Executive Summary

• Dollar General reported 1Q16 revenues of $5.27 billion, up 7.0% year over year and in line with the consensus estimate. Including a $0.03 benefit from a lower tax rate, EPS was $1.03, beating the consensus estimate of $0.95.
• Comps were up 2.2%, slightly below the consensus of 2.4%. Comps were driven by increases in customer traffic and average transaction value and growth in both consumables and nonconsumables, with consumables growing more strongly.
• For FY16, the company expects an increase of 7%–10% in net sales, to $21.8–$22.4 billion, and an increase of 10%–15% in EPS, to $4.36–$4.55.