Dollar General Q1 Profit Beats Estimates; Comps. Up 2.2%

(RTTNews) - Dollar General Corp. (DG) reported first-quarter net income of $295 million, or $1.03 per share compared to $253 million, or $0.84 per share, a year ago. On average, 25 analysts polled by Thomson Reuters expected the company to report profit per share of $0.95 for the quarter. Analysts' estimates typically exclude special items. The company noted that income tax benefit in the 2016 first quarter for the accounting standard adoption was approximately $9.0 million or $0.03 per share.

Net sales increased 7.0 percent to $5.27 billion in the 2016 first quarter compared to $4.92 billion in the 2015 first quarter. Analysts expected revenue of $5.28 billion for the quarter.

Same-store sales in the 2016 first quarter increased 2.2 percent resulting from increases in both customer traffic and average transaction amount. The company said its first-quarter same-store sales increases were driven by positive results in both the consumables category and certain of the non-consumables categories, with sales of consumable merchandise outpacing sales of non-consumable merchandise.

During the 2016 first quarter, the company opened 249 new stores and remodeled or relocated 301 stores. For 2016, the company plans to open 900 new stores and remodel or relocate 875 stores. For 2017, the company intends to accelerate its square footage growth with plans to open about 1,000 stores and remodel or relocate about 900 stores.

"We remained keenly focused on ensuring the effectiveness and efficiency of every aspect of our business as we delivered both gross margin expansion and selling, general and administrative expense leverage. This balanced performance contributed to operating profit improvement of 12% and diluted earnings per share growth of 23%," said Todd Vasos, Dollar General's CEO.

On May 24, 2016, the Board of Dollar General declared its regular quarterly cash dividend of $0.25 per share on the company's common stock. The second quarter dividend will be payable on June 29, 2016 to shareholders of record at the close of business on June 15, 2016.

In the 2016 first quarter, the company repurchased 2.7 million shares of its common stock under share repurchase program at an average price of $84.81 per share.