Dollar General Q3 income up 21.3%; to open 635 stores in fiscal 2013

Goodlettsville, Tenn. -- Dollar General Corp. on Tuesday posted a bigger-than-expected increase in quarterly profit and total sales in line with Wall Street expectations. But the chain said it remained cautious about the rest of the year, amid heightened pricing competition and

Dollar General said it plans to open approximately 635 stores in fiscal 2013, including some 20 Dollar General Market stores and 40 Dollar General Plus stores. The company also plans to remodel or relocate a total of approximately 550 stores.

Dollar General’s net income in the quarter ended Nov. 2, rose 21.3% to $207.7 million for the quarter, up from $171.2 million in the same quarter a year earlier.

Revenue rose 10.3% to $3.96 billion from the year-earlier quarter. Same-store sales increased 4%, less than the Street expected.

Dollar General delivered another solid quarter, and we expect to continue building on our strong track record of success,” said Rick Dreiling, chairman and CEO. “We had great financial performance across key metrics.”

On a conference call, Dreiling acknowledged that the news about potential federal tax increases and spending cuts after the start of the new year appeared to be impacting customers.

"I think the customer is fatigued, they're tired, they're scared," he said on the call. "Every time you turn on the television, there's a bunch of guys in suit(s) who are frowning, telling you that the world's going to go over the fiscal cliff."

The company is seeing a more pronounced paycheck cycle, with strong sales when at times when shoppers get paychecks and a drop off at other times.