Sector: Consumer Staples|Industry: Discount Stores|Market Cap: $16.42B|Employees: 185.8K
Dollar General is the largest discount retailer in the United States by store count, operating over 20,000 stores across 48 US states and Mexico. The company offers a broad selection of merchandise, including consumable items, seasonal items, home products, and apparel, at everyday low prices, leveraging both national brands and its own private labels. Dollar General's competitive advantage lies in its convenient small-box store format and low-cost operating structure, allowing it to serve both small and large markets.
Dollar General reported a 2.4% increase in net sales to $9.69 billion compared to $9.46 billion in the prior year, primarily driven by new store openings. However, this growth was partially offset by a 1.3% decrease in same-store sales, indicating weaker performance in existing locations.
Gross profit margin decreased to 29.0% from 30.5% in the prior year, a decline of 147 basis points. This decrease was primarily attributed to increased inventory shrink (loss), lower inventory markups, and increased markdowns, indicating challenges in cost control and inventory management.
Operating profit decreased significantly by 41.1% to $433.5 million, compared to $735.5 million in the prior year. This decline reflects the combined impact of lower gross profit margins and increased SG&A expenses, highlighting a deterioration in overall profitability.