GOODLETTSVILLE, Tenn.—Increases in both net sales and gross profit helped drive Dollar General to a 69 percent gain in net income in the third quarter, totaling $128.1 million.
Net sales rose 10 percent to finish the quarter at $3.2 billion, and gross margin increased 51 basis points to 31.4 percent. While selling, general and administrative expenses climbed 7.2 percent in dollars, they dropped 61 basis points as a percentage of sales to 22.8 percent. Dollar General was able to slim expenses related to incentive compensation, health care, external consulting and interest on borrowings.
Rick Dreiling, chairman and chief executive officer, credited the discount retailers’ “excellent performance” in an economic environment that “continues to be volatile for our customers.”
The retailer said it expects to report a 10.5 to 11 percent increase in net sales for the whole fiscal year, but added that it “is closely monitoring how consumers respond to both the economic and competitive climate during the current holiday season.”