year 2013 earnings expectation of $4.10 to $4.40 per share, right in the middle of analyst’s $4.22 per share estimates.
FDO shares were up nearly 5% in early morning trading on the news, and is up nearly 20% year-to-date.
Written by Marc Bastow, Assistant Editor at InvestorPlace.com. As of this writing, Mr. Bastow did not hold a position in any of the aforementioned securities.