Dollar General Posts 2 Cent Loss
Dollar General posted a quarterly loss on Tuesday, hurt by costs for closing stores and writing off stale inventory.
The discount retailer, which has struggled with lackluster demand for clothing, said holiday-related sales were positive so far, although it remained cautious in its outlook in a "highly competitive retail environment."
Dollar General reported a net loss of $5.3 million, or 2 cents a share, for the fiscal third quarter that ended Nov. 3, compared with a profit of $64.4 million, or 20 cents a share, a year earlier. Analysts, who normally exclude one-time charges, were looking for profits of 15 cents a share in the latest quarter.
Results in the latest period include $79.2 million in pretax costs and charges for inventory markdowns and planned store closings. The retailer announced in late November that it would shut about 400 stores and record $138 million in charges as it tries to revive sales growth.
Dollar General has lagged competitors such as Family Dollar Stores in recent quarters, and analysts had urged the company to eliminate stockpiles of inventory and slow store expansion.
Net sales rose 7.6% to $2.21 billion, while sales at stores open at least a year -- a key retail measure known as same-store sales -- rose 2%.
The retailer said it had taken steps to ensure that its stores were better prepared for the holiday season, and inventories were better managed than in prior years.