By Christine Kern, contributing writer
Growth plans were outlined at the chain’s 2016 investor Conference.
Dollar General has announced plans to add approximately 1,000 new stores over the course of fiscal 2017, growth that falls in line with its model of 6-8 percent increase in square footage, according to a news release.
In addition, the dollar retailer plans to relocate or remodel 900 existing locations this year, following its earlier announcement that it plans to open approximately 900 new stores in fiscal 2016 and relocate or renovate another 875 stores.
“Dollar General has a powerful strategic plan that enables us to drive both the top line and bottom line to deliver strong financial returns as outlined in our growth model over the long-term. With strong cash flow and an efficient capital structure, we believe that we have a compelling opportunity to invest for growth while also returning cash to shareholders through consistent share repurchases and anticipated quarterly dividends,” said Todd Vasos, Dollar General’s chief executive officer.
Dollar General reported fourth-quarter sales growth of 7 percent and same-store increases of 2.2 percent, and now is forecasting annual sales growth between 7-10 percent.
Vasos was named CEO last June, replacing Rick Dreiling. Despite some challenging times for Dollar General, their latest figures and announcement demonstrate that the chain is on track to fulfill its growth plan. Discount chains like Dollar General have managed to thrive by attracting business away from struggling competitors like Walmart facing stagnant wage growth and other financial challenges.
In June, Vasos asserted, “Under Rick’s leadership, we have delivered exceptional results. My commitment is to build on that success. I believe Dollar General has an exciting future ahead and look forward to continuing to work with our talented employees to provide our customers with the everyday low prices that they count on from Dollar General.”
As of early 2016, Dollar General has more than 12,400 stores across 43 states. “We see a long runway to growth, with potential for nearly 20,000 Dollar General stores over time,” Stifel Nicolaus analyst Taylor LaBarr told CNBC.