FILE- In this Aug. 3, 2017, file photo the Dollar General store is pictured in Luther, Okla. Dollar General reports financial results Thursday, March 14, 2019. (AP Photo/Sue Ogrocki, File) AP
GOODLETTSVILLE, Tenn. (AP) — Dollar General Corp. posted mixed fourth-quarter results, with profit pressured by an income tax expense while revenue grew during the critical holiday period. The discount retailer also provided a fiscal 2019 profit outlook below Wall Street’s view.
Shares fell 6.8 percent before the market open on Thursday.
The discount retailer earned $483.2 million, or $1.84 per share, for the fiscal period ended Feb. 1. A year earlier the Goodlettsville, Tennessee-based company earned $712.2 million, or $2.63 per share.
The current quarter included an income tax expense of $130.2 million.
The performance was 4 cents short of what analysts surveyed by Zacks Investment Research were calling for.
“As disappointing as this is, we do not view it as particularly problematic as it is the result of a higher income tax provision over the prior year when Dollar General received a tax benefit,” Neil Saunders, managing director of GlobalData Retail, said in a statement.
Revenue increased to $6.65 billion from $6.13 billion, topping the $6.6 billion that Wall Street expected.
Sales at stores open at least a year, a key gauge of a retailer’s health, rose 4 percent.
Saunders said Dollar General Corp. was able to get more of its customers’ disposable income during the quarter, thanks to an increase in fresh and chilled produce in stores and a strong performance from non-food items during the holiday period.
“Overall, we remain impressed by Dollar General’s ability to create a compelling and enhanced shopping experience,” he said.
For the year, Dollar General reported a profit of $1.59 billion, or $5.97 per share, on revenue of $25.63 billion.
Dollar General expects fiscal 2019 earnings of $6.30 to $6.50 per share. Analysts polled by FactSet predict $6.63 per share.
The retailer, which now operates about 15,370 locations in 44 states, also said it plans to open 975 new stores. Last week, rival Dollar Tree announced that it was closing up to 390 Family Dollar stores this year and rebranding about 200 others under the Dollar Tree name.
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