Dollar General cuts annual forecasts as American shoppers turn cautious

[June 01, 2023]  (Reuters) - Dollar General Corp cut its full-year same-store sales and profit forecasts on Thursday as inflation-hit Americans, discouraged by higher prices for everything from home supplies to consumables, tightened spending. 

Dollar General shopping carts are seen outside a store in Mount Rainier, Maryland, U.S., June 1, 2021. REUTERS/Erin Scott

Shares of the company were down about 6% in premarket trading.

American shoppers, economically strained by sticky food inflation, have turned cautious with purchases of discretionary goods and are buying fewer items on every store visit.

The discount store chain expects fiscal 2023 same-store sales to increase in the range of 1% to 2%, compared with its prior outlook of an increase of 3% to 3.5%. Analysts on average were expecting a rise of 3.76%, according to IBES data from Refinitiv.

It expects earnings per share between flat and 8% decline, down from prior forecast of an about 4% to 6% rise.

Its net sales are now expected to grow in the range of about 3.5% to 5.0%, compared to its previous expectation of a 5.5% to 6% rise.

(Reporting by Savyata Mishra in Bengaluru; Editing by Pooja Desai and Dhanya Ann thoppil)

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