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Dollar General Holiday-Quarter Sales, Forecast Miss Estimates

Thursday, 13 Mar 2014 10:14 AM

Retailer Dollar General Corp. on Thursday posted lower-than-expected sales for the holiday quarter, blaming cold weather, aggressive competition and low consumer confidence.

The discount chain also gave a disappointing profit forecast for the fiscal year and said its frugal shoppers were still feeling pinched by a tough economy.

The company's shares were down 1.8 percent to $58.25 in premarket trading.

Dollar General follows Wal-Mart Stores Inc., Target Corp., Kohl's Corp. and other retailers catering to lower-income shoppers in reporting weaker-than-expected sales for what analysts have called a particularly competitive holiday season.

"The volatility of the macroeconomic environment continues to pressure the consumer," Dollar General said in a press release.

Sales in the fourth quarter ended on Jan. 31 rose 6.8 percent to $4.49 billion. Analysts on average were expecting $4.62 billion, according to Thomson Reuters I/B/E/S.

Sales at stores open at least a year rose 1.3 percent, while Wall Street thought they would increase 4.5 percent.

Still, Dollar General did draw more customers. It also sold more tobacco products and perishables, which are two fast-growing categories for the retailer but offer smaller gross profit margins.

Earnings rose to $322.17 million, or $1.01 per share, from $317.4 million, or 97 cents per share a year earlier.

Dollar General expects same-store sales to be up 3 percent to 4 percent this fiscal year. It forecast a profit of $3.45 to $3.55 per share, while analysts expected $3.69.

© 2017 Thomson/Reuters. All rights reserved.

 
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Retailer Dollar General Corp. on Thursday posted lower-than-expected sales for the holiday quarter, blaming cold weather, aggressive competition and low consumer confidence.
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2014-14-13
Thursday, 13 Mar 2014 10:14 AM
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