Dollar General Corp. (NYSE:DG) shares dipped despite reporting strong sales in the second quarter ended August 4 and revising up its profit guidance for the year.
Net sales increased 8.1% to US$5.83bn in the second quarter compared to US$5.39bn in the corresponding period last year while same-store sales increased 2.6%, driven by increases in average transaction amount and customer traffic.
The company said net income was US$295mln or US$1.08 per diluted share compared to net income of US$307mln or $1.08 per diluted share in the 2016 second quarter.
The company now expects fiscal 2017 diluted earnings per share of US$4.35 to US$4.50 compared with prior guidance of US$4.25 to US$4.50.
Todd Vasos, Dollar General's chief executive officer said: "I am pleased with our results at this point in the year. For the quarter, same-store sales grew 2.6%, driven by an increase in our average transaction amount and, importantly, positive customer traffic. In a dynamic retail and consumer landscape, we continue to make targeted investments in our business to execute on our focused strategic and operating initiatives which we believe will contribute to sustainable improvement over time."
In pre-market deals. the company's shares were down around 7.7% at US$70.51 per share.