Dollar General to open 730 stores in 2015 as it accelerates expansion

Goodlettsville, Tenn. -- Dollar General Corp. is not sitting back while rivals Family Dollar and Dollar Tree prepare to merge. Following its failed bid to acquire Family Dollar, Dollar General has accelerated its expansion plans for 2015. The discounter, which already has the retail industry’s most aggressive new store strategy said it will open 730 new stores and remodel 875 existing locations in 2015, translating into a 6% increase in total square footage. And looking ahead, Dollar General plans to grow its square footage by 7% in 2016.



The acceleration in growth follows a strong fourth quarter performance by the chain. Net sales increased 9.9% to $4.94 billion, and same-store sales grew 4.9% amid increases in customer traffic and average transaction size. Dollar General ended the quarter with 11,789 units.



Profits increased to $355 million, or $1.17 a share, compared to $322 million, or $1.01 a share the prior year, and would have been about two cents a share higher had the West coast port slowdown not delayed the receipt of some higher margin products.



“In 2014, momentum built in our business as we moved through the year, marking our twenty-fifth year of consecutive same-store sales growth,” stated Dollar General chairman and CEO Rick Dreiling. “We are pleased with our fourth quarter results which reflect accelerating same-store sales and we intend to capitalize on that momentum as we move into 2015.”



Going forward, Dreiling said, the chain has “exciting operating plans that build on our competitive strengths.”



“For 2015, we are forecasting a year of strong growth including a total sales increase of 8% to 9%, same store sales growth of 3% to 3.5% and EPS growth of 10% to 13% over 2014 adjusted EPS. Given our strong return profile for new stores, we plan to accelerate our new store openings to approximately 7% square footage growth in 2016,” Dreiling stated.



For the full year, sales increased 8% to $18.9 billion and same-store sales increased 2.8%. Net income increased to $1.065 billion, or $3.49 a share, compared to $1.025 billion, or $3.17 a share.