Home Former Dollar General Chief Dreiling Made Dollar Tree Exec Chairman
March 22, 2022

Former Dollar General Chief Dreiling Made Dollar Tree Exec Chairman

Posted In: Retail Articles

Dollar Tree has entered into a Stewardship Framework Agreement with affiliates of investment firm Mantle Ridge LP that supports the appointment of former Dollar General chairman and CEO Richard Dreiling to the post of executive chairman.

On March 19, the retailer’s board of directors entered into a five-year employment agreement with Dreiling granting him an option to purchase approximately 2,253,000 shares of Dollar Tree common stock with a per-share exercise price of $157.17, the per-share closing trading price of Dollar Tree common stock on March 18.

Dollar Tree share price increased about 45.4% over the four-month period after publicly published reports of a Mantle Ridge investment in the retailer first surfaced late last year. The per-share Dollar Tree closing trading price was $108.07 on November 4, 2021, and $157.17 on March 18, the last trading day preceding the option grant date, the company stated.

The option award vests over five years and, with an annual base salary of $1 million, is the total direct compensation that Dreiling receives for his service as executive chairman, according to Dollar Tree. In particular. Dreiling won’t be eligible for annual or any other long-term incentive awards, and, so, the bulk of his compensation is aligned with shareholder interest, the company emphasized.

Prior to his appointment as Dollar Tree executive chairman, Dreiling was CEO of company rival Dollar General until 2015 and chairman until 2016, as well as a board member of Lowe’s Cos. among other corporations.

In recently announced fourth-quarter financial results, Dollar Tree consolidated net sales increased 4.6% to $7.08 billion in the period year over year as enterprise comparable sales increased 2.5%, up 3.1% at the Dollar Tree division and 1.7% at the Family Dollar division, the company reported. Operating income was $578.8 million versus $681.6 million in the year-prior period. Net income was $454.2 million, or $2.01 per diluted share, versus $502.8 million, or $2.13 per diluted share, in the year-earlier quarter. Dollar Tree beat a MarketBeat-published analyst consensus estimate of $1.79 per diluted share although it fell slightly short of a $7.12 billion revenue estimate.

For the full fiscal year, net sales increased 3.1% to $26.31 while operating income slipped to $1.81 billion versus $1.89 billion in the prior year and net income was $1.33 billion, or $5.80 per diluted share, versus $1.34 billion, or $5.65 per diluted share, in the annum earlier.

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