Family Dollar (FDO) cites an intense promotional atmosphere as a major factor in why comparable store sales fell during FQ1.
The company saw sales in its consumables category increase 4.7% during the period as demand for food and tobacco improved. The different mix helped Family Dollar's gross margin rate improve 20 bps to 34.1%.
Sales for discretionary items such as apparel were weak during the quarter.
The guidance cuts from the company are steep and harsh: FQ2 EPS of $0.85-$0.95 vs. consensus of $1.21 and FY2014 EPS of $3.25-$3.55 vs. consensus of $3.98.
FDO -8.1% premarket