Dollar General Corp. shares DG were moving about 3% lower in premarket action Thursday though the discount retailer met total sales expectations for its latest quarter and disclosed a dividend increase. The company saw fourth-quarter net income of $659.1 million, or $2.96 a share, up from $597.4 million, or $2.57 a share, in the year-earlier period. Analysts tracked by FactSet were expecting $2.95 a share. Dollar General generated net sales of $10.2 billion in the quarter, up from $8.7 billion a year prior and in line with the FactSet consensus. The increase was largely fueled by same-store sales growth and contributions from new stores, though some store closures weighed on overall growth. Same-store sales were up 5.7% in the quarter, while analysts were modeling 5.8% growth. For fiscal 2023, Dollar General expects 3.0% to 3.5% growth in same-store sales. Analysts were modeling 3.4% growth. The company also expects that it will see roughly 5.5% to 6.0% growth in net sales, including an anticipated two-point negative impact related to the fact that fiscal 2022 had 53 weeks. Analysts tracked by FactSet were modeling $40.0 billion in net sales for the fiscal year, up about 5.8% from the $37.8 billion in net sales that Dollar General reported Thursday for fiscal 2022. “Our fiscal 2023 full-year outlook reflects our confidence in the business, even in a potentially challenging economic and operating environment,” Chief Financial Officer John Garratt said in a release. “While we anticipate the first half of fiscal 2023 to be negatively impacted by ongoing sales mix pressures, higher shrink levels, increased damages, and higher interest expense, we are confident in our full-year plans.” The company noted in its release that the board of directors declared an increase of the dividend to 59 cents a share. Dollar General was previously paying 55 cents a share.
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