Getting it done at Dollar General

GOODLETTSVILLE, Tenn. Sales and profits at Dollar General grew at a healthy pace during the second quarter as the company’s value proposition resonated with cost-conscious shoppers.

Profits increased $141.2 million, or 41 cents per share — better than the 38 cents a share analysts were expecting — compared with $93.6 million, or 29 cents per share in the year-ago period. Sales increased 10.8% to $3.21 billion, and same-store sales grew 5.1% in the quarter on top of a prior year gain of 8.6%. The company also pointed out an increase in customer traffic and transaction size, noting that more customers frequented Dollar General and spent more on each visit during the second quarter.

“Our outstanding result for the second quarter built on our track record of success over the last 10 quarters,” said Rick Dreiling, Dollar General’s chairman and CEO. “The combination of the right strategies, good execution and superior margin performance enabled us to effectively manage through a volatile quarter.”

Dreiling noted that sales accelerated in the last month of the quarter ended July 31 and have been encouraging one month into the third quarter. Accordingly, the company bumped up its full-year profitability forecast to a range of $1.68 to $1.74, a share from a prior range of $1.62 to $1.69 a share. Full-year same-store sales are expected to fall within a range of 4% to 6%.

At the midpoint in its fiscal year, Dollar General opened 315 new stores and relocated or remodeled 301 others, giving it a total of 9,113 units, which the company pointed out is more locations than any retailer in America.