In a December 5^th release, Dollar General, Inc. (DG) announced Q3 FY 2024 results for the period ending November 1^st. The Company exceeded estimates on revenue and earnings and adjusted FY 2024 outlook with an evident impact on share price.

For Q3 Dollar General Inc. posted net income of $197 million on total revenue of $10,183 million with a diluted EPS of $0.89. Comparable values for Q3 FY 2023 ending November 3^rd were net income of $276 million on revenue of $9,694 million with a diluted EPS $1.26.

Revenue was up 2.2 percent in Q3 2024 compared to Q3 2023. During the most recent quarter, Dollar General attained a gross margin of 25.9 percent (29.0  percent in Q3 2023) and an operating margin of 3.2 percent, down from 4.5 percent in Q3 2023.

For Q3 2023, consolidated comparable store sales, increased by 1.3 percent

The classification of revenue by category in Q3 FY 20234 comared to Q3 2023 comprised:-

• Consumables  including food*,   82.9%  up 6.4%
• Seasonal items,                             9.3%   unchanged
• Home products,                            5.1%   down 2.3%
• Apparel,                                        2.7%   down 1.2%

* not separated by category

In commenting on results, Todd Vasos, CEO stated, “ We are pleased with our team’s execution in the third quarter, particularly in light of multiple hurricanes that impacted our business,” He added, “While we continue to operate in an environment where our core customer is financially constrained, we delivered same-store sales near the top end of our expectations for the quarter. We believe our Back to Basics efforts contributed to these results, as we have continued to improve our execution and the customer experience in our stores.”

Vasos concluded, “Looking ahead, we are excited about our robust real estate plans for 2025. We believe our balance of new store growth and a significantly increased number of projects impacting our mature store base will further solidify Dollar General as an essential partner to communities in rural America, while strengthening our foundation to drive long-term sustainable growth and shareholder value.”

Dollar General is conducting a trial same-day delivery service presumably to compete with Walmart in certain areas.

Guidance for FY 2024 was adjusted including net sales growth of 4.7 to 5.3 percent; same-store sales growth of 1.1 to 1.4 percent; and diluted EPS, to a range of $5.50 to $5.90. Capital expenditure will attain $1,350 million for 730 new store openings, and 1,620 remodels.

During Q2 FY 2024 Dollar General opened a net 537 new stores. As of November 1^st the Company operated a total of 20,532 stores representing 166,169 square feet, a 5.1 percent growth for the quarter. Expenditure for property purchases and equipment during FY 2024 to date  attained $1,000 million  including new stores, remodels and upgrades to DCs, transport and technology.

Effective November 1^st 2024, Dollar General posted total assets of $31,461 million including $5,539 as goodwill and intangibles. The Company carried long-term debt and lease obligations of $15,869 million.  Dollar General attained a market capitalization of $1,794 million on December 9^th 2024 compared to $29,000 on January 31^st 2024. The share has traded over the past 52 weeks from $168.07 down to $72.12 with a 50-day moving average of $79.74. DG closed at $81.70 on December 4^th, pre-release, falling sharply on the December 5^th open but recovering at close to $79.16. Dollar General trades with a forward P/E of 12.6.  For the trailing 12-months the company posted an operating margin of 5.4 percent and a profit margin of 3.6 percent, returning 4.3 percent on assets and 20.9 percent on equity.