Family Dollar (NYSE:FDO) reported results for its third quarter that missed analyst estimates as gross margins fell due to intensifying competition.
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Earnings were $124.5 million ($1.06 per share) compared to $111.1 million (91 cents a share) last year. Revenue improved 9.6 percent to $2.36 billion with same store sales climbed 5 percent. Analysts had expected earnings per share of $1.07 a share.
Gross margin was down 0.4 points to 35.8 percent of sales due to markdowns as rivals Dollar General (NYSE:DG) and Wal-Mart (NYSE:WMT) have been offering tough competition. Private brand sales have helped reduce this impact, however.
For the current quarter, the company forecasts earnings per share of between 71 cents to 81 cents, while analysts estimate 77 cents per share. Same store sales are expected to rise between 5 and 7 percent.
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