Dollar General reveals 2,000 store plan
Dollar General’s 4.3% third quarter same store sales increase handily exceeded analysts’ estimates and the company disclosed a massive, even by Dollar General standards, 2018 real estate plan involving new and remodeled stores.
More people shopped Dollar General’s 14,321 stores more often and bought more consumables, apparel and seasonal products during the third quarter, propelling the company to a 4.3% same store sales increase. Even discounting a 30 to 35 basis point favorable impact from several hurricanes, Dollar General’s comp sales increase easily exceeded analysts’ forecast of 2.8%.
Total sales increased 11% to $5.9 billion thanks to the combination of same store sales growth and a huge increase in new stores and remodeled stores. Through the first three quarters of the year, Dollar General opened 1,044 new stores and remodeled or relocated 719 stores. The company’s new store opening figure is higher than normal this year due to the acquisition and subsequent rebranding of 263 stores in the second quarter. Additional openings and remodeling projects will see Dollar General end the current fiscal year on Feb. 2, 2018 having opened a total of 1,285 stores in addition to remodeling or relocating 760 stores.
“We remain excited about the future for Dollar General. 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,” said Dollar General CEO Todd Vasos. “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.”
Net income increased to $253 million, or 93 cents a share, compared to $235 million, or 84 cents a share, the prior year.