In an update on its operations amid the COVID-19 pandemic, Dollar Tree (NASDAQ:DLTR) announced generally strong sales through March that were nonetheless impacted by a dramatic demand slump for seasonal Easter merchandise.
The value retailer said on Tuesday that demand has been "unprecedented" for things like cleaning supplies, paper goods, sanitizers, food, and over-the-counter medicine. This spike pushed sales higher by 7% in its Dollar Tree locations and by 14% at Family Dollar as shoppers stocked up on essentials through most of March.
Trends turned sharply lower at the Dollar Tree brand in the past week, though, falling 19% as the traditional Easter season shopping lift never materialized.
Executives cited significant uncertainty around short-term sales trends, which will depend on government shelter-in-place orders and on the chain's ability to restock high-demand essentials. As a result, Dollar Tree withdrew its 2020 outlook.
The company has a flexible financial position, with $1.9 billion of cash on hand following the drawing down of its entire $750 million credit line. Still, Dollar Tree is suspending stock buybacks while focusing on paying wage premiums to its 190,000 employees who are helping deliver essential supplies to consumers all around North America.