08:41 AM EDT, 03/14/2024 (MT Newswires) -- Dollar General ( DG ) on Thursday logged better-than-expected fiscal fourth-quarter results buoyed by improving customer demand, while the discount retailer anticipates annual sales growth for the current fiscal year.

The company's earnings came in at $1.83 a share for the quarter ended Feb. 2, down from $2.96 a year earlier, but ahead of the Capital IQ-polled consensus of $1.73. Sales decreased 3.4% to $9.86 billion, topping the Street's view for $9.78 billion. The stock jumped 4.9% in premarket trading.

Same-store sales moved 0.7% higher, compared with a 1.2% fall modeled by analysts, driven by an increase in customer traffic. This was partially offset by a lower amount in the average transaction. Same-store sales grew in the consumables category, but apparel, home and seasonal products all logged declines, according to the company.

Selling, general and administrative expenses widened to $2.33 billion from $2.22 billion year-over-year. Total merchandise inventories, measured at cost, were $7 billion versus $6.8 billion in the prior-year period.

"We have made solid progress executing on our back to basics strategy, which we believe supported our improved operational performance during the quarter," Chief Executive Todd Vasos said in a statement. "While we are pleased with the operational improvement we have seen, we believe that significant opportunity remains."

For fiscal 2024, the retailer anticipates sales to grow between roughly 6% and 6.7%, while same-store sales are forecast to rise by 2% to 2.7%. The Street is looking for revenue of $40.32 billion and a comparable sales increase of 1.2%. In the just-ended fiscal year, sales rose 2.2% to $38.69 billion, while same-store sales edged up 0.2%.

Per-share profit is pegged at about $6.80 to $7.55 for the current fiscal year, including a negative impact of $0.50 due to higher incentive compensation expense, the company said. The consensus on Capital IQ is for GAAP EPS of $7.52. The retailer reiterated its plans to carry out approximately 2,385 real estate projects in 2024, including opening about 800 new stores.

For the ongoing three-month period, Dollar General ( DG ) expects EPS to be in the range of $1.50 to $1.60, while the Street's current estimate is for $1.91. Same-store sales are projected to incline between 1.5% and 2%, versus analysts' expectations for a 0.2% rise.

The company's first quarter is anticipated to be pressured by its "lowest expected same-store sales increase of any quarter" in fiscal 2024, according to Chief Financial Officer Kelly Dilts. Additionally, the annualization of prior-year headwinds, such as retail labor and shrink, which refers to inventory lost due to theft or internal issues, is predicted to weigh on the period, Dilts said.

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