In 2024, the company opened 725 new stores, including five in Mexico. This indicates a continued focus on expansion, particularly in new markets like Mexico.

The company initiated a store portfolio optimization review, leading to the decision to close 96 Dollar General stores and 45 pOpshelf stores, and convert an additional six pOpshelf stores to Dollar General stores. This suggests a strategic shift in resource allocation and a focus on profitability.

The company is expanding its efforts to improve the performance and profitability of mature stores through the rollout of an incremental remodel program, Project Elevate. This indicates a focus on improving existing store performance.

The company experienced significant levels of inventory shrink and damages in 2024, indicating potential operational inefficiencies and challenges in loss prevention.

The company continues to take actions designed to reduce their impact and believes it will make progress in reducing its shrink and damages levels in 2025, indicating a proactive approach to addressing the issue.

As the company works to provide everyday low prices and meet its customers' affordability needs, it remains focused on enhancing its margins through inventory shrink and damage reduction initiatives, as well as pricing and markdown optimization, effective category management and inventory reduction efforts, distribution and transportation efficiencies, private brands penetration and global sourcing.

Many customers have fixed or low incomes, making them susceptible to economic downturns. Factors like unemployment, inflation, and reduced government assistance could decrease spending and profitability.

The retail business is highly competitive, requiring the company to lower prices or limit price increases, resulting in lower margins and reduced profitability. Competitors may have greater resources and secure better arrangements with suppliers.

The company's future growth depends on attracting and retaining qualified employees while controlling labor costs. External factors like competition for personnel and wage rates could hinder the company's ability to meet labor needs.

The company believes it differentiates itself from other forms of retailing by offering competitive prices in a convenient, small-store format. It maintains competitive prices due in part to its low-cost operating approach and the relatively limited assortment of products offered.

Competition is intense, and is expected to continue to be so, with certain competitors reducing their store locations while others enter or increase their presence in our geographic and product markets and expand availability of mobile, web-based and other digital technologies.

The company currently does not offer traditional online shopping to a significant degree and have seen a greater willingness of our customers to adopt online shopping. In addition, if our competitors or others were to enter our industry sector in a significant way, including through alliances or other business combinations, it could significantly alter the competitive dynamics of the retail marketplace and result in competitors with greatly improved competitive positions.

As the company works to provide everyday low prices and meet its customers' affordability needs, it remains focused on enhancing its margins through inventory shrink and damage reduction initiatives, as well as pricing and markdown optimization, effective category management and inventory reduction efforts, distribution and transportation efficiencies, private brands penetration and global sourcing.

The company is taking actions designed to reduce its higher than targeted store manager turnover, including through budgeting and allocation of labor hours, simplifying in-store activities, and reducing excess inventory.

The company relies on its distribution and transportation network to provide goods to its stores timely and cost-effectively. Using various transportation modes, including ocean, rail, and truck, we and our vendors move goods from vendor locations to our distribution centers and our stores, and we also lease additional temporary warehouse space as necessary to support our distribution needs.

The company continues to implement and invest in certain strategic initiatives that it believes will help drive profitable sales growth with both new and existing customers and capture long-term growth opportunities. Such opportunities include providing our customers with a variety of shopping access points and even greater value and convenience by leveraging and developing digital tools and technology, such as our Dollar General app.

The company remains focused on enhancing both the in-store and digital shopping experience, while driving operational efficiency. Our partnership with a third-party delivery service is available in the majority of our stores, providing added convenience and incremental sales.

In 2025, the company is expanding its efforts to improve the performance and profitability of mature stores through the rollout of an incremental remodel program, Project Elevate. This partial-remodel initiative is designed to refresh and optimize the merchandising in our stores, and in turn, enhance the shopping experience for our customers, while also mitigating future repairs and maintenance expense.

As planned, to preserve our investment grade credit rating and maintain financial flexibility, we did not repurchase any shares during 2024 under our share repurchase program and do not plan to repurchase shares during 2025.

To further enhance shareholder returns, the company pays a quarterly cash dividend. The declaration and amount of future dividends are subject to Board discretion and approval, although we currently expect to continue paying quarterly cash dividends.

The company anticipates funding 2025 capital requirements with a combination of some or all of the following: existing cash balances, cash flows from operations, availability under our Revolving Facility and/or the issuance of additional CP Notes.

The company's operations are subject to the applicable federal, state, local and foreign laws, rules, and regulations of the jurisdictions in which we operate or conduct business. These laws, rules and regulations relate to, among other things, the sale of products, including without limitation, product and food safety, marketing and labeling; information security and privacy; labor and employment; employee wages and benefits; health and safety; real property; public accommodations; anti-bribery; financial reporting and disclosure, including disclosures related to environmental, social and governance matters; pricing; antitrust and fair competition; anti-money laundering; distribution; transportation; imports and customs; intellectual property; taxes; and environmental compliance.

The company may face criticism as a result of either “anti-ESG” or “pro-ESG” sentiment among governmental authorities, regulators, shareholders, employees and/or customers. Negative reputational incidents could adversely affect our business through declines in customer loyalty, vendor partnerships, lost sales, loss of new store and development opportunities, or employee retention and recruiting difficulties and could also result in loss of shareholder support and trust and require us to expend disproportional resources toward these matters.

The company's operations are subject to the applicable federal, state, local and foreign laws, rules, and regulations of the jurisdictions in which we operate or conduct business. These laws, rules and regulations relate to, among other things, labor and employment; employee wages, salary levels and benefits; health and safety.

Our core customers are often among the first to be affected by negative or uncertain economic conditions and among the last to feel the effects of improving economic conditions, particularly when trends are inconsistent and of an uncertain duration.

Our customers continue to feel constrained in the current macroeconomic environment and to experience elevated expenses that generally comprise a large portion of their household budgets, such as rent, healthcare, energy and fuel prices, as well as cost inflation in frequently purchased household products (including food).

This pressure contributed to a heavier promotional environment in the second half of 2024 compared to the prior year, and we expect a promotional environment in 2025 similar to that in 2024.