(NewsNation) — Dollar Tree, Inc., which owns Dollar Tree and Family Dollar, will close about 1,000 stores as the discount retailer is looking to improve profitability.
Family Dollar will close about 600 stores in the first half of fiscal 2024 and shut down an additional 370 stores as their leases expire over the next several years. Dollar Tree will close 30 stores as leases expire, the company announced Wednesday.
“As we look forward in 2024, we are accelerating our multi-price rollout at Dollar Tree and taking decisive action to improve profitability and unlock value at Family Dollar,” said Rick Dreiling, chairman and CEO of Dollar Tree, Inc.
The company said it anticipates a benefit of 15 cents a share to 2024 earnings from the store closures.
The announcement comes amid a surprise fourth-quarter loss as the chain took a related $1.07 billion goodwill impairment charge. Shares tumbled 15% before the opening bell Wednesday.
For the three months ended Feb. 3, Dollar Tree lost $1.71 billion, or $7.85 per share. A year earlier the company earned $452.2 million, or $2.04 per share.
The company said it faced fourth-quarter adjusted earnings of $2.55 per share, including an impact of about 17 cents a share from general liability insurance claims. That’s still short of the per-share earnings of $2.67 expected on Wall Street, according to a survey by Zacks Investment Research.
For fiscal 2024, Dollar Tree anticipates earnings between $6.70 and $7.30 per share. Revenue is expected in a range of $31 billion to $32 billion.
Dollar Tree expects first-quarter earnings of $1.33 to $1.48 per share on revenue in a range of $7.6 billion to $7.9 billion.
As of last month, Dollar Tree opened more than 16,770 stores across 48 states and Canada.
Dollar Tree acquired Family Dollar in 2015 for $8 billion after a bidding war with rival Dollar General, but it has had difficulty absorbing the chain.