Total Revenue

+5% " "

Growth in consumables continued to drive sales as customers focused on essentials, while market share gains supported overall revenue despite a weaker discretionary environment. " " However, financial pressures on the core customer (e.g., inflation, higher borrowing costs) moderated traffic trends, limiting further upside. " "

Consumables Revenue

+6% " "

The shift in customer spending toward essentials pushed consumables higher, with increased promotional activity also attracting cost-conscious shoppers. " " Lower-margin consumables thus grew as a proportion of the sales mix, contributing to margin pressure despite top-line gains. " "

SG&A

+10% " "

Higher retail labor costs, partially due to wage investments, and increased utility and store occupancy expenses drove the rise in SG&A. " " These pressures were only partially offset by lower incentive compensation, leading to a greater percentage of sales devoted to operating expenses. " "

Operating Income

-25% " "

Operating income was significantly pressured by lower gross margins and higher SG&A. " " Elevated markdowns, increased shrink, and the sales mix shift to lower-margin consumables further eroded profitability, while incremental labor and maintenance expenses also weighed on operating results. " "

Net Income

-29% " "

Net income declined as rising SG&A, markdown-driven margin pressures, and higher interest costs combined to reduce profitability. " " Though consumables demand remained robust, weaker discretionary spending limited opportunities to offset these cost headwinds, resulting in a notable YoY decrease. " "

Basic EPS

-28% " "

EPS mirrored the drop in net income, reflecting compressed operating margins and continued cost inflation. " " Despite some offset from lower incentive compensation and select cost-reduction efforts, the larger impact of markdowns, shrink, and store-level expense growth drove EPS down considerably. " "

Net Sales Growth

FY 2024

4.7% to 5.3% "

4.8% to 5.1% "

lowered

Same-Store Sales Growth

FY 2024

1.0% to 1.6% "

1.1% to 1.4% "

lowered

EPS

FY 2024

$5.50 to $6.20 "

$5.50 to $5.90 "

lowered

Effective Tax Rate

FY 2024

~23% "

~23% "

no change

Capital Expenditures (CapEx)

FY 2024

$1.3B to $1.4B "

$1.3B to $1.4B "

no change

Real Estate Projects

FY 2024

2,435 (730 new, 1,620 remodels, 85 relocations) "

2,435 (730 new, 1,620 remodels, 85 relocations) "

no change

Hurricane-Related Expenses

FY 2024

no prior guidance

$32.7M negative impact in Q3, $10M in Q4 "

no prior guidance

Gross Margin Pressure

FY 2024

no prior guidance

Expected due to promotional markdowns and shift to consumables "

no prior guidance

Back to Basics initiatives

Key focus across Q2, Q1, and Q4, highlighting operational excellence and positive customer feedback. " " " "

Emphasized continued progress in store execution, supply chain, and turnover reductions. "

Recurring, consistently positive

Efforts to reduce shrink

Major headwind in Q2, Q1, Q4 with multiple mitigation strategies. " " "

29 bps tailwind in Q3, still above target but improving. "

Recurring challenge, showing better results

Market share gains and loss dynamics

Mixed performance in Q2 (didn’t capture fair share), gains in Q1, growth in Q4. " " "

Rebound in Q3, capturing more share among mid- to high-end consumers. "

Recurring, more positive in Q3

Same-day delivery pilot

No mention in Q2, Q1, or Q4.

Launched in ~75 stores, well-received by customers. " "

Newly introduced in Q3

Positive EPS growth outlook

Guidance updates in Q2, Q1, Q4 signaled cautious optimism amid headwinds. " " "

Still targeting double-digit EPS over time, no set timeline. " "

Recurring emphasis, moderate optimism

Gross margin pressure from promotions, consumables mix, wage inflation

Similar drivers of margin compression mentioned in Q2, Q1, Q4. " " "

Promotional activity persisted, consumables mix grew, wage rate pressure ongoing. " " " "

Recurring issue, remains challenging

Hurricane-related expenses impacting guidance

Not discussed in Q2, Q1, or Q4.

$32.7M in Q3, $10M expected in Q4, lowering FY24 EPS. " "

New factor in Q3

Customer traffic trends

Q2 traffic up 1%, Q1 up 4%, Q4 also positive. " " "

Traffic up 0.3%, first positive over a positive compare, end-of-month weakness. " "

Recurring, slight improvement in Q3

Aggressive store expansion and cannibalization rates

Strong new store returns in Q2; no mention in Q1/Q4. "

~4,885 real estate projects planned, stable cannibalization. "

Mentioned again in Q3

Inventory management improvements

Ongoing reductions, SKU rationalization, and improved supply chain in Q2, Q1, Q4. " " "

Total inventory down 3%, non-consumables cut 6%, better in-stocks. " "

Recurring, steady progress

Competition from mass retailers like Walmart

Q2 cited Walmart capturing shared traffic; no Q1/Q4 mention. " "

No mention in Q3.

Mentioned previously, not in Q3

Shift from discretionary items to consumables

Highlighted in Q2, Q1, Q4 as customers prioritize essentials. " " "

Consumables led sales, discretionary soft. " "

Ongoing shift, consistently noted

Mini-market (DG Market) format expansion

Q4 discussed strong IRRs and potential in underserved areas. "

No mention in Q3.

Mentioned in Q4 only

Persistent shrink as a margin headwind

Significant headwind flagged in Q2, Q1, Q4. " " "

Became a 29 bps tailwind, still higher than ideal. " "

Recurring, improving in Q3

Operating margin decline and uncertain timeline for recovery

Negative margin trends in Q2, Q1, Q4 with no clear rebound timeline. " " "

Operating margin at 3.2%, down 129 bps, no firm outlook. " "

Recurring negative trend

EPS guidance volatility

Revisions in Q2 ($5.50–$6.20), Q1 ($6.80–$7.55), Q4 calls. " " " "

Lowered FY24 EPS to $5.50–$5.90 due to hurricane costs. " "

Recurring adjustments reflecting uncertainty