• Q4 profit rose 8.2% to $317m
  • Sales climbed 0.5% to $4.21bn
  • Apparel sales down 1.9% to $236.8m

US discount retailer Dollar General has today (25 March) reported an 8.2% increase in fourth-quarter net profit, despite slowing apparel sales. 

Net income reached US$317m for the 13 weeks to 1 February, compared to $293m the same period last year.

Net sales edged up 0.5% to $4.21bn from $4.19bn the prior year, driven from increases in customer traffic and average transaction amount. Same-store sales climbed 3%.

Apparel sales, however, declined 1.9% to $236.8m from $241.4m last year.

Gross margin improved 34 basis points to 32.5% against 32.2%. The company said it was boosted by a significant reduction in the adjustment to its last in first out reserve as well as improved transportation efficiencies and higher markups.

Over the full year, net income jumped 24.3% to $953m, from $767m last year. Sales rose 8.2% to $16.02bn from $14.81bn the previous year, while same-store sales were up 4.7%

"Dollar General had yet another outstanding year in 2012 including exceptionally strong fourth quarter results. We grew our market share and invested strategically to continue to win with our customers. These results demonstrate the strength of our business strategy, and we believe we are very well-positioned for future growth," said chairman and CEO Rick Dreiling.

Looking ahead, Dollar General expects adjusted earnings per share for 2013 to range from $3.15 to $3.30, up from the $2.91 recorded in 2012. Total sales and same store sales are set to increase 10-12% and 4-6% respectively.