Dollar General Sees Full-Year Profit Below Views
Dollar General Stores Inc (NYSE:DG) forecast full-year earnings below analysts' expectations, as the company plans to open more stores ahead of a merger of its rivals Family Dollar Stores Inc (NYSE:FDO) and Dollar Tree Inc (NASDAQ:DLTR).
Dollar General forecast earnings of about $3.85-$3.95 per share for the year ending January 2016, below the average analyst expectation of $3.99.
The company said it expects to spend $500 million to $550 million in 2015, partly to open about 730 stores.
Dollar General stands to lose its position as the top discount retailer in the United States after failing to upend a merger agreement between Family Dollar Stores and Dollar Tree.
Dollar General said full-year total sales are expected to grow 8-9 percent, translating to sales of $20.42 billion to $20.61 billion.
Analysts on average were expecting revenue of $20.54 billion, according to Thomson Reuters I/B/E/S.
Same-store sales are expected to grow 3-3.5 percent, the company said.
Dollar General also authorized a $1 billion share repurchase plan, and said Chief Financial Officer David Tehle will retire on July 1.
Net income rose to $355.4 million, or $1.17 per share, in the fourth quarter ended Jan. 30, from $322.2 million, or $1.01 per share, a year earlier.
Net sales increased 9.9 percent to $4.94 billion.
Analysts had expected earnings of $1.17 per share and revenue of $4.95 billion.
Same-store sales rose 4.9 percent, in line with average expectation of analysts polled by research firm Consensus Metrix.
(Reporting by Nandita Bose in Chicago and Sruthi Ramakrishnan in Bengaluru; Editing by Joyjeet Das and Sriraj Kalluvila)