Family Dollar ( FDO) shares were losing 1.6% on heavy volume Thursday afternoon after the discount retailer beat fiscal fourth-quarter earnings expectations, but offered more sobering projections for comparable-store sales growth.

For the fourth quarter, the Matthews, N.C.-based company said it earned $37.8 million, or 26 cents per diluted share, vs. $32.3 million, or 21 cents per diluted share, in the year-ago period. The retailer reported sales of $1.63 billion, compared to $1.58 billion in the last quarter of 2006. Analysts polled by Thomson Financial expected fourth-quarter earnings of 25 cents a share on revenue of $1.64 billion.

For the first quarter, however, the company expects comparable-store sales falling somewhere between flat and 2% higher. It lowered its comparable-store sales growth projection for September to between flat and 1% growth, down from prior projections of an increase of between 1% and 3%.

Shares were falling 44 cents to $27.

Family Dollar sees a first-quarter profit of between 43 cents and 47 cents a share, compared with analysts' expectation of 42 cents a share.

For the full year, the company reported earnings of $242.9 million, or $1.62 a diluted share, vs. $195.1 million, or $1.26 a diluted share, in the prior year. Results in 2006 were impacted by one-time charges totaling $55.5 million, or 22 cents a diluted share.

The company reported full-year revenue of $6.83 billion, vs. $6.4 billion in fiscal 2006. For the full year, analysts had forecast earnings of $1.62 a share on revenue of $6.85 billion.

For the full year, the company projects earnings of between $1.74 and $1.85 a share, compared with analysts' expectations of $1.81 a share.