Dollar General 1Q Tops Street

By RetailFOXBusiness

Dollar General Corp. (NYSE:DG) said improved customer traffic and a higher average transaction amount boosted revenue in the fiscal first quarter, prompting the company to beat expectations and raise its full-year view.

The discount retailer increased its full-year forecast for adjusted earnings per share in the range of $2.68 and $2.78, up from its previous guidance for between $2.65 and $2.75 a share.  The company now expects full-year same-store sales to rise between 3% and 5%, with net sales up between 8% and 9% compared to net sales in 2011. That forecast is mostly better than the Street’s estimates for full-year earnings of $2.77 a share and revenue growth of 8.4%.

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For the fiscal first quarter, Dollar General reported net income rose 36% to $213 million, or 63 cents a share, compared with year ago profit of $157 million, or 43 cents a share, one year ago.

Net sales rose 13% to $3.9 billion, up from $3.45 billion, in the first quarter of last year. Same-store sales rose 6.7% and gross margin came in at 31.5%.

The results beat expectations, as analysts polled by Thomson Reuters had predicted earnings of 60 cents a share on revenue of $3.83 billion.

"I believe we are positioned well to invest in the future of our business as we continue to redefine small-box retailing and reinforce Dollar General's role as America's general store," said Rick Dreiling, chairman and chief executive officer, in a release.

In a separate release, the company announced a secondary public offering of 25 million common shares, to be sold by existing shareholders. Dollar General said it will not receive any proceeds from the offering. Citigroup (NYSE:C), Goldman Sachs (NYSE:GS) and KKR (NYSE:KKR) will serve as lead underwriters.

Shares of Dollar General fell 13 cents in the regular session, closing at $48.49.  The stock initially edged higher in after-hours trading, before sliding 2.6%.