Discount Retail Chain Penny Market Italia (owned by German REWE Group) has launched a pilot test of its home delivery service in Milan and Catania. An assortment of 2,000 SKUs is available on the dedicated website 'Pennycasa', with home delivery fulfilled by zero-emission electric vehicles. The move into online grocery had been mooted by the brand last year, but the COVID-19 emergency boosted the soft discounter's willingness to activate a simple and immediate home delivery service at the service of its customers. The delivery service has been developed together with e-commerce company ReStore, whose platform is used by about 30% of the online grocery market in Italy. As part of the service, ReStore will also be responsible for picking and delivery services for Penny Market Italia. For ReStore, this will be the first partnership with a discount store. Delivery is free of charge if a customer's online shopping basket totals more than €50. Part of Germany’s Rewe Group, Penny Market Italia is one of the few discount stores in Italy offering a home delivery service. Its chain has 385 stores across the country. See here for more: https://www.esmmagazine.com/technology/penny-market-launches-home-delivery-service-italy-112376?mkt_tok=eyJpIjoiWWpZd05qWTJPRGd4TnpBdyIsInQiOiJyQjVvV0lYQ0FITmk1MDRHWWV4d0VId1R5eVdZNUZtcHc5K2I1aDByVlBaSHdCMDM3VXBEbjVXOHZyeFdSZjlOOWJnYzZ5MVJLcDR3ZWF0TWdBZXgwbnRGdTZaUHd1bkVoelJIdFY1bjBRbmZjYVl2XC9qK1J6M2ExaUdEK2lrcUIifQ%3D%3D

Discount Retail Chain Biedronka (owned by Jeronimo Martins, listed Euronext: JMT) third quarter revenues, in the local currency, increased by 9.3%, and the comparable sales were higher by 6%. Revenues expressed in euro increased by 6.4%. up to EUR 3.4 billion (US$4bn), mother company Jeronimo Martins said in its financial quarterly report. The report stated that Biedronka wants to expand the chain by about 100 facilities this year, if the conditions in the construction sector allow it. By the end of September, the company opened 52 new stores (an increase by 45 net) and modernized 167 locations. At the end of September, the chain consisted of 3,047 discounters, 115 more than in the previous year, and the total retail area of ​​these facilities was 2,064 million square meters. During the three quarters of 2020, capital expenditure on the Biedronka network decreased to EUR 141 million (US$165mn), compared to EUR 221 million (US$258mn) a year earlier. Jeronimo Martins said in a statement that the group's total investment expenditure in 2020 is expected to amount to approx. EUR 450 million (US$525 mn, after three quarters, it amounted to EUR 258 ​​million). The entire Jeronimo Martins group generated a net profit of EUR 115 million (US$134 mio)in the third quarter, up 11.2 percent more than a year ago. Revenues increased by 2.7% during this period up to EUR 4.88 billion (US$ 5.7bn). The company's EBITDA amounted to EUR 395 million (US$461mn), which means an increase of 3.3% compared to last year. In the three quarters of this year, the group's EBITDA decreased by 1.9%. year on year to EUR 1.03 billion (US$1.2bn) with revenues at the level of EUR 14.2 billion (US$16.6bn, an increase of 3.9%). The parent company's net profit amounted to EUR 219 million (US$256mn, down 17.8%). The group's management board recommended EUR 86.7mn (US$101mn), or EUR 0.138 (US$0.16) per share, to shareholders on Wednesday. The decision on the payment is to be made at the general meeting on November 26. Together with the payment of EUR 130.1 million (US$152mn) in July, 50 percent of the total is to be paid to shareholders. group profit for 2019. See here for more: https://www.dlahandlu.pl/wiadomosci/,92353.html

German discount retail chain Lidl (owned by Schwarz Gruppe) opened als first discounter globally and as first supermarket retailer in Europe its first full operational, approved and external audited Net-Zero emission store, at 2,057m² [22,141ft²] in September 2019 in Woerden, the Netherlands, on the site of its old demolished shop. An important requirement from Lidl in the planning process for this store was to create an energy-neutral building, meaning that the power consumption of the whole building had to be fully self-sufficient and that no energy bills should be paid at any time during the year. All energy that is used in the store, such as for lighting, heating and cooling, the cashier tills and more, is therefore produced in the store itself from green energy sources, including 1,766 rooftop solar panels as well as thermal energy via a ground-source heat pump. The Woerden store, like most of Lidl’s new stores, cuts its energy demand with LED lighting and efficient HVAC&R systems, and includes other environmentally friendly features like rainwater filtration. The Woerden store is particularly innovative with HVAC&R technology, using two transcritical CO2 systems – a refrigeration system, and the ground-source heat pump, which is also used as a chiller for air conditioning. Lidl opened its first store in the Netherlands in 1997, and since 2014 all new stores in the country have been awarded the A++++ energy rating, the highest possible. Leveraging pre-cast concrete piles. One of the key energy-saving technologies at the Woerden net-zero store is the (50kW/14.2TR) transcritical CO2 ground-source heat pump provided by Dutch installer Frimex. The heat pump is connected to special pre-cast concrete piles in the ground underneath the store and the parking lot, which serve as a thermal reservoir. Glycol is circulated via hollow tubes inside these thermal precast piles to transport heat to and from the thermal reservoir, taking advantage of the natural ground temperature during the year to complement the cooling and heating cycle in the building. The heat pump can be used to create a comfortable climate inside the store when the refrigeration system doesn’t produce enough excess heat to heat the shop through heat recovery during the winter months. Conversely, the heat pump can also serve as an airconditioning system during the summer by reversing its operation, using the cooler ground temperatures. Hot and chilled water tanks are used for climate control of the store. A beneft of the system is that, as a result of pumping excess heat back into the thermal reservoir (via glycol), the refrigeration system’s CO2 refrigerant is cooled, increasing the efficiency of the system for the store/warehouse, and reducing the energy needs of the whole building. Marcel Ganzeboom, Senior Manager in the Construction Department of Lidl Netherlands, and the initiator is of the net-zero project, confirmed the retailer’s satisfaction with the technical solutions. “It is a very closed chain of electricity generation and waste streams from cold and heat, which are used immediately or stored immediately,” he said. “Very genius to see how it works.”The cooling power behind net-zero. The refrigerated cabinets in the new Woerden store are cooled by German manufacturer Teko’s ROXSTAsmart CO2 rack. The unit offers a medium-tempera-ture capacity of 112kW (32TR) at -8°C (17.6°F) and a low-temperature capacity of 4kW (1.2TR) at -33°C (-27.4°F). This is needed to cool a total of 85m (279ft) of medium-temperature cabinets in the sales area, plus two cold rooms and one freezer room. The ROXSTAsmart system was installed in a separate plant room above the warehouse, taking up minimal space. It only measures 2.6m by 1.9m by 0.98m (8.6ft by 6.2ft by 3.2ft), including a sound enclosure, three medium-temperature compressors, and one low-temperature compressor.In addition to aiming for net-zero emissions, Lidl required that no synthetic refrigerants be used, and Frimex opted for CO2. “By using CO2, even though it is a greenhouse gas as well, we designed a system with minimal impact on the environment,” said Hendrine Kalkman, Head Engineer at Frimex. While Lidl confirms that the invest-ment costs for the net-zero store were higher than an average supermarket, the expected payback time will be around 5 to 10 years. However, Lidl emphasizes that super-market customers should not pay a premium for the sake of shopping in a sustainable store like this. “We do not charge sustainability to the customer; it is the other way around – it makes the shopping cheaper, said Ganzeboom. See here for more:

German discount non-food retail chain KiK (owned by German Tengelmann Group) launched 12 new stores bringing the total to 350 stores in Poland. In KiK stores you can find "constantly low prices", and this is even more important nowadays than a few months ago, explains Adam Puk, expansion manager of KiK and adds: we did not intend to give up expansion activities, we just had to adapt them to the new circumstances. In practice, in Q3 we opened 12 new stores, which means that in Q3, on average, a new KiK store was opened once a week. KiK will open 3 stores in one day on October 29, Augustów, Głuchołazy and Skarżysko-Kamienna. In total, it opened 7 new stores in October and we plan to maintain a similar pace until the end of the year reports Marcin Ostrowski, expansion manager of the KiK chain of stores and announces: and we hope that the last months of this year will allow us to get closer to this result. There are at least a dozen KiK stores ahead of us. We will appear in other locations in Ełk, Łódź, Toruń, Warsaw and Nysa, we will also open the first KiK stores in Władysławowo, Nidzica and Barlinek. The KiK discount store chain has been present in Poland since 2012. In recent years, the pace of chain expansion has remained at the level of 50-60 new openings per year, and the current goal of KiK is to reach the number of 650 stores in Poland. By 2022, the company wants to have about 5,000 stores in Europe. See here for more: https://www.dlahandlu.pl/nonfood/aktualnym-celem-kik-jest-650-sklepow-w-polsce,92359.html?utm_source=gravitec&utm_medium=push&utm_campaign=

Russian Market leading grocery retailer X5 Retail Group (listed on the Moscow CX and London SE: FIVE) plans to open a Russian chain of hard discount stores under the Chizik brand name (meaning 'bird'), targeting to open 45-50 stores in 2021, the X5 Group’s Strategy Director Vladimir Salakhutdinov said. He was speaking at the Investor’s Day event. "Hard discount stores are stores with prices, which are lower than in conventional stores, with small sales area (creating high m2 turnovers) with minimum staff and minimum mostly own private label branded assortment covering the most common shopper needs.' The first store opend this week on Dolgoprudnaya Street in Moscow. Although we will open only a few pilot stores this year, we plan to develop the chain up to 45-50 stores next year," Salakhutdinov said. According to him, the store assortment will not exceed 800 unique SKUs. In the future, about 60% of the Chizhik assortment will be goods of its own private label brands, RBC reports. As Salakhutdinov noted, the quality of private labels will be at the level of the corresponding categories of other A-brands, but the cost will be 15% lower. "This will not be the case at the start, but in the future we will reach these figures. X5 plans to develop Chizhik to the scale of a federal retail network comparable in number of stores to Pyaterochka and Perekrestok, the company said. The stores are all small stores of 200-250 square meters," Salakhutdinov added. X5 Retail Group N.V. operates several retail formats: the chain of proximity soft discount stores under the Pyaterochka brand, a supermarket chain under the Perekrestok brand and the hypermarket chain under the Karusel brand. As of 30 September 2019, X5 had 15,752 company-operated stores. The company added 492 net new stores in Q3 2019. “Why Chizhik? We thought about how our new store should be, what our new brand should be. It is very important, because we make it for our customers, it should be friendly, positive and positive emotions forming. Chizhik is a fast and very friendly bird. And also "siskin" is an acronym for the words "black" and "yellow", and these are precisely the colors of the store format that we want to present," Salakhutdinov explained the name of the new chain. See here for more: https://x5.ru/en/Documents/X5_CMD_presentation_2020.pdf

Discount Non-Food Retail Chain Wibra (family owned) reopens all its 36 Wibra stores in Belgium. The cleaning category with the cult private label brand 'Dasty' has a starring role, and the retailer also has plans online. Growing again physically and online Last weekend, 12 Wibra stores opened their doors again, later this week the other of the 36 locations with which the non-food discounter in Belgium are relaunched. All shops were thoroughly refurbished and now have a uniform shop layout so that they are clearly recognizable as Wibra for the shopper. The shops have a fresher and sleeker style and are divided into clear "worlds": the mommy world, the baby world, the cleaning world… with beautiful back walls so that the shopper can orient himself more easily. “We will further optimize this in the coming weeks, this is what we were able to do for 36 stores in two weeks,” spokesman Maarten Hagg told Belgium retail newsplatform RetailDetail. Wibra had already adjusted the range before, as part of a broader strategic exercise, in which the retailer wants to better meet the changed needs of the customers. The company responds more closely to the seasons and now also makes more use of social media such as Facebook and Instagram. A lot of attention is paid to the cleaning world with the success private label brand 'Dasty'. “The cleaning line has grown considerably in recent years, we now want to place them more firmly in the shops. Dasty is a real magnet for our customers. In recent weeks, when our Belgian stores were closed, we have seen that many Dutch Wibra stores were overrun by Flemish customers looking for these products. ” The relaunch of Wibra in Belgium means also the start of a new growth story, says Hagg: “We first want to get those 36 stores profitable again as quickly as possible. The first signs are positive, we are getting enthusiastic reactions from customers, so we hope to get that done in a few months. Then we can look further at growth, that is certainly the ambition. ” The strategy will be twofold, the spokesperson said: both online and with physical stores. “We strongly believe in physical stores, but we also want to grow digitally. In the Netherlands, Wibra opened an online b2b shop for Dasty in May. We also want to roll them out to Belgium. That will be the start of an online strategy that we will further develop in both the Netherlands and Belgium. ” For “fashion bargain hunters” We put it to the test in the Wibra store in Laken (Belgium). The truck in front of the door has only one brand: Dasty. The sales cannot be kept up, district manager Carine Reynders confirms. "We have placed four pallets here and they are flying out the door." Dasty is the star of the store: the brand has a prominent presence next to the other cleaning products on the back wall, clearly visible from the entrance. The shopping route is now the same in all shops. It used to be different: then the shape of the building often determined the way in which the products were placed. “Now we have really chosen to work with a fixed plan for each store. This is just a start as we wanted to be able to reopen as soon as possible, but we will continue to build on this story. In the Netherlands there are already several Wibra stores that are further ahead in this area. They look really handsome. ” It is not a break in style, but Wibra wants to modernize and offer more trendy ranges, in categories such as home decoration or cooking and baking, for example. "In addition to our traditional budget shopper, we would like to appeal to the 'fashionable bargain hunter'." In any case, the store looks a lot clearer than before. The ranges are now on the shelves according to a clear logic. “In the past, clothing for children, women and men was often mixed up. Now we have separate worlds for baby, girls, boys, men and women. We have brought the leisure range to the fore in the stores, as well as the seasonal assortments, at the moment that is of course Christmas. Carine Reynders is enthusiastic: “We reopened the first 12 stores a bit tacitly on Saturday, because we did not want to create dangerous situations during these Corona times. But we have already received a lot of people and the reactions have been very positive. ” See here for more: https://www.retaildetail.nl/nl/news/algemeen/belgische-wibra-winkels-heropenen-met-opgefrist-concept

Discount Retail Chain Lidl (owned by Schwarz Gruppe) will employ 200 employees in its 12th distribution center. The 12th distribution center of the Lidl Polska chain is being built in Dobroszyce (Oleśnica district). The first works are scheduled for the spring of 2021, and the end of construction is scheduled for 2022. The new Lidl Polska distribution center in Dobroszyce will be one of the most modern facilities of this type in the chain's portfolio in Europe. The planned usable area of ​​the center is approximately 67,000 sq meter. Design works are currently underway, and the construction will start in spring 2021. Lidl's 12th distribution center will ultimately supply stores located mainly in the Dolnośląskie Voivodeship. 'We assume that the first deliveries will go to stores in the first half of 2022' announces Andrzej Porębski, member of the management board of Lidl Polska. Over 200 people will find work in the new distribution center of Lidl Polska. The chain plans to hire logistics specialists, forklift operators, controllers and logistics center employees. Recruitment will start at the beginning of 2021, the new team will undergo several months of training. Lidl Polska belongs to the international group of Lidl companies. Currently, there are approximately 11,200 stores of this brand in 30 countries, and over 700 stores in Poland. See here for more: https://www.dlahandlu.pl/wiadomosci/,92249.html

Discount Retail Chain Boxer Superstores (owned by South African Pick 'n Pay) has opened its fourth distribution centre, based out of Polokwane as it looks to increase the support for the increasing presence the soft discounter in both Limpopo and Mpumalanga.  The 15 000 sq metre centre is located in Koppiefontein and is a stone’s throw away from Polokwane International Airport. With 25 Boxer Superstores currently operating in Limpopo and 14 in Mpumalanga, the new distribution centre will play a key role in the direct supply and support of those stores and will welcome the future stores planned in those provinces.  Logistics Head of Department for Boxer’s Inland Division Sibusiso Dhladhla said the new centre was a key moment for Limpopo.  “The Opening of the Polokwane DC marks a key milestone for the Supply Chain which will enable Boxer to further expand in the Northern region. The opening comes at an interesting time as retail plans for the festive peak season. This means huge volumes, the benefit of having the stores in this region DC supplied will be massive and the frequency and service levels will ultimately benefit our end customer, the Boxer Superstore shopper, which is great,” he said.  The new distribution centre has created 225 jobs across a range of roles. In addition to the 10,000 storage locations and 2,200 pick faces, there are 18 outbound doors for loading and 6 inbound doors for receiving.   The Polokwane DC will exclusively use Lithium Ion batteries in its machinery. This translates to energy saving and reduced time needed to recharge as machinery requires only one battery for use and can be charged to full in 1.5 hours. Old lead acid batteries on the other hand required machinery to use 2 batteries, took up to 9 hours to charge and had to be taken out and removed from the machine each time. An array of world class safety and security measures feature throughout the centre including roof and in-rack sprinklers, hose reels, canisters, smoke detection systems, fire hydrants, Protection at rack ends and base protectors.  “We are proud of our newest addition to the Supply Chain stable and excited about the future of Boxer Superstores in Limpopo and Mpumalanga,” said Supply Chain Executive Justin Galloway at the official opening. See here for more: https://retailbriefafrica.co.za/boxer-expands-limpopo-reach-with-fourth-distribution-centre-opening-in-polokwane/

Discount Retail Chain Grocery Outlet (NASDAQ listed: GO), the fast-growing US West Coast discounter that has quietly maintained a small pocket of stores on the East Coast, looks poised to begin a significant move to expand the latter front, newsportal winsightgrocerybusiness (WGB) states. However, the company has made no secret of its desire to eventually expand in Pennsylvania, where it acquired the Amelia’s Grocery Outlet chain nearly a decade ago and has quietly rebranded it to the Grocery Outlet banner. Those stores—most in rural counties further out from metro Philadelphia—are supplied from a warehouse in Leola, Pa. in Lancaster Country. Grocery Outlet utilizes a unique model in which stores are typically owned and operated by independent entrepreneurs responsible for hiring and operations and who buy goods from the company to sell on consignment. Grocery Outlet’s buying teams focus on overruns, packaging changes and other non-traditional supply practices providing deeply discounted and rotating assortments drawing comparisons to the discount clothing retailer TJ Maxx. WGB reported last year that six of Grocery Outlet’s Pennsylvania stores were company owned. About a year ago, Grocery Outlet hired a former Boxed and Sam’s Club executive, Heather Mayo, as EVP of Grocery Outlet’s East division. At that time, company officials said Mayo would take a lengthy “immersion” in the company and its business with eyes on opening a second front of store expansion. Grocery Outlet’s expansion, if carried though, will represent another discount grocer vying for a slice of business in the Northeast which has seen rapid expansion from German-bred rivals Aldi and Lidl in recent years, which like Grocery Outlet are riding widening consumer acceptance of discount stores and what Grocery Outlet officials characterize as declining loyalty to traditional supermarkets and supercenters. Grocery Outlet had a successful public stock launch last year and has performed well during the pandemic, saying most recently that comps were up by 16.5% in its fiscal second quarter. Discount chains historically tend to do best in times of economic stress, which have also come along with the pandemic. US $52 Million Philadelphia ‘Linchpin’ In Philadelphia, Grocery Outlet was named as an anchor tenant in a $52 million mixed-use development planned for Philadelphia’s Sharswood neighborhood, according to the Philadelphia Housing Authority. The Sharswood Ridge development, which broke ground Oct. 14, is expected to bring 98 rental units—with nearly half to be offered at below-market rents—and more than 45,000 square feet of retail to Sharswood, a North Philadelphia neighborhood described as among the most distressed in the city. The project is to be developed by Mosaic Development Partners and SHIFT Capital and funded through federal, state and local authorities as well as private investors. The Philadelphia Housing Authority is the senior lender and partner in the project. That group said in a release that Grocery Outlet, along with Santander Bank and Wingstop restaurant, would be among the retail tenants. Construction is anticipated to begin this month. “This development will serve as a linchpin in the rebirth of the Sharswood neighborhood,” Philadelphia Mayor Jim Kenney. "It shows what we can achieve when government and private partners join together with a common purpose. It also shows the value of including community members in setting priorities for the services they feel are most important to them. Congratulations to PHA and all of its partners for making this day possible.” “This project checks so many boxes for our residents on issues magnified by the COVID-19 pandemic,” added Council President Darrell L. Clarke, whose district includes the site.  “A lack of access to healthy foods—we have a supermarket in this development. Check that box. Access to adequate health care—we have an urgent care coming here. Box checked. Access to banking—a new bank is locating here. Check that box. More affordable housing for seniors. Check the box. Businesses which are minority-owned gaining economic opportunity. A black developer is developing this project. This project checks every box we want and need in North Philadelphia. I cannot wait to get shovels in the ground.” See here for more: https://www.winsightgrocerybusiness.com/retailers/grocery-outlet-readies-east-coast-invasion?

Discount Retail Chain Aldi has opened its 900th UK store as part of a major investment to add capacity to its distribution network and keep pace with rising consumer demand. The discounter has pledged to invest £1.3 billion (US$ 1.7Bn) in Britain over the next two years, including adding capacity to its store and distribution network. On average, the retailer is currently opening one store a week, with plans to operate 1,200 UK stores by 2025. The company said it would create around 4,000 jobs in the UK next year to support its continued store growth. The milestone 900th store opened its doors in Sandhurst, Berkshire on 22 October and is the town’s first Aldi. The Sandhurst store represents one of more than 75 sites that Aldi now has in the South East, as it continues to attract new customers across the region. Other places to receive their first Aldi store in 2020 – the supermarket’s 30th anniversary year in the UK – include Plympton, Holyhead and Market Drayton. This year, new stores have also been added in Hertford, St Ives and Cambridge among other locations. Aldi opened its first UK store in Stechford, Birmingham back in 1990. John Richardson, Aldi UK’s regional managing director, said: “Opening our 900th store means that, after years of careful investment in our UK store network, we’re another step forward in making Aldi available to as many shoppers as possible, which is more important than ever before as many household budgets become squeezed. “Our 1,000th store is now firmly in sight and we’re on track to meet our target of operating 1,200 stores in the UK in five years time.” See here for more: http://www.fruitnet.com/fpj/article/183315/aldi-opens-900th-uk-store-amid-major-expansion

Discount Retail Chain Aldi Süd takes a large number of products out of its assortment range. Over 100 stores have already been informed that almost 100 products that are having low turnovers will be removed from the assortment range. This also includes certain packaging sizes for kitchen rolls and toilet paper, as well as certain juices and mineral water. Why is Aldi Süd delisting? According to German internet portal CHIP, most beverages and groceries did not meet the required sales targets. The national Aqua Plus mineral water with fruit flavor from Aldi's own Private Label brand 'Aqua Culinaris' turned out to be a slow seller. Aldi's own Private Label brand iced tea is also being thrown out. Further the procurement cooperation with Aldi Nord makes it necessary for Aldi Süd to make clear and rigid choices consequently delisting SKUs. For the paper category, small packaging for toilet paper and kitchen rolls are replaced by more popular 'mass packs' due to the current COVID situation. Here the two-roll kitchenpaper of Aldi's own Private Label brand 'Kokett', is replaced by a 4 pack. When it comes to toilet paper, Aldi will keep the 8x150 sheets. Some supermarkets and discounters had already confirmed that the demand for toilet paper and kitchen rolls was picking up again massively because of the second COVID wave. "Of course there will be no out-of-stocks and we will continue to offer sufficient good in the paper category in the future, but now only in larger packaging units," says Aldi Süd about the delisting of kitchen rolls and toilet paper. Discount stores and supermarkets regularly adjust their assortment range. Whether an product SKU is accepted or not to end up in the standard assortment range. In the past, Aldi Süd had invested heavily in new drinks, sweets and products from the refrigerated convenience counter. The discounter has continuously expanded its assortment range for years. In some store Aldi Süd is now also testing to sell magazines and newspapers analog Aldi Nord and Lidl. See here for more: https://www.chip.de/news/Auch-Mineralwasser-und-Toilettenpapier-dabei-Aldi-nimmt-Produkte-aus-dem-Sortiment_183066154.html

By: Trefis TeamContributor and Great SpeculationsContributor Group Discount Non-food Retail Chain Dollar Tree’s stock (listed on the NASDAQ: DLTR) is up only slightly to around US$95 levels year-to-date, compared to a 6% growth for the broader S&P 500. While Dollar Tree has underperformed the broader markets, we believe it has the potential to grow. This is taking into account the 9% year-over-year (y-o-y) growth in the retailer’s revenues so far in 2020. Dollar Tree, which also owns Family Dollar, specializes in selling $1 items like toys, books, party supplies, and general discount items. We believe the company could continue to benefit from the recessionary environment given that the demand for inexpensive household products will likely remain strong in the coming quarters (which is already helping the struggling Family Dollar store). Dollar Tree’s stock declined by around 12% since the end of 2017. Dollar Tree’s stock lost around 12% over the past two years, primarily due to a 52% decline in earnings, partially offset by modest revenue growth of 6%. An almost 55% fall in net income margin from 7.7% in 2017 to 3.5% in 2019, led to the decline in earnings per share. A global helium shortage, higher freight and distribution costs, and higher sales of low-margin goods weighed on the company’s profits during this period. Dollar Tree has been amidst a years-long restructuring following its 2015 acquisition of Family Dollar. The company has invested significantly in renovating Family Dollar stores. In fact, the acquired Family Dollar stores have been a drag on the business overall, turning a retailer with a low teens percentage operating margin into a mid-single-digit one. Dollar Tree’s P/E multiple grew from 15x at the end of 2017 to 27x by the end of 2019. It is still at the 2019 levels. But we believe DLTR’s multiple will likely grow slightly from 27x levels on the back of its turnaround strategy. This includes the company’s aggressive expansion of new stores. For 2020, the retailer with more than 15,000 stores plans to open another 500 new stores, including 325 Dollar Tree locations and 175 Family Dollar locations. Here Dollar Tree is in a tight competition with Dollar General (listed on the NYSE: 7DG), which is at the moment outperforming Dollar Tree. How Is Coronavirus Impacting Dollar Tree’s Stock? Covid-19 has proved to be a tailwind for Dollar Tree’s and other global food and non-food discount businesses. In the recent Q2, Dollar Tree's company-wide same-store sales rose 7.2%, with an 11.6% gain at Family Dollar (as these stores tend to focus more on essentials). In addition, earnings per share grew 45% year-over-year to $1.10, driven by lower merchandise costs, same-store sales leverage, and fewer markdowns. Although the company drew $500 million from its revolving credit line to manage its cash flows, it has $1.75 billion in cash and equivalents - more than sufficient to cover one quarter’s worth of cash operating expenses. Overall, Dollar Tree should likely enjoy higher traffic as consumers seek out value, convenience, and savings while shopping during the ongoing economic uncertainty. The actual recovery and its timing hinge on the broader containment of the coronavirus spread. Trends in U.S. Covid-19 Cases provides an overview of how the pandemic has been spreading in the U.S. and contrasts with trends in Brazil and Russia. Following the Fed stimulus — which set a floor on fear — the market has been willing to “look through” the current weak period and take a longer-term view. With investors focusing their attention on 2021 results, the valuations become important in finding value. Though market sentiment can be fickle, and evidence of an uptick in new cases could spook investors once again. See here for more: https://www.forbes.com/sites/greatspeculations/2020/10/23/dollar-tree-stock-looks-attractive-at-95/#7652bc807ff3