Dollar General Q2 profit tops Street, on track to open 730 stores

Goodlettsville, Tenn. — Dollar General posted better-than-expected earnings for the second quarter, but came up short on sales, even amid strong demand for tobacco products and other consumables.

The discounter reiterated plans to open approximately 730 stores in 2015, and relocate or remodel 875 units. To date, the company is on track with its pipeline development to accelerate new store openings to 7% square footage growth in 2016.

Dollar General’s net income surged 12% to $282 million from $251 million last year. Net sales increased 7.9% to $5.1 billion, compared to $4.72 billion last year.

Same-store sales increased 2.8%, with increases in both customer traffic and average transaction value. Within non-consumables, the most significant growth was due to seasonal items, sundries, hardware and housewares.

Total sales are expected to increase 8 to 9% from the 2014 fiscal year during fiscal 2015. Same-store sales expected to increase 3 to 3.5%.

“Looking ahead to 2016, our team is energized to accelerate our pace of growth as we focus on providing our consumers with everyday low prices and convenient locations,” Todd Vasos, who replaced Rick Dreiling as CEO in June, said. “We remain confident in the long-term growth prospects for Dollar General to deliver strong financial results and healthy cash returns for our shareholders.”