Dollar Tree adding locked cases, removing items from stores amid rising theft costs
Shoplifting, or “shrink,” as the industry refers to it, is a rising issue in the retail sector, and Dollar Tree (DLTR) announced Thursday that it is taking action to stop it. The bargain retailer’s shares dropped more than 12% on Thursday as a result of weaker-than-anticipated financial results and declining gross margins as a result of a change in consumer spending towards consumables and “elevated shrink.” The Gross Margins of the company are below expectations Sadly, the shrink headwinds we’re experiencing are currently muddling our margins, Dollar Tree CFO Jeff Davis said on the earnings call on Thursday. The company’s gross margins for the most recent quarter were 29.2%, below the consensus estimate of 29.7% and down 220 basis points from the same quarter a year earlier. The quarterly profit at Dollar Tree, which came to $0.91 per share, was higher than expected ($0.87 per share). However, the company’s third-quarter earnings prediction fell short of expectations, with $0.94 to $...