MATTHEWS, N.C.: Family Dollar plans to cut some jobs and close about 370 underperforming stores as it tries to reverse sagging sales and earnings. The discount store operator will also lower prices on about 1,000 basic items.
Family Dollar did not provide details on how many jobs were expected to be eliminated.
There was no immediate information about which stores are to be closed. The chain has 47 stores in the Akron-Canton area, including Wayne and Portage counties.
The chain said the store closings and job cuts should reduce annual operating expenses by $40 million to $45 million, starting with the fiscal third quarter. Family Dollar Stores Inc. currently has more than 8,100 stores in 46 states.
The job cuts and store closings are estimated to result in an approximately $85 million to $95 million restructuring charge during fiscal 2014’s second half.
The Matthews, N.C., company also said it will slow new store openings beginning in fiscal 2015 to bolster its return on investment. It now anticipates opening 350 to 400 new stores. In fiscal 2014 it had about 525 new stores.
The announcement came as Family Dollar reported its profit and revenue declined in the fiscal second quarter, which was hampered by bad winter weather.
Family Dollar reported that its net income dropped to $90.9 million, or 80 cents per share, from $140.1 million, or $1.21 per share, a year earlier. Revenue fell to $2.72 billion from $2.89 billion. Analysts surveyed by FactSet expected earnings of 90 cents per share on revenue of $2.77 billion.
Last year’s quarter included one extra week.
Sales at stores open at least a year, a key gauge of a retailer’s health, declined 3.8 percent.
Beacon Journal business writer Katie Byard contributed to this report.