Commodities

Dollar General lifts profit forecast, tops third-quarter expectations on sales

Credit: REUTERS/RICK WILKING

Discount store operator Dollar General Corp raised its full-year profit forecast on Thursday after reporting its best quarterly same-store sales rise in nearly five years, benefiting from a wider selection of products and revamped stores.

Updates share movement, adds sales, profit estimates and same-store sales forecast

Dec 5 (Reuters) - Discount store operator Dollar General Corp DG.N raised its full-year profit forecast on Thursday after reporting its best quarterly same-store sales rise in nearly five years, benefiting from a wider selection of products and revamped stores.

Shares of the company rose about 5% in premarket trading as the retailer raised its adjusted profit for fiscal 2019 to the range of $6.55 to $6.65 per share from $6.45 to $6.60.

The retailer has been aggressively opening hundreds of new stores, creating private label and adding food, health and beauty products to its existing outlets as it tries to better compete with other retailers and grocers.

The efforts boosted same-store sales growth to 4.6% in the third quarter ended Nov. 1, above the average analyst estimate of 3.34% increase, according to IBES data from Refinitiv.

The company now expects full-year same-store sales to grow in the mid-to-high 3% range compared with the prior low-to-mid 3% range.

The upbeat forecast comes in contrast to rival Dollar Tree Inc DLTR.O, which cut its full-year profit forecast last month, as the discount retailer fell short in its efforts to counter the impact of latest U.S. tariffs on Chinese imports.

Dollar General's net sales rose 8.9% to $6.99 billion in the quarter, above the estimate of $6.92 billion.

Net income rose to $365.6 million, or $1.42 per share, from $334.1 million, or $1.26 per share, a year earlier.

Analysts on average had expected a profit of $1.38 per share.

(Reporting by Soundarya J in Bengaluru; Editing by Arun Koyyur and Shinjini Ganguli)

((soundarya.j@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 2153; Twitter: https://twitter.com/Soundarya9615;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

US Markets

Latest Commodities Videos

#TradeTalks: Underlying Deflationary Pressures – Commodity Review

Jill Malandrino is joined by Peter Borish, Chief Strategist at Quad Group, to discuss deflationary pressures as well as the commodity review.

Feb 7, 2020

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More