Dollar General to Accelerate Store Count Growth in 2020
GOODLESTTSVILLE, Tenn. — Dollar General Corp. plans to open 1,000 stores in 2020, up from 975 in 2019. It also will undertake 1,500 mature store remodels and 80 store relocations, reported Convenience Store News sister publication Chain Store Age.
The retailer announced its expansion plans during its third-quarter earnings call, during which it also reported its best quarterly same-store sales rise in nearly five years along with increases on both its top and bottom lines.
"We are excited to accelerate our real estate growth plans in 2020," said Todd Vasos, CEO of Dollar General. "The sustained positive results we are seeing from our portfolio of real estate projects further validates our belief that our ongoing investment in high-return real estate projects, along with our strategic initiatives, is the best use of our capital as we look to continue delivering long-term shareholder value."
Net income totaled $365.6 million for the quarter ended Nov. 1, compared to $334.1 million during the same period one year ago.
Net sales increased 8.9 percent to $6.99 billion. Same-store sales increased 4.6 percent, driven by increases in both average transaction amount and customer traffic.
Growth in the consumables, seasonal, home, and apparel categories were notable during Q3, according to the company.
"The quarter was highlighted by our best customer traffic and same-store sales increases in nearly five years, as well as double-digit growth in both operating profit and diluted EPS," said Vasos. "We continue to execute well on many fronts, while maintaining our focus on delivering value and convenience for our customers. As a result of our performance through the first three quarters of 2019 and outlook for the fourth quarter, we are raising our full-year financial guidance as we work to finish a strong year."
Dollar General also updated its financial guidance and noted that its forecast assumes that it can successfully mitigate, absorb, or otherwise offset the impact of tariffs on certain products imported from China.
For fiscal year 2019, Dollar General expects:
Net sales growth in the low 8 percent range, compared to its previous expectation of approximately 8 percent;
Same-store sales growth in the mid-to-high 3 percent range, compared to its previous expectation in the low-to-mid 3 percent range; and,
Adjusted earnings per share in the range of $6.55 to $6.65, compared to its previous range of $6.45 to $6.60...
Regarding the DG Fresh program, Vasos stated that Dollar General is currently self-distributing frozen and refrigerated goods to approximately 4,900 stores out of four facilities, with the number of stores expected to increase to 5,500 and a fifth DG Fresh facility to begin operation by year-end, reported fellow Convenience Store News sister publication Progressive Grocer.
At the store level of DG Fresh, "during the first three quarters we added nearly 35,000 cooler doors across our store base," Vasos said. "In total, we expect to install more than 40,000 cooler doors this year as we continue to build on our multi-year track record of growth in cooler doors and associated sales."
Goodlettsville, Tenn.-based Dollar General operates 16,094 stores in 44 states.
Convenience Store News, Chain Store Age and Progressive Grocer are properties of EnsembleIQ.