For the financial year's first quarter, Family Dollar Stores Inc.'s earnings managed to rise by 14%, going beyond the estimates pegged by analysts. The rise has been attributed to fewer markdowns for holiday season and lower freight costs, which boosted profitability.

For the month of December, same-store sales grew by 4%, and the rise has come after a 2.4% increase in the first quarter and on top of an increase of 6% which was recorded a year earlier. As per figures, the sales for the first quarter were strongest in basic and consumable products, but Chairman and Chief Executive Howard Levine said customers "clearly appreciated the great toys and gifts we offered this holiday season".

Shares of the company, which had declined by 10.9% since it posted disappointing sales for the first quarter on December 3, managed to rise in pre-market trading today by 8.6%.

"Given the fact that lower-margin consumables are still the fastest growing category for the company, this is a pretty good performance", RBC Capital Markets analyst Scot Ciccarelli said.

On the back of a strong first-quarter, Family Dollar is now looking forward to posting even better sales and earnings for the second quarter.