Strong Dollar General Quarter Preps Retailer for High-Growth Year
GOODLETTSVILLE, TN - Buzz surrounding Dollar General’s high-growth strategy has been loud over the past few fiscal years, and it looks like 2018 will be no exception. In a release touting the retailer’s double-digit sales increases during its Q3, CEO Todd Vasos reaffirmed Dollar General’s plan to continue investing in new stores and remodels.
"We remain excited about the future for Dollar General,” said Vasos. “For fiscal 2018, we have plans to execute approximately 2,000 real estate projects comprised of 900 new stores, 1,000 store remodels, and 100 store relocations. We continue to believe that investing in the business through our high-return new store growth is the best use of our capital to help drive long-term shareholder value. Our new store growth is complemented with a significant increase in our store remodel program from fiscal 2017 that we view as an investment to enhance and consistently deliver on our brand promise to help our customers save time and money every day.”
And with the help of this strong quarterly report, it looks as if Dollar General will be well-prepared to take on the 2,000-project challenge. Q3 net sales increased 11.0 percent, reaching $5.90 billion. This is up from Q3 2016’s sales number of $5.32 billion. The company noted in its release that this increase in sales was positively affected by sales from new stores, and modestly offset by sales from closed stores.
"We are pleased with our overall third quarter results, which include a strong same-store sales growth of 4.3% and increases in both average transaction amount and customer traffic over the 2016 third quarter,” Vasos said. “During the quarter, we effectively balanced our same-store sales growth while achieving gross profit rate expansion and continuing our planned investments in the business.
In addition to the sales increase, the following other areas were highlights of Dollar General’s Q3 financial report:
- Gross profit, as a percentage of net sales, was 29.9 percent in the 2017 third quarter, an increase of eight basis points from the 2016 third quarter
- Net income was $253 million, or $0.93 per diluted share, up from $235 million, or $0.84 per diluted share, in the 2016 third quarter
- Total additions to property and equipment in the 39-week period ended November 3, 2017 were $489 million
- The Company opened 1,044 new stores and remodeled or relocated 719 stores. The new store growth includes the rebannering of 263 store locations acquired in the second quarter of 2017
AndNowUKnow is keeping a close eye on Dollar General as it seeks to take over U.S. soil with new and remodeled store locations. Stay tuned for continued updates!