Summary
Dollar General Corporation's (DG) 2017 10-K filing highlights a period of continued growth and strategic focus on its core business model of providing value and convenience to a broad customer base. The company operated over 13,400 stores across 44 states, emphasizing its presence in rural, suburban, and urban communities. Its business model is centered on offering everyday low prices on a focused assortment of consumables, seasonal items, home products, and apparel, catering to value-conscious consumers. The report details a 27th consecutive year of positive same-store sales growth, underscoring the resilience of its value proposition across various economic conditions.
Financial Highlights
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Financial Statements
Beta
| Revenue | $21.99B |
| Cost of Revenue | $15.20B |
| Gross Profit | $6.78B |
| SG&A Expenses | $4.72B |
| Operating Income | $2.06B |
| Interest Expense | $97.82M |
| Net Income | $1.25B |
| EPS (Basic) | $4.45 |
| EPS (Diluted) | $4.43 |
| Shares Outstanding (Basic) | 281.32M |
| Shares Outstanding (Diluted) | 282.26M |
Key Highlights
- 1Dollar General operates a large network of 13,429 stores across 44 states, focusing on providing everyday low prices and convenience.
- 2The company achieved its 27th consecutive year of positive same-store sales growth in fiscal year 2016, demonstrating a resilient business model.
- 3Consumables represent the largest merchandise category at 76.4% of sales, though seasonal and home products typically offer higher gross profit margins.
- 4The company opened 900 new stores and remodeled or relocated 906 stores in fiscal year 2016, indicating an aggressive expansion and improvement strategy.
- 5Net sales increased by 7.9% to $21.99 billion in fiscal year 2016, driven by same-store sales growth and new store openings.
- 6Operating profit grew by 6.3% to $2.06 billion, while net income increased by 7.4% to $1.25 billion.
- 7Dollar General demonstrated a strong commitment to shareholder returns through dividends and a significant share repurchase program.
Frequently Asked Questions
Dollar General's primary strategy is to provide value and convenience to its customers by offering a broad selection of everyday necessities and general merchandise at everyday low prices in conveniently located, small-box stores. They focus on driving profitable sales growth, capturing growth opportunities, maintaining a low-cost operator position, and investing in their people.
In fiscal year 2016, Dollar General reported a 7.9% increase in net sales to $21.99 billion. Same-store sales grew by 0.9%. Operating profit increased by 6.3% to $2.06 billion, and net income rose by 7.4% to $1.25 billion, resulting in diluted earnings per share of $4.43.
Dollar General's main merchandise categories are Consumables (76.4% of sales), Seasonal (12.2%), Home products (6.2%), and Apparel (5.2%). The company notes that home products and seasonal categories typically account for the highest gross profit margins, while the consumables category generally has the lowest.
Dollar General is actively expanding its store base, planning to open approximately 1,000 new stores in fiscal year 2017 and remodel or relocate approximately 900 stores. They are also innovating store formats, including implementing the DG16 layout for new and remodeled stores and testing smaller format stores for potential growth in various areas.