8-KOther Events

DOLLAR TREE, INC. 8-K Report (May 20, 2003)

Filed May 20, 2003For Securities:DLTR

Summary

Dollar Tree Stores, Inc. announced on May 15, 2003, a binding agreement to acquire Greenbacks, Inc. for approximately $100 million in cash, with an expected closing in mid-June 2003. This strategic acquisition will add 96 stores across 10 western states to Dollar Tree's portfolio, significantly expanding its geographical reach and selling square footage. Greenbacks, a privately held company, generated $127.5 million in sales in 2002 and has demonstrated strong historical sales growth. The acquisition is expected to be accretive to Dollar Tree's earnings per share (EPS), contributing an estimated 2-3 cents in the current fiscal year and at least 7 cents in fiscal year 2004. The integration plan includes converting Greenbacks stores to the Dollar Tree banner and merchandise mix within 18 months, along with optimizing distribution and point-of-sale systems. The company anticipates a substantial increase in selling square footage growth for fiscal year 2003, projecting a range of 28-30% compared to the previously guided 22%.

Key Highlights

  • 1Dollar Tree is acquiring Greenbacks, Inc. for approximately $100 million in cash.
  • 2The acquisition adds 96 stores in 10 western states, expanding Dollar Tree's footprint.
  • 3Greenbacks generated $127.5 million in sales in calendar year 2002 with strong historical growth.
  • 4The transaction is expected to be accretive to EPS, with 2-3 cents expected in FY2003 and at least 7 cents in FY2004.
  • 5Selling square footage growth for FY2003 is projected to increase to 28-30% due to the acquisition.
  • 6Integration plans include converting Greenbacks stores and systems within 18 months.
  • 7The acquisition is subject to customary closing conditions and regulatory approval.

Frequently Asked Questions

This 8-K filing announces Dollar Tree Stores, Inc.'s binding agreement to acquire Greenbacks, Inc. It also provides details about the transaction, its financial impact, integration plans, and forward-looking statements as required by Regulation FD.

The acquisition is expected to be accretive to Dollar Tree's earnings per share (EPS). The company anticipates 2-3 cents of EPS accretion in the current fiscal year (FY2003) and at least 7 cents of EPS accretion in fiscal year 2004. The transaction is expected to add significant sales and expand selling square footage.

Dollar Tree plans to convert Greenbacks stores to the Dollar Tree name and merchandise mix within 18 months. This includes installing point-of-sale systems, remodeling select stores, and enhancing fixtures. The company also plans to integrate its warehouse management technology into Greenbacks' distribution center.

Key risks include the potential failure of the acquisition to be consummated or to integrate successfully, adverse economic conditions, challenges in meeting expansion goals, disruptions in the supply chain for imported goods (potentially exacerbated by the SARS epidemic), competition, rising operating costs, and the capacity of the distribution network.