Q4 Highlights
For its Q4 ended Feb. 2, Dollar General's net sales decreased 3.4% to $9.9 billion, compared with net sales of $10.2 billion in last year's fourth quarter. This decrease was primarily driven by lapping sales of $678 million from the 53rd week in fiscal 2022. Net sales performance was highlighted by accelerating market share growth in both dollars and units in highly consumable product sales, as well as market share growth and dollars in nonconsumable product sales.
Same-store sales grew slightly by 0.7%. The increase was driven by growth of nearly 4% and customer traffic.
SG&A was 23.6% as a percentage of sales, an increase of 189 basis points. This increase was primarily driven by retail labor, including the remaining $50 million of the company’s targeted labor investment, as well as store occupancy costs, depreciation and amortization, repairs and maintenance, and other services purchased.
Operating profit for Q4 decreased 37.9% to $580 million. As a percentage of sales, operating profit was 5.9%, a decrease of 327 basis points.
Finally, EPS for the quarter decreased 38% to $1.83, which was at the higher end of its internal expectations. For the full year, EPS decreased 29% to $7.55.
Dollar General expects a comp-sales increase of 1.5% to 2% in the first quarter of 2024, with EPS in the range of approximately $1.50 to $1.60.
Meanwhile, Dollar General continues to make advancements in its fresh initiative: It now has nearly 30 doors per store on average, with ongoing opportunities to add cooler doors and frozen and refrigerated items.
The retailer had fresh produce in more than 5,400 stores at the end of FY2023, and is targeting up to 1,500 additional stores for produce in 2024.
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Regarding store growth, the retailer executed more than 3,000 real estate projects in 2023, including 987 new stores, 129 relocations and 2,007 remodels.
The company expects to build on this momentum in 2024, as it plans to execute approximately 2,385 projects, including 800 new store openings, 1,500, remodels and 85 relocations. The store-opening plans include 30 pOpshelf stores and up to 15 stores in Mexico.
Goodlettsville, Tenn.-based Dollar General operates 20,000 Dollar General, DG Market, DGX and pOpshelf stores across the United States, and Mi Súper Dollar General stores in Mexico. The company is No. 16 on The PG 100, Progressive Grocer’s 2023 list of the top food and consumables retailers in North America.