Retail News Breaks
Dollar General sees uptick in 1Q earnings
June 3rd, 2014
GOODLETTSVILLE, Tenn. – Dollar General Corp. today said its fiscal first quarter profit rose to $224.2 million, or 72 cents a share, from $220.1 million, or 67 cents a share, a year earlier.
The discount retailer reiterated its full-year earnings guidance of between $3.45 and $3.55 per share on same-store sales growth of 3% to 4%. Total sales are projected to grow 8% to 9%, the company said.
Same-store sales in the three months ended May 2 increased by 1.5%. Company officials cited “unfavorable” weather, a challenging economic environment and increased competition for the below-par sales growth in the first quarter. Analysts had been expecting the company to report a 2.6% increase in same-store sales.
The company said sales of consumables, such as tobacco products and perishables, significantly outpaced nonconsumable categories. Consumables have significantly lower margins, which weighed on gross profit in the quarter.
“We continue to grow both our customer traffic and average transaction amount as our merchandising initiatives reinforce our affordability and value messaging,” said Rick Dreiling, Dollar General’s chairman and chief executive officer.
The company said it has more U.S. retail locations than any other retailer. Dollar General ended its most recent fiscal year with 11,132 stores in 40 states, up from 10,506 stores at the end of the previous year. Many of its stores are in small towns that tend to be bypassed by larger retailers. About 25% of its merchandise is priced at $1 or less. Stores offer household products, health and beauty aids, apparel, food, and other items.
Dollar General said it bought 14.1 million shares of common stock in the first quarter as part of its share repurchase program.
The company opened 214 new stores in the first quarter.
More Retail News Breaks >>