GOODLETTSVILLE, Tenn. — A influx of new customers, as well as more frequent visits from returning shoppers, sent sales and profitability soaring for Dollar General in its fiscal first quarter, the retailer said Tuesday.
Same-store sales increased by 13.3% in the quarter, which ended May 1, as Dollar General generated net income of $83 million on sales of $2.8 billion. Sales improved by 15.7% compared with the same period last year, and profits were up by 1,307% from $5.8 million last year, due mainly to a gross margin improvement of 193 basis points, to 30.8% of sales.
In a conference call discussing results, Richard Dreiling, chief executive officer, said improvements in store operations and merchandising enacted last year paved the way for the sales gains, while lower fuel costs and reduced shrink helped improve profitability. The company this month began to outfit renovated stores and new locations with an updated logo and new décor as part of an overall branding effort, he added. As many as 300 stores will see the new look this year.
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