Discount retailer Dollar General Corp. (DG: Quote) said Monday after the markets closed that its first quarter profit rose 36% from last year, helped by a double-digit sales growth.
The company's quarterly earnings per share, excluding items, also came in above analysts' expectations as did its quarterly sales. At the same time, the company raised its full year earnings outlook.
"Dollar General is starting off 2012 with strong performance in the first quarter due to excellent same-store sales growth of 6.7 percent, representing the fifth consecutive quarter of accelerating improvement," said Rick Dreiling, chairman and chief executive officer.
Separately, Dollar General announced an underwritten secondary public offering of 25.0 million common shares, which are being sold by certain existing shareholders. Certain of the selling shareholders have granted to the underwriters an option to purchase up to 3.75 million additional shares. The company is not selling any shares in the offering, and hence it will not receive any proceeds from the offering.
Dollar General shares are currently losing $1.32 or 2.72% in after hours trading after closing the day's regular trading session at $48.49, down 13 cents. The shares trade in a 52-week range of $29.84 to $49.50.
Dollar General reported net income for the first quarter of $213.4 million or $0.63 per share, compared to $157.0 million or $0.45 per share for the year-ago quarter.
Excluding items, adjusted net income for the first quarter was $215.1 million or $0.63 per share, compared to $166.3 million or $0.48 per share in the prior year quarter.
On average, 23 analysts polled by Thomson Reuters expected the company to earn $0.60 per share for the first quarter. Analysts' estimates typically exclude special items.
Net sales for the first quarter rose 13% to $3.90 billion from $3.45 billion in the same quarter last year. Twenty-one analysts had a consensus revenue estimate of $3.83 billion for the first quarter.
Same-store sales for the quarter increased 6.7% due to growth in both customer traffic and average transaction amount.
For the first quarter, sales of consumable items, the retailer's biggest revenue generator, surged 13.8%, while sales of seasonal goods climbed 14.8% and sales of home-products rose 10.6%. Apparel sales grew 3.9%.
Gross margin for the first quarter remained essentially flat with last year at 31.5%, as the favorable impact of higher markups, improved distribution and transportation efficiencies as well as lower inventory shrinkage rate were, offset by increased apparel and other markdowns and a higher mix of consumables.
During the first quarter, Dollar General repurchased 6.8 million shares of its common stock from Buck Holdings, L.P., which is controlled by affiliates of KKR and Goldman, Sachs & Co., for $300 million.
Looking forward, the company said it continues to expect total sales for fiscal year 2012 to increase 8% to 9% over the 53-week fiscal year 2011, or 10% to 11% on a comparable 52-week basis. Same-store sales are still expected to grow 3% to 5%.
However, the company raised its adjusted earnings outlook for the fiscal year 2012 to a range of $2.68 to $2.78 per share from its prior guidance of $2.65 to $2.75 per share.
Analysts currently expect the company to earn $2.77 per share on revenue of $16.05 billion for the fiscal year 2012.
The company reiterated its plans to open about 625 new stores and to remodel or relocate about 550 stores in fiscal 2012.
| || |
| To receive FREE breaking news email alerts for Dollar General Corp and others in your portfolio|
by RTT Staff Writer
For comments and feedback: email@example.com