Dollar General comps increase 3.7%, increases outlook
Strong sales of consumables and seasonal categories helped Dollar General achieve record second-quarter sales growth and prompted the company to increase its full-year outlook.
Same store sales at Dollar General increased 3.7 percent, driven by the ideal blend of increased customer traffic and larger transaction size. Total sales increased 3.7 percent, driven by increases in average transaction amount and customer traffic. Profits increased to $772 million, or diluted EPS of $2.88, for the 2018 26-week period, compared to net income of $574 million, or diluted EPS of $2.09, in the comparable 2017 period, an increase in diluted EPS of 37.8%.
“We delivered a strong second quarter and are proud of our team’s execution,” said Todd Vasos, Dollar General’s chief executive officer. “Our results this quarter were driven by contributions from our mature store base, as well as the robust performance of our new stores. In addition, we maintained our disciplined focus on cost control, which culminated in another quarter of significant earnings growth. At the same time, we also continued to invest in our strategic initiatives and made meaningful progress advancing against our goals. We are grateful to our approximately 134,000 employees throughout the company who continued to provide our customers with the value and convenience they have come to expect from Dollar General, and we are looking forward to a solid second half.”
The company repurchased $200 million of its common stock, or 2.1 million shares, under its share repurchase program in the second quarter of 2018, at an average price of $95.17 per share. From the inception of the share repurchase program in December 2011 through the end of the second quarter of 2018, the company has repurchased 85.1 million shares of its common stock at an average price of $64.58 per share, for a total cost of $5.5 billion. The total remaining authorization for future repurchases was approximately $1.0 billion at the end of the second quarter of 2018. Under the authorization, purchases may be made in the open market or in privately negotiated transactions from time to time subject to market and other conditions.
The Company is also reiterating its plans to open approximately 900 new stores, remodel 1,000 stores and relocate 100 stores within the fiscal year 2018.