Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended February 28, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-6807
FAMILY DOLLAR STORES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 56-0942963
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P. O. Box 1017, 10401 Old Monroe Road
Charlotte, North Carolina 28201-1017
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 704-847-6961
Indicate by check mark whether the registrant (1) has filed all re-
ports 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 the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at March 31, 1995
Common Stock, $.10 par value 56,715,932 shares
<PAGE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
INDEX
Page No.
Part I - Financial Information
Item I - Financial Statements:
Consolidated Condensed Balance Sheets -
February 28, 1995 and August 31, 1994 2
Consolidated Condensed Statements of Income -
Three Months Ended February 28, 1995 and 1994 3
Consolidated Condensed Statements of Income -
Six Months Ended February 28, 1995 and 1994 4
Consolidated Condensed Statements of Cash Flows -
Six Months Ended February 28, 1995 and 1994 5
Notes to Consolidated Condensed Financial
Statements 6-7
Computation of Earnings per Common Share -
Note 8 7
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8-10
Part II - Other Information and Signatures
Item 4 - Submission of Matters to a Vote of Security
Holders 11
Item 6 - Exhibits and Reports on Form 8-K 11
Signatures 11
<PAGE>
<TABLE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
<CAPTION>
February 28, August 31,
1995 1994
Assets
<S> <C> <C>
Current assets:
Cash and cash equivalents (Note 2) $ 30,629,145 $ 9,882,533
Merchandise inventories 388,268,741 403,570,733
Deferred income taxes (Note 3) 14,711,213 12,991,213
Income tax refund receivable - 4,569,686
Prepayments and other current assets 5,184,288 4,853,416
Total current assets 438,793,387 435,867,581
Property and equipment, net 155,335,117 151,946,323
Other assets 4,685,915 5,007,967
$598,814,419 $592,821,871
<PAGE>
<CAPTION>
Liabilities and Shareholders' Equity
<S> <C> <C>
Current liabilities:
Notes payable (Note 4) $ - $ 12,300,000
Accounts payable and accrued
liabilities 185,077,347 193,332,807
Income taxes 3,397,396 -
Total current liabilities 188,474,743 205,632,807
Deferred income taxes (Note 3) 17,016,789 17,016,789
Contingencies (Note 5)
Shareholders' equity (Notes 6 and 8):
Preferred stock, $1 par; authorized
and unissued 500,000 shares
Common stock, $.10 par;
authorized 120,000,000 shares;
issued 60,167,764 shares at
February 28, 1995 and 60,039,074
shares at August 31, 1994 6,016,776 6,003,907
Capital in excess of par 15,486,029 14,484,153
Retained earnings 383,169,350 361,033,483
404,672,155 381,521,543
Less common stock held in treasury,
at cost (3,452,822 shares at
February 28, 1995 and August 31, 1994-
Note 8) 11,349,268 11,349,268
Total shareholders' equity 393,322,887 370,172,275
$598,814,419 $592,821,871
See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>
<TABLE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
Three Months Ended
February 28, February 28,
1995 1994
<S> <C> <C>
Net sales $420,926,957 $398,767,654
Costs and expenses:
Cost of sales 288,458,588 262,176,004
Selling, general and
administrative expenses
(Note 7) 104,594,181 100,843,512
393,052,769 363,019,516
Income before provision
for taxes on income 27,874,188 35,748,138
Provision for taxes on income 10,834,000 13,727,000
Net income $ 17,040,188 $ 22,021,138
Net income per common share
(Note 8) $0.30 $0.39
Dividends per common share $0.10 $0.085
Weighted average number of
common shares outstanding (Note 8) 56,691,422 56,478,855
See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>
<TABLE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
Six Months Ended
February 28, February 28,
1995 1994
<S> <C> <C>
Net sales $777,219,156 $733,859,402
Costs and expenses:
Cost of sales 517,399,762 471,319,829
Selling, general and
administrative expenses (Note 7) 206,478,818 202,502,716
723,878,580 673,822,545
Income before income taxes and
cumulative effect of accounting
change 53,340,576 60,036,857
Income taxes 20,714,000 23,066,000
Income before cumulative effect
of accounting change 32,626,576 36,970,857
Cumulative effect of change in method
of accounting for income taxes (Note 3) - 1,139,153
Net income $ 32,626,576 $ 38,110,010
Earnings per common share (Note 8):
Income before cumulative effect
of accounting change $0.58 $0.66
Cumulative effect of change in method
of accounting for income taxes - .02
Net income $0.58 $0.68
Dividends per common share $0.185 $0.16
Weighted average number of
common shares outstanding (Note 8) 56,645,019 56,424,201
See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>
<TABLE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Six Months Ended
February 28, February 28,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $32,626,576 $38,110,010
Adjustments to reconcile net income to
net cash provided (used) by operating
activities:
Depreciation and amortization 10,866,908 9,308,564
Deferred income taxes (1,720,000) (1,441,153)
(Gain) Loss on disposition of property
and equipment 8,467 (107,463)
Changes in operating assets and liabilities:
Inventories 15,301,992 (11,163,451)
Income tax refund receivable 4,569,686 -
Prepayments and other current assets (330,872) 521,128
Other assets 322,052 (140,757)
Accounts payable and accrued
liabilities (9,117,109) (28,294,430)
Income taxes payable 3,397,396 6,112,588
Noncurrent income taxes payable - (672,026)
55,925,096 12,233,010
Cash flows from investing activities:
Capital expenditures (14,691,037) (20,833,531)
Proceeds from dispositions of
property and equipment 426,868 835,001
(14,264,169) (19,998,530)
Cash flows from financing activities:
Net notes payable (repayments) borrowings (12,300,000) 8,900,000
Exercise of employee stock options 1,014,745 1,641,866
Payment of dividends (9,629,060) (8,460,380)
(20,914,315) 2,081,486
Net change in cash and cash equivalents 20,746,612 (5,684,034)
Cash and cash equivalents at beginning
of period 9,882,533 5,684,034
Cash and cash equivalents at end of period $30,629,145 $ 0
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 519,738 $ 274,449
Income taxes 14,217,318 17,275,234
See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. In the opinion of the Company, the accompanying unaudited con-
solidated condensed financial statements contain all adjust-
ments (consisting of only normal recurring accruals) necessary
to present fairly the financial position as of February 28,
1995, and the results of operations for the three and six
months ended February 28, 1995, and 1994, and the cash flows
for the six months ended February 28, 1995, and 1994.
The results of operations for the six month period ended
February 28, 1995, are not necessarily indicative of the
results to be expected for the full year.
2. The Company considers all highly liquid investments with a
maturity of three months or less to be "cash equivalents."
3. Effective September 1, 1993, the Company adopted Statement of
Financial Accounting Standards No. 109, Accounting for Income
Taxes ("SFAS 109"). The cumulative effect as of September 1,
1993, of adopting SFAS 109 increased net income for the six
month period ended February 28, 1994, by approximately $1.1
million or $.02 per share.
Under SFAS 109, deferred income taxes arise principally from
the tax effect of temporary differences between financial
reporting and tax bases of property and equipment, merchandise
inventories, and accrued liabilities such as accrued insurance
costs and deferred incentive compensation.
4. The Company has two unsecured bank lines of credit for
short-term revolving borrowings of up to $50,000,000 each, or
$100,000,000 of total borrowing capacity. The lines of credit
expire on February 28, 1996 and February 13, 1996,
respectively. Borrowings under these lines of credit are at a
variable interest rate equal to the lower of the bank's prime
interest rate minus one-half percent or a rate based on
short-term market interest rates. The Company may convert up
to $50,000,000 of the line of credit expiring February 28,
1996, into either a five, seven, or nine year term loan, at
the bank's variable prime rate.
5. The Internal Revenue Service has examined the Company's
consolidated 1991 and 1992 federal income tax returns and has
rendered an initial report and assessment as a result of the
examination. The Company has appealed the findings of the
report. Although the ultimate outcome of this matter cannot
presently be determined, the Company believes that any impact
on its financial statements will not be material.
<PAGE>
6. The Company's non-qualified stock option plans provide for the
granting of options to key employees to purchase shares of
common stock at prices not less than the fair market value on
the date of grant. Options expire five years from the date of
grant and are exercisable to the extent of 40% after the
second anniversary of the grant and an additional 30% at each
of the following two anniversary dates on a cumulative basis.
All shares available for option as of February 28, 1995, were
issuable under the current plan which expires in November
1998, covering a maximum of 2,200,000 shares.
<TABLE>
The following is a summary of transactions under the plans
during the six months ended February 28, 1995 and 1994.
<CAPTION>
Six Months Ended
February 28, 1995 February 28, 1994
Number of Number of
shares Option price shares Option price
under option per share under option per share
<S> <C> <C> <C> <C>
Outstanding-beginning 951,290 $ 5.13-$21.25 1,120,510 $ 5.13-$21.25
Granted 345,350 $10.25-$13.00 214,800 $16.25-$16.75
Exercised (128,690) $ 5.13-$ 5.88 (156,860) $ 5.13-$16.63
Cancelled (50,110) (15,270)
Outstanding-ending 1,117,840 $ 5.88-$21.25 1,163,180 $ 5.13-$21.25
At February 28, 1995, options to purchase 387,020 shares were
exercisable at prices ranging from $5.88 to $21.25 per share, and at
February 28, 1994, options to purchase 403,630 shares were
exercisable at prices ranging from $5.13 to $16.63 per share.
</TABLE>
7. Interest expense for the six months ended February 28, 1995,
was $459,548 and for the six months ended February 28, 1994,
was $186,710. During the six months ended February 28, 1994,
$95,000 of interest was capitalized as part of the cost of
constructing a new distribution facility in West Memphis,
Arkansas.
8. Earnings per common share is based on the weighted average
number of shares outstanding during each reporting period.
Exercise of outstanding stock options would have no material
dilutive effect on earnings per common share.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
The Company's working capital increased by $20,083,870, from
$230,234,774 at August 31, 1994 to $250,318,644 at February 28, 1995.
The principal source of new working capital continued to be the reinvest-
ment of a significant portion of the earnings of the Company. The
decrease in merchandise inventories during the first six months of
fiscal 1995 compared with the increase during the first six months of
fiscal 1994 occurred, in part, because the Company purchased less
apparel merchandise in anticipation of continued weakness in the sales
of apparel. The Company also purchased lower price point apparel as
part of an overall price reduction program that began in the second
quarter of fiscal 1994 as the Company moved toward an everyday low price
strategy. This program was expanded at the start of fiscal 1995 from
approximately 1,000 stores to approximately 1,800 stores, and the number
of stockkeeping units with price reductions increased from approximately
500 to approximately 2,500. A lesser number of price reductions were
taken in the balance of the stores in less competitive markets.
Capital expenditures for the six months ended February 28, 1995,
were approximately $14,691,000, and are currently planned to be
approximately $25 million for fiscal 1995. The majority of capital
expenditures for fiscal 1995 is directly related to the Company's retail
store expansion program. In fiscal 1995, the Company plans to open at
least 205 stores and close approximately 15 stores for a net addition of
at least 190 stores, compared with the opening of 202 stores and closing
of 22 stores for a net addition of 180 stores in fiscal 1994.
Pursuant to agreements with Winn's Stores, Incorporated in July
1994, November 1994, and December 1994, subsidiaries of the Company
acquired the leases on 44 stores and purchased 11 stores from Winn's.
Fifty-three of the 55 stores are located in Texas and 2 are located in
New Mexico. The Company occupies most of its stores under operating
leases. New store opening and closing plans, as well as overall capital
expenditure plans, are continuously reviewed and are subject to change
depending on developments in the economy and other factors.
<PAGE>
RESULTS OF OPERATIONS
NET SALES
Net sales increased 5.6% in the quarter ended February 28, 1995, as
compared with the quarter ended February 28, 1994, and increased 5.9% in
the six month period ended February 28, 1995, as compared with the six
month period ended February 28, 1994. The increase was attributable to
sales from new stores opened as part of the Company's store expansion
program. Sales in existing stores decreased 3.5% in the quarter ended
February 28, 1995, as compared with the same period ended February 28,
1994, and decreased 3.0% in the six month period ended February 28,
1995. Sales of apparel continued to weaken in the six months ended
February 28, 1995. The Company purchased lower price point apparel as
part of its overall price reduction program. This merchandise did not
generate anticipated increases in unit movement, causing sales decreases
in softline departments. The Company is generally pleased with the
results of the price reduction program in hardlines but sales increases
in hardlines were more than offset by sales decreases in softlines.
The comparable store sales decrease for the six months ended
February 28, 1995, is also attributable to reduced advertising during
this period compared to the prior year. In connection with the
Company's shift in its merchandise strategy away from promotional
pricing and toward everyday low prices, the Company is reducing the
number of advertising circulars in fiscal 1995 from 22 to 15 and
eliminating all 7 advertising coupon booklets that were distributed in
fiscal 1994. Three advertising circulars and two coupon booklets were
eliminated in the first quarter of fiscal 1995, and two coupon booklets
were eliminated in the second quarter of fiscal 1995, as compared to the
first and second quarters of fiscal 1994, respectively.
The average number of stores open during the first six months of
fiscal 1995 was 9.5% more than during the first six months of fiscal
1994. The Company had 2,327 stores in operation at February 28, 1995,
as compared with 2,110 stores in operation at February 28, 1994,
representing an increase of approximately 10.3%.
COST OF SALES
Cost of sales increased 10.0% in the quarter ended February 28,
1995, as compared with the quarter ended February 28, 1994 and increased
9.8% in the six months ended February 28, 1995, as compared with the six
months ended February 28, 1994. This increase primarily reflected the
additional sales volume between years. Cost of sales, as a percentage
of net sales, was 68.5% in the quarter ended February 28, 1995, compared
with 65.7% in the quarter ended February 28, 1994, and was 66.6% in the
six months ended February 28, 1995, compared with 64.2% in the six
months ended February 28, 1994. The increases in the cost of sales
percentages for the quarter and six months ended February 28, 1995, were
due primarily to the merchandise price reductions that were taken as
part of the expansion of the price reduction program and shift toward an
everyday low price strategy. These price reductions are expected to
<PAGE>
continue to increase the cost of sales percentages for the third and
fourth quarters of fiscal 1995, as compared to the third and fourth
quarters of fiscal 1994. The reduction in sales of apparel, which
generally carries a higher margin than hardlines merchandise, as a
percentage of net sales also contributed to the increase in the cost of
sales percentages for the quarter and six months ended February 28,
1995. The cost of sales percentages also are affected by other changes
in the effectiveness of the merchandise procurement programs and product
mix, and also by merchandise shrinkage losses and freight costs.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses increased 3.7% in the
quarter ended February 28, 1995, as compared with the quarter ended
February 28, 1994, and 2.0% in the six months ended February 28, 1995,
as compared with the six months ended February 28, 1994. The increase
in these expenses was primarily attributable to additional costs arising
from the continued growth in the number of stores in operation.
Selling, general and administrative expenses, as a percentage of net
sales, were 24.8% in the quarter ended February 28, 1995, as compared
with 25.3% in the quarter ended February 28, 1994, and were 26.6% in the
six months ended February 28, 1995, as compared to 27.6% in the six
months ended February 28, 1994. The decrease in the percentage for the
quarter and six months ended February 28, 1995, was due to the reduction
in advertising, as described under the heading "Net Sales" above, and to
the Company's efforts to tightly control store operating costs and
corporate overhead expenses. The increased item sales movement
resulting from the merchandise price reduction program is expected to
continue to increase distribution expenses as the Company handles
additional units of lower priced merchandise.
PROVISION FOR TAXES ON INCOME
The provision for taxes on income for the quarter ended February
28, 1995, decreased 21.1% as compared with the quarter ended February
28, 1994, and for the six months ended February 28, 1995, decreased
10.2%, prior to the effect of adopting Statement of Financial Accounting
Standards (SFAS) No. 109 (described in Note 3 to the Consolidated
Condensed Financial Statements), as compared with the six months ended
February 28, 1994. The variance between the periods is primarily due to
the decrease in income before the provision for income taxes. The
effective tax rate was 38.9% for the quarter ended February 28, 1995, as
compared to 38.4% for the quarter ended February 28, 1994, and was 38.8%
for the six months ended February 28, 1994, as compared to 38.4% (prior
to the effect of the adoption of SFAS No. 109) for the six months ended
February 28, 1994. The increase in the effective rate resulted
primarily from increases in state income tax rates.
<PAGE>
PART II - OTHER INFORMATION
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Annual Meeting of Stockholders of the Company held on
January 19, 1995, stockholders voted to:
<TABLE>
<CAPTION>
(a) Elect to the Board of Directors of the Company the five
nominees named in the Proxy Statement for the Annual Meeting
as follows:
<S> <C> <C>
Shares Shares Withholding
Nominee Voting For Authority to Vote
Leon Levine 52,469,359 358,750
John D. Reier 52,439,118 388,991
George R. Mahoney, Jr. 52,471,359 356,750
Thomas R. Payne 52,556,180 271,929
Mark R. Bernstein 52,585,900 242,209
(b) Ratify the action of the Board of Directors in selecting Price
Waterhouse as independent accountants to audit the
consolidated financial statements of the Company and its
subsidiaries for the year ending August 31, 1995, with
52,696,966 shares voted for, 51,797 shares against and 79,346
shares abstaining.
</TABLE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits filed herewith:
11 Statement Re: Computations of Per Share Earnings
(b) Reports on Form 8-K - None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
FAMILY DOLLAR STORES, INC.
(Registrant)
Date: April 6, 1995 JOHN D. REIER
JOHN D. REIER
(President)
Date: April 6, 1995 C. MARTIN SOWERS
C. MARTIN SOWERS
(Senior Vice President-Finance)
Date: April 6, 1995 ROBYN W. CONNER
ROBYN W. CONNER
(Vice President-Controller
Principal Accounting Officer)
<TABLE>
<CAPTION>
FAMILY DOLLAR STORES, INC. EXHIBIT 11
STATEMENT RE COMPUTATIONS OF PER SHARE EARNINGS Page 1 of 2
THREE MONTHS ENDED THREE MONTHS ENDED
FEBRUARY 28, 1995 FEBRUARY 28, 1994
AS PRESENTED PRIMARY FULLY DILUTED PRIMARY FULLY DILUTED
<S> <C> <C> <C> <C>
AVERAGE SHARES OUTSTANDING FOR
THE THREE MONTHS ENDED 56,691,422 56,691,422 56,478,855 56,478,855
NET INCOME $17,040,188 $17,040,188 $22,021,138 $22,021,138
EARNINGS PER SHARE $ .30 $ .30 $ .39 $ .39
PRO FORMA DILUTION IMPACT OF COMMON STOCK EQUIVALENTS
ADDITIONAL WEIGHTED AVERAGE
SHARES FROM ASSUMED EXERCISE AT
THE BEGINNING OF THE YEAR OF
DILUTIVE STOCK OPTIONS 228,460 328,010 399,260 754,960
WEIGHTED AVERAGE SHARES ASSUMED
REPURCHASED FROM ASSUMED PROCEEDS
OF EXERCISES USING TREASURY STOCK
METHOD (AVERAGE MARKET PRICE FOR
PRIMARY AND, IF GREATER, ENDING
MARKET PRICE FOR FULLY DILUTED) (176,886) (269,381) (248,330) (603,375)
NET PRO FORMA COMMON STOCK
EQUIVALENT INCREMENTAL SHARES 51,574 58,629 150,930 151,585
PERCENTAGE DILUTION FROM PRO FORMA
COMMON STOCK EQUIVALENT
INCREMENTAL SHARES 0.09% 0.10% 0.27% 0.27%
TOTAL COMMON STOCK AND COMMON
STOCK EQUIVALENTS 56,742,996 56,750,051 56,629,785 56,630,440
NET INCOME $17,040,188 $17,040,188 $22,021,138 $22,021,138
PRO FORMA EARNINGS PER SHARE (INCLUDING
DILUTIVE COMMON STOCK EQUIVALENTS) $ .30 $ .30 $ .39 $ .39
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FAMILY DOLLAR STORES, INC. STATEMENT RE COMPUTATIONS OF PER SHARE EARNINGS EXHIBIT 11
Page 2 of 2
SIX MONTHS ENDED SIX MONTHS ENDED
AS PRESENTED FEBRUARY 28, 1995 FEBRUARY 28, 1994
PRIMARY FULLY DILUTED PRIMARY FULLY DILUTED
<S> <C> <C> <C> <C>
AVERAGE SHARES OUTSTANDING FOR THE
SIX MONTHS ENDED 56,645,019 56,645,019 56,424,201 56,424,201
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $32,626,576 $32,626,576 $36,970,857 $36,970,857
NET INCOME $32,626,576 $32,626,576 $38,110,010 $38,110,010
EARNINGS PER SHARE:
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $ .58 $ .58 $ .66 $ .66
NET INCOME $ .58 $ .58 $ .68 $ .68
PRO FORMA DILUTION IMPACT OF COMMON STOCK EQUIVALENTS
ADDITIONAL WEIGHTED AVERAGE SHARES FROM
ASSUMED EXERCISE AT THE BEGINNING
OF THE YEAR OF DILUTIVE STOCK OPTIONS 231,465 288,257 455,009 810,709
WEIGHTED AVERAGE SHARES ASSUMED REPURCHASED FROM
ASSUMED PROCEEDS OF EXERCISES USING TREASURY STOCK
METHOD (AVERAGE MARKET PRICE FOR PRIMARY AND, IF
GREATER, ENDING MARKET PRICE FOR FULLY DILUTED) (171,399) (218,323) (282,340) (637,788)
NET PRO FORMA COMMON STOCK
EQUIVALENT INCREMENTAL SHARES 60,066 69,934 172,669 172,921
PERCENTAGE DILUTION FROM PRO FORMA COMMON
STOCK EQUIVALENT INCREMENTAL SHARES 0.11% 0.12% 0.31% 0.31%
TOTAL COMMON STOCK AND COMMON
STOCK EQUIVALENTS 56,705,085 56,714,953 56,596,870 56,597,122
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $32,626,576 $32,626,576 $36,970,857 $36,970,857
NET INCOME $32,626,576 $32,626,576 $38,110,010 $38,110,010
PRO FORMA EARNINGS PER SHARE (INCLUDING DILUTIVE
COMMON STOCK EQUIVALENTS):
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $ .58 $ .58 $ .65 $ .65
NET INCOME $ .58 $ .58 $ .67 $ .67
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF FAMILY DOLLAR STORES, INC.
AND SUBSIDIARIES FOR THE SIX MONTHS ENDED FEBRUARY 28, 1995, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> AUG-31-1995
<PERIOD-START> SEP-01-1994
<PERIOD-END> FEB-28-1995
<EXCHANGE-RATE> 1
<CASH> 30,629,145
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 388,268,741
<CURRENT-ASSETS> 438,793,387
<PP&E> 272,965,738
<DEPRECIATION> 117,630,621
<TOTAL-ASSETS> 598,814,419
<CURRENT-LIABILITIES> 188,474,743
<BONDS> 0
<COMMON> 6,016,776
0
0
<OTHER-SE> 387,306,111
<TOTAL-LIABILITY-AND-EQUITY> 598,814,419
<SALES> 777,219,156
<TOTAL-REVENUES> 777,219,156
<CGS> 517,399,762
<TOTAL-COSTS> 723,878,580
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 53,340,576
<INCOME-TAX> 20,714,000
<INCOME-CONTINUING> 32,626,576
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 32,626,576
<EPS-PRIMARY> .30
<EPS-DILUTED> .30
</TABLE>
