Dollar General Q4 disappoints; to open 700 new stores in 2014
Goodlettsville, Tenn. — Dollar General on Thursday reported a 1.5% rise in fourth-quarter profits, below analysts’ estimates, as the retailer felt the impact of harsh winter weather, along with increased competition and low consumer confidence. The company also said it plans to open approximately 700 new stores in 2014.
The retailer earned $322.2 million in the quarter ended Jan. 31, compared with $317.4 million a year earlier.
Revenue rose 6.8% to $4.49 billion, which was below the Street’s expectations. Same-store sales increased 1.3%.
“Sales in the fourth quarter were impacted by severe winter weather, including many days with significant store closures, an aggressive competitive retail landscape and our customers` uncertainty about spending in the current economic environment,” Dollar General CEO Rick Dreiling said in a statement.
For the full year, Dollar General earned $1.03 billion, up from $952.7 million the year before. Revenue rose to $17.5 billion from $16.02 billion.
Same-store sales rose 1.3% in 2013. It was Dollar General’s twenty-fourth consecutive year of same-store sales growth.
For 2014, Dollar General has budgeted $450 million to $500 million for capital expenditures, and plans to open 700 new locations. This comes on top of a record year of square footage expansion in 2013.
“Among our other many accomplishments for the year, we successfully opened 650 new stores, ending the year with 11,132 stores serving customers in 40 states,” Dreiling said. “Dollar General is a strong and growing business with high return store growth opportunities that we intend to capture. While we remain cautious on the current operating environment and the many challenges our customer is facing in 2014, we have a business model that generates significant cash flow, putting us in a position to invest in these growth opportunities, while continuing to return cash to shareholders through share repurchases.”
Report: Target had early notice of breach
Minneapolis – Target Corp. reportedly had early notice of the holiday data breach that exposed the personal and financial information of millions of customers but did not act upon it. According to Bloomberg, a $1.6 million security application called FireEye notified Target of a possible intrusion in to its network, but the retailer failed to respond.
FireEye, an application also used by the CIA and Pentagon, notified a remote team of security specialists Target had assembled in Bangalore, India, about suspicious network activity on Saturday, Nov. 30. The India-based specialists promptly notified personnel in Target’s Minneapolis headquarters.
Bloomberg quotes anonymous sources at Target as saying the FireEye application successfully detected the uploading of malware into Target’s system, but nothing was done to investigate or respond. In an emailed statement, Target executives told Bloomberg that the retailer is still actively investigating the breach and taking steps to prevent future breaches, and will not comment until all final analysis is complete.
Amazon Prime just got a little more expensive
It’s official. Amazon is raising the membership fee for Prime and Student Prime customers.
The company sent out emails today to Prime and Student Prime consumers letting them know of the new fees. Prime customers will be paying an annual rate of $99 whenever their membership renews — that’s up from $79 per year.
Student Prime consumers will pay $49 a year, up from $39. Students with questions about renewal rates should click here for details.
Amazon has also posted an announcement in its Help & Customer Service page, which also includes links for people who wish to make changes to their membership, including canceling it.
The company pointed out in the emails that went out and on the website that it is the first time it is increasing the price of Prime and Student Prime since introducing the membership program nine years ago.
“Even as fuel and transportation costs have increased, the price of Prime has remained the same for nine years. Since 2005, the number of items eligible for unlimited free two-day shipping has grown from one million to more than 20 million,” the email read.
Current members will still receive all the benefits of Amazon Prime, the company said in its announcement, including unlimited free two-day shipping for eligible purchases, unlimited streaming with Prime Instant Video and the ability to borrow books from the Kindle Owners’ Lending Library.