Dollar Tree looking at options for Family Dollar, including possible sale of the segment

Discount retailer Dollar Tree said it’s looking at strategic options for the Family Dollar stores it owns, including a possible sale of the segment.

Dollar Tree said Wednesday alternatives also include a spinoff or other disposition of the business.

Dollar Tree acquired Family Dollar nearly a decade ago for more than $8 billion after a bidding war with rival Dollar General.

But the company has had difficulty incorporating Family Dollar into its business and recently announced it would close nearly 1,000 stores, with most of them being Family Dollar locations.

Dollar Tree operates 16,397 stores across 48 states and five Canadian provinces, including 20 Dollar Tree and 14 Family Dollar stores in Hamilton County.

Last year, Dollar Tree launched a comprehensive review of Family Dollar, which included the planned closure of about 970 under-performing Family Dollar locations.

Dollar Tree said it doesn’t have a set deadline or timetable for completing its review of strategic alternatives.

“Dollar Tree has been on a multiyear journey to help the company fully achieve its potential,” company CEO Rick Dreiling said in an earnings report Wednesday. “We are already beginning to see progress in this targeted strategy in the streamlined Family Dollar banner. At the same time, we continue to aggressively grow the Dollar Tree banner through compelling initiatives like our expanded multiprice offerings, significant planned new store openings across the United States.

The Family Dollar announcement comes about a week after Dollar Tree said it would reopen nearly 200 shuttered 99 Cents Only stores from Texas to California as Dollar Tree locations after the leases were secured out of bankruptcy proceedings. The transfer of designation rights for 170 locations in Texas, Arizona, Nevada and California, along with some of the furniture, equipment and fixtures inside, was approved by the U.S. Bankruptcy Court for the District of Delaware.

Dollar Tree also announced its fiscal first-quarter financial results Wednesday, reporting an adjusted profit of $1.43 per share on revenue of $7.63 billion. The performance met the expectations of analysts surveyed by Zacks Investment Research.

For the second quarter, Dollar Tree anticipates earnings in a range of $1 to $1.10 per share with revenue of $7.3 billion to $7.6 billion. Analysts polled by FactSet predict earnings of $1.19 per share on revenue of $7.59 billion.

Dollar Tree expects full-year earnings between $6.50 and $7 per share on revenue in a range of $31 billion to $32 billion. Wall Street is looking for earnings of $6.89 per share on revenue of $31.36 billion.

Dollar Tree, which has stores under the brands Family Dollar and Dollar Tree Canada and its namesake, was operating 16,397 stores across 48 states and five Canadian provinces as of May 4.

Shares of Dollar Tree Inc., based in Chesapeake, Virginia, fell Wednesday by more than 4.9%, closing down $5.92 per share to end the day at $114.38 per share.