Dollar General cautious, but still planning hundreds of new stores

Despite strong third quarter sales and earnings results, Dollar General CEO Rick Dreiling is cautious about the fourth quarter. He says customer spending has been erratic, which indicates uncertainty about the economy.

"It is my belief that our core customers are concerned about their financial outlook, which is resulting in a dynamic that is driving the current competitive environment to be more promotional," said Dreiling.

For the fourth quarter, Dollar General is forecasting modest comparable sales gains, and flat-to-slightly decreased gross profits.

The company has 10,300 stores and plans to add 635 more during fiscal 2013, including 40 Dollar General Plus stores and 20 fresh-grocery Dollar General Market stores.

The Fresh Market reports increases in sales, income

The Fresh Market reported an excellent third quarter yesterday, although analysts had hoped for better results.

• Net income for the quarter grew to $10.9 million, a 19% gain as compared to the same period one year ago.
• Sales reached $321.5 million, a 22.1% gain.
• Income per share was $0.23, compared to analysts expectations of $0.26.
• Year-to-date net income was $43.5 million on sales of $959.3 million. Both figures represent significant increases (31.2% and 21.8%, respectively) compared to the same period a year ago.
• Comparable-store sales were up 5.6% for the quarter and 7.3% year-to-date.

As of the close of business yesterday, The Fresh Market's shares were down 12% since analysts expectations were not met.

Weis Markets 3Q results include higher earnings, lower sales

Weis Markets announced its third quarter earnings recently, which were highlighted by a 1.2% increase in net income to $17.2 million.

In addition:

• Earnings per share increased 1.6% to $0.64 per share as compared to the same period one year ago.
• Operating income increased 1.3% to $26.5 million.
• Sales decreased 1.5% to $668.4 million.
• Comparable store sales decreased 1.7%.

According to the company, net income and operating income increases were due to its continuing focus on disciplined promotions and marketing, increased store-level productivity, improved operational and supply chain efficiencies, and a decrease in depreciation expenses.

The decrease in sales was attributed to spikes in sales in the third quarter of 2011 as a result of Hurricane Irene and Lee. Weis also pointed to higher gas prices as well as cautious consumer spending due to high unemployment in Northeastern Pennsylvania, New York's Southern Tier, and parts of Central Pennsylvania.

For the year-to-date, the company's sales were down 0.4% and comparable store sales were down 0.2% as compared to the same period one year ago. Net income rose 7.3% and operating income rose 7.1%.