UNITED STATES SECURITIES AND EXCHANGE COMMISSION

| June 13, 2016

Question
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10­K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended January 31, 2015
Commission File No.0­25464

DOLLAR TREE, INC.
(Exact name of registrant as specified in its charter)

Virginia
(State or other jurisdiction of
incorporation or organization)

26­2018846
(I.R.S. Employer
Identification No.)

500 Volvo Parkway, Chesapeake, VA 23320
(Address of principal executive offices)
Registrants telephone number, including area code: (757) 321­5000

Securities Registered Pursuant to Section 12(b) of the Act:
Title of Each Class
Name of Each Exchange on Which Registered
Common Stock (par value $.01 per share)
NASDAQ
Securities Registered Pursuant to Section 12(g) of the Act:
None
(Title of Class)
Indicate by check mark if the registrant is a well­known seasoned issuer, as defined in Rule 405 of the
Securities Act.

Yes (X) No ( )
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of
the Exchange Act.

Yes ( ) No (X)
Indicate by check mark whether Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes (X) No ( )
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website,
if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S­T
during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).

Yes (X) No ( )

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S­K is not contained
herein, and will not be contained, to the best of Registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10­K or any amendment to this Form 10­K. ( )
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non­accelerated
filer or a smaller reporting company. See definition of large accelerated filer, accelerated filer and smaller
reporting company in Rule 12b­2 of the Exchange Act.

Large accelerated filer (X)
Non­accelerated filer ( )

Accelerated filer ( )
Smaller reporting company ( )

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b­2 of the Exchange
Act).

Yes ( ) No (X)
The aggregate market value of Common Stock held by non­affiliates of the Registrant on August 1, 2014 , was
$10,784,848,842 , based on a $54.61 average of the high and low sales prices for the Common Stock on such
date. For purposes of this computation, all executive officers and directors have been deemed to be affiliates. Such
determination should not be deemed to be an admission that such executive officers and directors are, in fact,
affiliates of the Registrant.
On March 4, 2015 , there were 205,759,864 shares of the Registrants Common Stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
The information regarding securities authorized for issuance under equity compensation plans called for in Item 5 of
Part II and the information called for in Items 10, 11, 12, 13 and 14 of Part III are incorporated by reference to the
definitive Proxy Statement for the Annual Meeting of Stockholders of the Company to be held June 18, 2015 , which
will be filed with the Securities and Exchange Commission not later than May 29, 2015 .
2
DOLLAR TREE, INC.
TABLE OF CONTENTS

Item 1.

Item 1A.

Item 1B.

Item 2.

Page

PART I

BUSINESS

RISK FACTORS

UNRESOLVED STAFF COMMENTS

PROPERTIES

6
10
18
19

Item 3.

Item 4.

Item 5.

Item 6.

Item 7.

Item 7A.

Item 8.

Item 9.

Item 9A.

Item 9B.

Item 10.

Item 11.

Item 12.

Item 13.

Item 14.

Item 15.

LEGAL PROCEEDINGS

MINE SAFETY DISCLOSURES

PART II

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES

SELECTED FINANCIAL DATA

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

CONTROLS AND PROCEDURES

OTHER INFORMATION

PART III

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

EXECUTIVE COMPENSATION

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE

PRINCIPAL ACCOUNTING FEES AND SERVICES

PART IV

EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM
8­K

SIGNATURES
3

20
21

22

24

25
36
37
63
64
65

65
65
65

65
66

66
72

A WARNING ABOUT FORWARD­LOOKING STATEMENTS: This document contains "forward­looking
statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Forward­looking
statements address future events, developments and results. They include statements preceded by, followed by or
including words such as "believe," "anticipate," "expect," "intend," "plan," "view," target or "estimate." For
example, our forward­looking statements include statements regarding:

the timing of the regulatory approvals and closing of the proposed acquisition of Family Dollar Stores,
Inc. ("Family Dollar");

the consideration to be paid to the Family Dollar shareholders in the proposed acquisition and the
number of outstanding Family Dollar shares of common stock at closing;

acquisition­related expenses and financing
costs;

the benefits, results and effects of the proposed Family Dollar acquisition and the combined companys
plans, objectives, expectations (financial or otherwise), including synergies, the cost to achieve
synergies, and the effect on earnings per share;

the outcome and costs of pending or potential litigation or governmental investigations against either us
or Family Dollar;

regulatory approvals and expected store divestitures in connection with the proposed Family Dollar
acquisition;

the inability to retain key personnel at Family
Dollar;

our anticipated sales, including comparable store net sales, net sales growth and earnings
growth;

costs of pending and possible future legal
claims;

our growth plans, including our plans to add, expand or relocate stores, our anticipated square footage
increase, and our ability to renew leases at existing store locations;

the average size of our stores to be added in 2015 and beyond;

the effect on merchandise mix of consumables and the increase in the number of our stores with freezers

and coolers on gross profit margin and sales;

the net sales per square foot, net sales and operating income of our
stores;

the potential effect of inflation and other economic changes on our costs and profitability, including the
potential effect of future changes in minimum wage rates, shipping rates, domestic and import freight
costs, fuel costs and wage and benefit costs;

our gross profit margin, earnings, inventory levels and ability to leverage selling, general and
administrative and other fixed costs;

our seasonal sales patterns including those relating to the length of the holiday selling
seasons;

the capabilities of our inventory supply chain technology and other
systems;

the reliability of, and cost associated with, our sources of supply, particularly imported goods such as
those sourced from China;

the capacity, performance and cost of our distribution
centers;

our cash needs, including our ability to fund our future capital expenditures and working capital
requirements;

our expectations regarding competition and growth in our retail sector;
and

management’s estimates associated with our critical accounting policies, including inventory valuation,
accrued expenses and income taxes.

For a discussion of the risks, uncertainties and assumptions that could affect our future events, developments or
results, you should carefully review the risk factors described in Item 1A Risk Factors beginning on page 10, as
well as Item 7 "Managements Discussion and Analysis of Financial Condition and Results of Operations"
beginning on page 25 of this Form 10­K.
Our forward­looking statements could be wrong in light of these risks, uncertainties and assumptions. The
future events, developments or results described in this report could turn out to be materially different. We have no
obligation to publicly update or revise our forward­looking statements after the date of this annual report and you
should not expect us to do so.

Investors should also be aware that while we do, from time to time, communicate with securities analysts and
others, it is against our policy to selectively disclose to them any material, nonpublic information or other
confidential commercial information. Accordingly, shareholders should not assume that we agree with any
statement or report issued by any securities analyst regardless of the content of the statement or report as we have a
policy against confirming information issued by others. Thus, to the extent that reports issued by securities analysts
contain any projections, forecasts or opinions, such reports are not our responsibility.
INTRODUCTORY NOTE: Unless otherwise stated, references to "we," "our" and "Dollar Tree" generally refer to
Dollar Tree, Inc. and its direct and indirect subsidiaries on a consolidated basis. Unless specifically indicated
otherwise, any references to
4

2015 or fiscal 2015 , 2014 or fiscal 2014 , 2013 or fiscal 2013 , and 2012 or fiscal 2012 , relate
to as of or for the years ended January 30, 2016, January 31, 2015 , February 1, 2014 and February 2, 2013 ,
respectively.
AVAILABLE INFORMATION
Our annual reports on Form 10­K, quarterly reports on Form 10­Q, current reports on Form 8­K and
amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act are
available free of charge on our website at www.dollartree.com as soon as reasonably practicable after electronic
filing of such reports with the SEC.
5

PART I
Item 1. BUSINESS
Overview
We are the leading operator of discount variety stores offering merchandise at the fixed price of $1.00. We
believe the variety and value of products we sell for $1.00 sets us apart from our competitors. At January 31, 2015 ,
we operated 5,367 discount variety retail stores. Our stores operate under the names of Dollar Tree, Deals, Dollar
Tree Deals, Dollar Tree Canada, Dollar Giant and Dollar Bills. In 5,148 of these stores, we sell substantially all
items for $1.00 or less in the United States and $1.25(CAD) or less in Canada. In substantially all of the remaining
stores, operating as Deals or Dollar Tree Deals, we sell items for $1.00 or less but also sell items for more than
$1.00.
We believe our optimal store size is between 8,000 and 10,000 selling square feet. This store size provides the
appropriate amount of space for our broad merchandise offerings while allowing us to provide ease of shopping to
our customers. As we have been expanding our merchandise offerings, we have added freezers and coolers to
approximately 3,620 stores to increase sales and shopping frequency. At January 29, 2011, we operated 4,101 stores
in the United States and Canada. At January 31, 2015 , we operated 5,157 stores in 48 states and the District of
Columbia, as well as 210 stores in Canada. Our revenue and assets in Canada are not material. Our selling square

footage increased from approximately 35.1 million square feet in January 2011 to 46.5 million square feet in January
2015 . Our store growth has resulted primarily from opening new stores.
Business Strategy
Value Merchandise Offering . We strive to exceed our customers’ expectations of the variety and quality of
products that they can purchase for $1.00 by offering items that we believe typically sell for higher prices
elsewhere. We buy approximately 59% to 61% of our merchandise domestically and import the remaining 39% to
41% . Our domestic purchases include basic, seasonal, closeouts and promotional merchandise. We believe our mix
of imported and domestic merchandise affords our buyers flexibility that allows them to consistently exceed the
customer’s expectations. In addition, direct relationships with manufacturers permit us to select from a broad range
of products and customize packaging, product sizes and package quantities that meet our customers’ needs.
Mix of Basic Variety and Seasonal Merchandise. We maintain a balanced selection of products within
traditional variety store categories. We offer a wide selection of everyday basic products and we supplement these
basic, everyday items with seasonal, closeout and promotional merchandise. We attempt to keep certain basic
consumable merchandise in our stores continuously to establish our stores as a destination and increase the traffic in
our stores. Closeout and promotional merchandise is purchased opportunistically and represents less than 10% of
our purchases.
Our merchandise mix consists of:

consumable merchandise, which includes candy and food, health and beauty care, and everyday
consumables such as paper and chemicals, and in select stores, frozen and refrigerated food;

variety merchandise, which includes toys, durable housewares, gifts, party goods, greeting cards, softlines,
and other items; and

seasonal goods, which include, among others, Valentine’s Day, Easter, Halloween and Christmas
merchandise.

We added freezers and coolers to certain stores and increased the amount of consumable merchandise carried
by those stores. We believe this initiative helps drive additional transactions and allows us to appeal to a broader
demographic mix. We added freezers and coolers to 460 additional stores in 2014 . Therefore, as of January 31,
2015 , we have freezers and coolers in 3,620 of our stores. We plan to install them in 320 additional stores by the
end of fiscal 2015 .
The following table shows the percentage of net sales of each major product group for the years ended
January 31, 2015 and February 1, 2014 :

Merchandise Type
Consumable
Variety categories
Seasonal

January 31, February 1,
2015
2014

49.3 %
49.4 %
46.4 %
46.3 %
4.3 %
4.3 %

6

At any point in time, we carry approximately 6,800 items in our stores and as of the end of 2014 approximately
35% of our items are automatically replenished. The remaining items are pushed to the stores and a portion can be
reordered by our store managers on a weekly basis. Through automatic replenishment and our store managers
ability to order product, each store manager is able to satisfy the demands of his or her particular customer base.
Customer Payment Methods. All of our stores in the United States accept cash, checks, debit cards and credit
cards . Along with the rollout of freezers and coolers, we have increased the number of stores accepting Electronic
Benefits Transfer (EBT) cards and food stamps (under the Supplemental Nutrition Assistance Program (SNAP))
to approximately 5,000 stores as of January 31, 2015 .
Convenient Locations and Store Size. We primarily focus on opening new stores in strip shopping centers
anchored by large retailers who draw target customers we believe to be similar to ours. Our stores are successful in
metropolitan areas, mid­sized cities and small towns. The range of our store sizes allows us to target a particular
location with a store that best suits that market and takes advantage of available real estate opportunities. Our stores
are attractively designed and create an inviting atmosphere for shoppers by using bright lighting, vibrant colors and
decorative signs. We enhance the store design with attractive merchandise displays. We believe this design attracts
new and repeat customers and enhances our image as both a destination and impulse purchase store.
For more information on retail locations and retail store leases, see Item 2 "Properties beginning on page 19 of
this Form 10­K.
Profitable Stores with Strong Cash Flow. We maintain a disciplined, cost­sensitive approach to store site
selection in order to minimize the initial capital investment required and maximize our potential to generate high
operating margins and strong cash flows. We believe that our stores have a relatively small shopping radius, which
allows us to profitably concentrate multiple stores within a single market. Our ability to open new stores is
dependent upon, among other factors, locating suitable sites and negotiating favorable lease terms.
The strong cash flows generated by our stores allow us to self­fund infrastructure investment and new
stores. Over the past five years, cash flows from operating activities have exceeded capital expenditures.
For more information on our results of operations, see Item 7 "Management’s Discussion and Analysis of
Financial Condition and Results of Operations beginning on page 25 of this Form 10­K.
Cost Control . We believe that our substantial buying power and our flexibility in making sourcing decisions
contributes to our successful purchasing strategy, which includes targeted merchandise margin goals by
category. We also believe our ability to select quality merchandise helps to minimize markdowns. We buy products
on an order­by­order basis and have no material long­term purchase contracts or other assurances of continued
product supply or guaranteed product cost. No vendor accounted for more than 10% of total merchandise purchased
in any of the past five years.
Our supply chain systems continue to provide us with valuable sales information to assist our buyers and
improve merchandise allocation to our stores. Controlling our inventory levels has resulted in more efficient
distribution and store operations.
Information Systems. We believe that investments in technology help us to increase sales and control
costs. Our inventory management system has allowed us to improve the efficiency of our supply chain, improve
merchandise flow, increase inventory turnover and control distribution and store operating costs. It is also used to
provide information to calculate our estimate of inventory cost under the retail inventory method, which is widely

used in the retail industry. Our automatic replenishment system replenishes key items, based on actual store level
sales and inventory. At the end of 2014 , approximately 35% of our items are on automatic replenishment.
Point­of­sale data allows us to track sales and inventory by merchandise category at the store level and assists
us in planning for future purchases of inventory. We believe that this information allows us to ship the appropriate
product to stores at the quantities commensurate with selling patterns. Using this point­of­sale data to plan
purchases of inventory has helped us manage our inventory levels.
Corporate Culture and Values. We believe that honesty and integrity, doing the right things for the right
reasons, and treating people fairly and with respect are core values within our corporate culture. We believe that
running a business, and certainly a public company, carries with it a responsibility to be above reproach when
making operational and financial decisions. Our executive management team visits and shops our stores like every
customer, and ideas and individual creativity on the part of our associates are encouraged, particularly from our
store managers who know their stores and their customers. We have standards for store displays, merchandise
presentation, and store operations. We maintain an open door
7

policy for all associates. Our distribution centers are operated based on objective measures of performance and
virtually everyone in our store support center is available to assist associates in the stores and distribution centers.
Our disclosure committee meets at least quarterly and monitors our internal controls over financial reporting to
ensure that our public filings contain discussions about the risks our business faces. We believe that we have the
controls in place to be able to certify our financial statements. Additionally, we have complied with the listing
requirements for the Nasdaq Stock Market.
Seasonality. For information on the impact of seasonality, see Item 1A. "Risk Factors" beginning on page 10 of
this Form 10­K and Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of
Operations" beginning on page 25 of this Form 10­K.
Growth Strategy
Store Openings and Square Footage Growth. The primary factors contributing to our net sales growth have
been new store openings, an active store expansion and remodel program, and selective mergers and acquisitions. In
the last five years, net sales increased at a compound annual growth rate of 10.0% . We expect that the majority of
our future sales growth will come primarily from new store openings and from our store expansion and relocation
program.
The following table shows the average selling square footage of our stores and the selling square footage per
new store opened over the last five years. Our growth and productivity statistics are reported based on selling
square footage because our management believes the use of selling square footage yields a more accurate measure
of store productivity.

Year
2010
2011
2012

Number of Stores
4,101
4,351
4,671

Average Selling Square
Footage Per Store
8,570
8,640
8,660

Average Selling Square
Footage Per New Store
Opened
8,400
8,360
8,060

2013
2014

4,992
5,367

8,660
8,660

8,020
8,060

We expect to increase the selling square footage in our Dollar Tree stores in the future by opening new stores in
underserved markets and strategically increasing our presence in our existing markets via new store openings and
store expansions (expansions include store relocations). In fiscal 2015 and beyond, we plan to predominantly open
Dollar Tree stores that are approximately 8,000 ­ 10,000 selling square feet and we believe this size allows us to
achieve our objectives in the markets in which we plan to expand. At January 31, 2015 , approximately 2,974 of our
stores, totaling 65% of our selling square footage, were 8,000 selling square feet or larger .
Our Deals stores, which offer an expanded assortment of merchandise including items that sell for more than
$1.00, provide us an opportunity to leverage our Dollar Tree infrastructure in different merchandise concepts,
including higher price points, without disrupting the single­price point model in our Dollar Tree stores. We
operated 219 Deals stores as of January 31, 2015 .
In addition to new store openings, we plan to continue our store expansion program to increase our net sales per
store and take advantage of market opportunities. We target stores for expansion based on the current sales per
selling square foot and changes in market opportunities. Stores targeted for expansion are generally less than 6,000
selling square feet in size. Store expansions generally increase the existing store size by approximately 2,750 selling
square feet.
Since 1995, we have added a total of 695 stores through several mergers and acquisitions. Our acquisition
strategy has been to target companies that have a similar single­price point concept that have shown success in
operations or companies that provide a strategic advantage. We evaluate potential acquisition opportunities as they
become available. On July 27, 2014, we executed an Agreement and Plan of Merger to acquire Family Dollar Stores,
Inc. For more information regarding the pending acquisition, see "Family Dollar Acquisition" below and Item 8.
"Financial Statements and Supplementary Data…

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