UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended May 3, 2002
Commission file number 1-11421
DOLLAR GENERAL CORPORATION
(Exact name of registrant as specified in its charter)
Tennessee 61-0502302
----------------------------------------------- ------------------------
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification Number)
100 Mission Ridge
Goodlettsville, Tennessee 37072
--------------------------------------------------
(Address of principal executive offices, zip code)
(615) 855-4000
---------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ].
The number of shares of common stock outstanding as of May 10, 2002 was
332,856,617.
Dollar General Corporation
Form 10-Q
For the Quarter Ended May 3, 2002
Index
Part I. Financial Information Page No.
Item 1. Financial Statements: 3
Condensed Consolidated Balance Sheets as of May 3,
2002 and February 1, 2002 3
Condensed Consolidated Statements of Income for the 13
weeks ended May 3, 2002 and May 4, 2001 4
Condensed Consolidated Statements of Cash Flows for
the 13 weeks ended May 3, 2002 and May 4, 2001 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 15
Item 3. Quantitative and Qualitative Disclosures About Market
Risk 20
Part II. Other Information 20
Item 1. Legal Proceedings 20
Item 4. Submission of Matters to a Vote of Security Holders 23
Item 6. Exhibits and Reports on Form 8-K 24
Signatures 25
2
Part I - Financial Information
Item 1. Financial Statements
DOLLAR GENERAL CORPORATION AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands)
May 3, 2002 February 1, 2002
(Unaudited)
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents ....................... $ 287,424 $ 261,525
Merchandise inventories ......................... 1,134,449 1,131,023
Deferred income taxes ........................... 80,974 105,091
Other current assets ............................ 85,419 58,408
----------- -----------
Total current assets ..................... 1,588,266 1,556,047
----------- -----------
Property and equipment, at cost ................. 1,507,414 1,473,693
Less accumulated depreciation and amortization .. 515,937 484,778
----------- -----------
Net property and equipment ............... 991,477 988,915
----------- -----------
Other assets .................................... 8,989 7,423
----------- -----------
Total assets ............................. $ 2,588,732 $ 2,552,385
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations ........ $ 395,877 $ 395,675
Accounts payable ................................ 341,134 322,463
Accrued expenses and other ...................... 212,590 253,413
Litigation settlement payable ................... 161,000 162,000
----------- -----------
Total current liabilities ................ 1,110,601 1,133,551
----------- -----------
Long-term obligations ............................... 336,083 339,470
Deferred income taxes ............................... 53,388 37,646
Shareholders' equity:
Preferred stock ................................. -- --
Common stock .................................... 166,462 166,359
Additional paid-in capital ...................... 302,200 301,848
Retained earnings ............................... 625,193 579,265
Accumulated other comprehensive loss ............ (2,677) (3,228)
----------- -----------
1,091,178 1,044,244
Less other shareholders' equity ................. 2,518 2,526
----------- -----------
Total shareholders' equity ............... 1,088,660 1,041,718
----------- -----------
Total liabilities and shareholders' equity $ 2,588,732 $ 2,552,385
=========== ===========
See notes to condensed consolidated financial statements.
3
DOLLAR GENERAL CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Income (Unaudited)
(Amounts in thousands except per share amounts)
13 Weeks Ended
-----------------------------------------------------
May 3, % of Net May 4, % of Net
2002 Sales 2001 Sales
---------- ---------- ---------- ----------
Net sales ................................ $1,389,412 100.0% $1,202,504 100.0%
Cost of goods sold ....................... 1,009,120 72.6 881,079 73.3
---------- ----- ---------- -----
Gross profit ....................... 380,292 27.4 321,425 26.7
Selling, general and
administrative expense ............... 297,304 21.4 251,990 20.9
---------- ----- ---------- -----
Operating profit ................... 82,988 6.0 69,435 5.8
Interest expense ......................... 10,432 0.8 11,600 1.0
---------- ----- ---------- -----
Income before income taxes.......... 72,556 5.2 57,835 4.8
Provision for taxes on income ............ 26,628 1.9 21,602 1.8
---------- ----- ---------- -----
Net income ......................... $ 45,928 3.3% $ 36,233 3.0%
========== ===== ========== =====
Earnings per share:
Basic .............................. $ 0.14 $ 0.11
========== ==========
Diluted ............................ $ 0.14 $ 0.11
========== ==========
Weighted average shares:
Basic .............................. 332,665 331,588
========== ==========
Diluted ............................ 334,834 335,184
========== ==========
Dividends per share ...................... $ .032 $ .032
========== ==========
See notes to condensed consolidated financial statements
4
DOLLAR GENERAL CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
13 Weeks Ended
--------------------------
May 3, 2002 May 4, 2001
----------- -----------
Cash flows from operating activities:
Net income $ 45,928 $ 36,233
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 32,004 29,890
Deferred income taxes 39,859 264
Tax benefit from stock option exercises 689 3,258
Change in operating assets and liabilities:
Merchandise inventories (3,426) (9,299)
Other current assets 1,500 6,972
Accounts payable 18,671 (14,702)
Accrued expenses and other (19,775) (15,252)
Income taxes (39,464) 2,676
Other (1,166) (2)
--------- ---------
Net cash provided by operating activities 74,820 40,038
--------- ---------
Cash flows from investing activities:
Purchase of property and equipment (34,812) (35,726)
Proceeds from sale of property and equipment 58 114
--------- ---------
Net cash used in investing activities (34,754) (35,612)
--------- ---------
Cash flows from financing activities:
Repayments of long-term obligations (3,196) (3,048)
Payment of cash dividends (10,646) (10,631)
Proceeds from exercise of stock options 1,374 7,996
Other financing activities (1,699) (159)
--------- ---------
Net cash used in financing activities (14,167) (5,842)
--------- ---------
Net increase (decrease) in cash and cash equivalents 25,899 (1,416)
Cash and cash equivalents, beginning of period 261,525 162,310
--------- ---------
Cash and cash equivalents, end of period $ 287,424 $ 160,894
========= =========
Supplemental schedule of noncash investing and financing activities:
Purchase of property and equipment under capital lease obligations $ -- $ 12,088
========= =========
See notes to condensed consolidated financial statements.
5
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of presentation and accounting policies
Basis of presentation
The accompanying unaudited condensed consolidated financial
statements of the Dollar General Corporation (the "Company") have been prepared
in accordance with generally accepted accounting principles for interim
financial information and are presented in accordance with the requirements of
Form 10-Q and Rule 10-01 of Regulation S-X. Such financial statements
consequently do not include all of the disclosures normally required by
generally accepted accounting principles or those normally made in the Company's
Annual Report on Form 10-K. Accordingly, the reader of this quarterly report on
Form 10-Q should refer to the Company's Annual Report on Form 10-K for the year
ended February 1, 2002 for additional information.
The accompanying condensed consolidated financial statements have
been prepared in accordance with the Company's customary accounting practices
and have not been audited. In management's opinion, all adjustments (which are
of a normal recurring nature) necessary for a fair presentation of the
consolidated results of operations for the 13-week periods ended May 3, 2002 and
May 4, 2001 have been made.
Interim cost of goods sold is determined using ongoing estimates of
inventory shrinkage, inflation, and markdowns. Because the Company's business is
moderately seasonal, the results for interim periods are not necessarily
indicative of the results to be expected for the entire year.
Accounting pronouncements
In June 2001, the Financial Accounting Standards Board (the "FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations," and SFAS No. 142, "Goodwill and Other Intangible Assets." Under
the new rules, goodwill and indefinite lived intangible assets are no longer
amortized but are reviewed annually for impairment. Separable intangible assets
that are not deemed to have an indefinite life will continue to be amortized
over their useful lives. The Company began to apply the new accounting rules on
February 2, 2002. The adoption of SFAS No. 141 and No. 142 has not had a
material impact on the Company's financial position or results of operations.
The FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations" in June 2001. SFAS No. 143 applies to legal obligations associated
with the retirement of certain tangible long-lived assets. This statement is
effective for fiscal years beginning after June 15, 2002. Accordingly, the
Company will adopt this statement on February 1, 2003. The Company believes the
6
adoption of SFAS No. 143 will not have a material impact on the Company's
financial position or results of operations.
In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS No. 144 is effective for
fiscal years beginning after December 15, 2001, and interim periods within those
fiscal years. The Company adopted this statement on February 2, 2002. This
statement addresses financial accounting and reporting for the impairment or
disposal of long-lived assets. It supersedes SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of."
The adoption of SFAS No. 144 has not had a material impact on the Company's
financial position or results of operations.
2. Comprehensive income
Comprehensive income consists of the following (in thousands):
13 Weeks Ended
-------------------------
May 3, 2002 May 4, 2001
----------- -----------
Net income $ 45,928 $ 36,233
Net change in derivative financial instruments 551 (2,839)
-------- --------
$ 46,479 $ 33,394
======== ========
3. Segment reporting
The Company manages its business on the basis of one reportable
segment. As of May 3, 2002 and May 4, 2001, all of the Company's operations were
located within the United States. The following data is presented in accordance
with SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information." The following amounts are in thousands:
13 Weeks Ended
-------------------------
May 3, 2002 May 4, 2001
----------- -----------
Sales by category:
Highly consumable ...... $ 851,236 $ 721,292
Hardware and seasonal... 204,763 168,804
Basic clothing ......... 142,301 130,632
Home products .......... 191,112 181,776
---------- ----------
$1,389,412 $1,202,504
========== ==========
7
4. Guarantor subsidiaries
All of the Company's subsidiaries (the "Guarantors") have fully and
unconditionally guaranteed on a joint and several basis the Company's
obligations under certain outstanding notes payable. Each of the Guarantors is a
wholly-owned subsidiary of the Company. The Guarantors comprise all of the
direct and indirect subsidiaries of the Company.
In order to participate as a subsidiary guarantor on certain of the
Company's financing arrangements, a subsidiary of the Company has entered into a
letter agreement with certain state regulatory agencies to maintain
stockholders' equity of at least $250 million.
Condensed combined financial information for the Guarantors is set
forth below. Dollar amounts are in thousands.
8
May 3, 2002
-------------------------------------------------------------------
DOLLAR
GENERAL GUARANTOR CONSOLIDATED
CORPORATION SUBSIDIARIES ELIMINATIONS TOTAL
----------- ------------ ------------ ------------
BALANCE SHEET DATA:
ASSETS
Current assets
Cash and cash equivalents $ 243,961 $ 43,463 $ -- $ 287,424
Merchandise inventories -- 1,134,449 -- 1,134,449
Deferred income taxes 71,501 9,473 -- 80,974
Other current assets 18,938 1,013,312 (946,831) 85,419
----------- ----------- ----------- -----------
Total current assets 334,400 2,200,697 (946,831) 1,588,266
----------- ----------- ----------- -----------
Property and equipment, at cost 161,358 1,346,056 -- 1,507,414
Less accumulated depreciation
and amortization 55,862 460,075 -- 515,937
----------- ----------- ----------- -----------
Net property and equipment 105,496 885,981 -- 991,477
----------- ----------- ----------- -----------
Other assets 2,171,663 3,337 (2,166,011) 8,989
----------- ----------- ----------- -----------
Total assets $ 2,611,559 $ 3,090,015 $(3,112,842) $ 2,588,732
=========== =========== =========== ===========
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations $ 65,622 $ 330,255 $ -- $ 395,877
Accounts payable 1,032,607 255,358 (946,831) 341,134
Accrued expenses and other 55,962 156,628 -- 212,590
Litigation settlement payable 161,000 -- -- 161,000
----------- ----------- ----------- -----------
Total current liabilities 1,315,191 742,241 (946,831) 1,110,601
----------- ----------- ----------- -----------
Long-term obligations 200,569 873,837 (738,323) 336,083
----------- ----------- ----------- -----------
Deferred income taxes 7,139 46,249 -- 53,388
----------- ----------- ----------- -----------
Shareholders' equity:
Preferred stock -- -- -- --
Common stock 166,462 23,853 (23,853) 166,462
Additional paid-in capital 302,200 929,679 (929,679) 302,200
Retained earnings 625,193 474,156 (474,156) 625,193
Accumulated other comprehensive
loss (2,677) -- -- (2,677)
----------- ----------- ----------- -----------
1,091,178 1,427,688 (1,427,688) 1,091,178
Less other shareholders' equity 2,518 -- -- 2,518
----------- ----------- ----------- -----------
Total shareholders' equity 1,088,660 1,427,688 (1,427,688) 1,088,660
----------- ----------- ----------- -----------
Total liabilities and shareholders' equity $ 2,611,559 $ 3,090,015 $(3,112,842) $ 2,588,732
=========== =========== =========== ===========
9
February 1, 2002
-------------------------------------------------------------------
DOLLAR
GENERAL GUARANTOR CONSOLIDATED
CORPORATION SUBSIDIARIES ELIMINATIONS TOTAL
----------- ------------ ------------ ------------
BALANCE SHEET DATA:
ASSETS
Current assets
Cash and cash equivalents $ 217,539 $ 43,986 $ -- $ 261,525
Merchandise inventories -- 1,131,023 -- 1,131,023
Deferred income taxes 79,203 25,888 -- 105,091
Other current assets 15,406 913,082 (870,080) 58,408
----------- ----------- ----------- -----------
Total current assets 312,148 2,113,979 (870,080) 1,556,047
----------- ----------- ----------- -----------
Property and equipment, at cost 158,347 1,315,346 -- 1,473,693
Less accumulated depreciation
and amortization 51,832 432,946 -- 484,778
----------- ----------- ----------- -----------
Net property and equipment 106,515 882,400 -- 988,915
----------- ----------- ----------- -----------
Other assets 2,079,572 2,022 (2,074,171) 7,423
----------- ----------- ----------- -----------
Total assets $ 2,498,235 $ 2,998,401 $(2,944,251) $ 2,552,385
=========== =========== =========== ===========
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations $ 65,682 $ 329,993 $ -- $ 395,675
Accounts payable 944,830 247,713 (870,080) 322,463
Accrued expenses and other 76,526 176,887 -- 253,413
Litigation settlement payable 162,000 -- -- 162,000
----------- ----------- ----------- -----------
Total current liabilities 1,249,038 754,593 (870,080) 1,133,551
----------- ----------- ----------- -----------
Long-term obligations 200,460 830,881 (691,871) 339,470
----------- ----------- ----------- -----------
Deferred income taxes 7,019 30,627 -- 37,646
----------- ----------- ----------- -----------
Shareholders' equity:
Preferred stock -- -- -- --
Common stock 166,359 23,853 (23,853) 166,359
Additional paid-in capital 301,848 929,680 (929,680) 301,848
Retained earnings 579,265 428,767 (428,767) 579,265
Accumulated other comprehensive loss (3,228) -- -- (3,228)
----------- ----------- ----------- -----------
1,044,244 1,382,300 (1,382,300) 1,044,244
Less other shareholders' equity 2,526 -- -- 2,526
----------- ----------- ----------- -----------
Total shareholders' equity 1,041,718 1,382,300 (1,382,300) 1,041,718
----------- ----------- ----------- -----------
Total liabilities and shareholders' equity $ 2,498,235 $ 2,998,401 $(2,944,251) $ 2,552,385
=========== =========== =========== ===========
10
Quarter to Date and Year to Date
-------------------------------------------------------------------
May 3, 2002
-------------------------------------------------------------------
DOLLAR
GENERAL GUARANTOR CONSOLIDATED
CORPORATION SUBSIDIARIES ELIMINATIONS TOTAL
----------- ------------ ------------ ------------
STATEMENTS OF INCOME DATA:
Net sales $ 46,452 $1,389,412 $ (46,452) $1,389,412
Cost of goods sold -- 1,009,120 -- 1,009,120
---------- ---------- ---------- ----------
Gross profit 46,452 380,292 (46,452) 380,292
Selling, general and administrative 41,561 302,195 (46,452) 297,304
---------- ---------- ---------- ----------
Operating profit 4,891 78,097 -- 82,988
Interest expense 4,004 6,428 -- 10,432
---------- ---------- ---------- ----------
Income before income taxes 887 71,669 -- 72,556
Less provision for taxes on income 348 26,280 -- 26,628
Equity in subsidiaries' earnings, net 45,389 -- (45,389) --
---------- ---------- ---------- ----------
Net income $ 45,928 $ 45,389 $ (45,389) $ 45,928
========== ========== ========== ==========
Quarter to Date and Year to Date
-------------------------------------------------------------------
May 4, 2001
-------------------------------------------------------------------
DOLLAR
GENERAL GUARANTOR CONSOLIDATED
CORPORATION SUBSIDIARIES ELIMINATIONS TOTAL
----------- ------------ ------------ ------------
STATEMENTS OF INCOME DATA:
Net sales $ 35,843 $1,202,504 $ (35,843) $1,202,504
Cost of goods sold -- 881,079 -- 881,079
---------- ---------- ---------- ----------
Gross profit 35,843 321,425 (35,843) 321,425
Selling, general and administrative 30,079 257,754 (35,843) 251,990
---------- ---------- ---------- ----------
Operating profit 5,764 63,671 -- 69,435
Interest expense 4,623 6,977 -- 11,600
---------- ---------- ---------- ----------
Income before income taxes 1,141 56,694 -- 57,835
Less provision for taxes on income 426 21,176 -- 21,602
Equity in subsidiaries' earnings, net 35,518 -- (35,518) --
---------- ---------- ---------- ----------
Net income $ 36,233 $ 35,518 $ (35,518) $ 36,233
========== ========== ========== ==========
11
For the 13 weeks ended
-------------------------------------------------------------------
May 3, 2002
-------------------------------------------------------------------
DOLLAR
GENERAL GUARANTOR CONSOLIDATED
CORPORATION SUBSIDIARIES ELIMINATIONS TOTAL
----------- ------------ ------------ ------------
STATEMENTS OF CASH FLOWS DATA:
Cash flows from operating activities:
Net income $ 45,928 $ 45,389 $ (45,389) $ 45,928
Adjustments to reconcile net income to net cash
provided by / (used in) operating activities:
Depreciation and amortization 4,270 27,734 -- 32,004
Deferred income taxes 7,822 32,037 -- 39,859
Tax benefit from stock options exercises 689 -- -- 689
Change in operating assets and liabilities:
Merchandise inventories -- (3,426) -- (3,426)
Other current assets (7,567) (72,003) 81,070 1,500
Accounts payable 87,778 11,963 (81,070) 18,671
Accrued expenses and other (1,082) (18,693) -- (19,775)
Income taxes (9,388) (30,076) -- (39,464)
Other (41,703) (4,852) 45,389 (1,166)
--------- --------- --------- ---------
Net cash provided by/ (used in) operating
activities 86,747 (11,927) -- 74,820
--------- --------- --------- ---------
Cash flows from investing activities:
Purchases of property and equipment (2,941) (31,871) -- (34,812)
Proceeds from sale of property and equipment 1 57 -- 58
Issuance of long-term notes receivable (46,452) -- 46,452 --
--------- --------- --------- ---------
Net cash used in investing activities (49,392) (31,814) 46,452 (34,754)
--------- --------- --------- ---------
Cash flows from financing activities:
Repayments of long-term obligations 38 (3,234) -- (3,196)
Payment of cash dividends (10,646) -- -- (10,646)
Proceeds from exercise of stock options 1,374 -- -- 1,374
Other financing activities (1,699) 46,452 (46,452) (1,699)
--------- --------- --------- ---------
Net cash provided by (used in) financing
activities (10,933) 43,218 (46,452) (14,167)
--------- --------- --------- ---------
Net increase (decrease) in cash and cash equivalents 26,422 (523) -- 25,899
Cash and cash equivalents, beginning of period 217,539 43,986 -- 261,525
--------- --------- --------- ---------
Cash and cash equivalents, end of period $ 243,961 $ 43,463 $ -- $ 287,424
========= ========= ========= =========
12
For the 13 weeks ended
-------------------------------------------------------------------
May 4, 2001
-------------------------------------------------------------------
DOLLAR
GENERAL GUARANTOR CONSOLIDATED
CORPORATION SUBSIDIARIES ELIMINATIONS TOTAL
----------- ------------ ------------ ------------
STATEMENTS OF CASH FLOWS DATA:
Cash flows from operating activities:
Net income $ 36,233 $ 35,518 $ (35,518) $ 36,233
Adjustments to reconcile net income to net cash
provided by / (used in) operating activities:
Depreciation and amortization 3,338 26,552 -- 29,890
Deferred income taxes (15) 279 -- 264
Tax benefit from stock options exercises 3,258 -- -- 3,258
Change in operating assets and liabilities:
Merchandise inventories -- (9,299) -- (9,299)
Other current assets 843 49,045 (42,916) 6,972
Accounts payable 23,079 (80,697) 42,916 (14,702)
Accrued expenses and other 3,157 (18,409) -- (15,252)
Income taxes 723 1,953 -- 2,676
Other (29,126) (6,394) 35,518 (2)
--------- --------- --------- ---------
Net cash provided by (used in) operating
activities 41,490 (1,452) -- 40,038
--------- --------- --------- ---------
Cash flows from investing activities:
Purchases of property and equipment (3,706) (32,020) -- (35,726)
Proceeds from sale of property and equipment 15 99 -- 114
Issuance of long-term notes receivable (35,843) -- 35,843 --
Other 2,047 -- (2,047) --
--------- --------- --------- ---------
Net cash used in investing activities (37,487) (31,921) 33,796 (35,612)
--------- --------- --------- ---------
Cash flows from financing activities:
Repayments of long-term obligations (438) (2,610) -- (3,048)
Payment of cash dividends (10,631) -- -- (10,631)
Proceeds from exercise of stock options 7,996 -- -- 7,996
Other financing activities (159) 33,796 (33,796) (159)
--------- --------- --------- ---------
Net cash provided by (used in) financing
activities (3,232) 31,186 (33,796) (5,842)
--------- --------- --------- ---------
Net increase (decrease) in cash and cash equivalents 771 (2,187) -- (1,416)
Cash and cash equivalents, beginning of period 120,643 41,667 -- 162,310
--------- --------- --------- ---------
Cash and cash equivalents, end of period $ 121,414 $ 39,480 $ -- $ 160,894
========= ========= ========= =========
5. Commitments and Contingencies
As disclosed in further detail in the Company's Form 10-K for the
2001 fiscal year, on April 30, 2001, the Company announced that it had become
aware of certain accounting issues that would cause it to restate its audited
financial statements for fiscal years 1999 and 1998, and to restate the
unaudited financial information for fiscal year 2000 that had been previously
released by the Company. The Company subsequently restated such financial
statements and financial information by means of its Form 10-K for the fiscal
year ended February 2, 2001, which was filed on January 14, 2002.
Following the April 30, 2001 announcement, more than 20 purported
class action lawsuits were filed against the Company and certain current and
former officers and directors of the Company, asserting claims under the federal
securities laws relating to the restatement of the Company's financial
13
statements. The Company has reached a settlement agreement with the purported
class action plaintiffs, which agreement was amended following the completion of
confirmatory discovery and was approved by the court on May 24, 2002. Pursuant
to such agreement, the Company has agreed to pay $162 million to such plaintiffs
in settlement for their claims and to implement certain enhancements to its
corporate governance and internal control procedures.
The Company recognized an expense of $162 million in the fourth
quarter of 2000 in respect of the class action settlement agreement. Pursuant to
the terms of such agreement, the Company disbursed $1 million of such funds in
April, 2002. The Company expects to disburse the remaining amount of $161
million in June or July, 2002, provided that all rights to appeal such agreement
have expired and that no appeals have been filed as of such date. The Company
expects to receive from its insurers approximately $4.5 million in respect of
such settlement, which amount has not been accrued in the Company's financial
statements.
In addition, six purported shareholder derivative lawsuits have been
filed in Tennessee state court against certain current and former Company
directors and officers and Deloitte & Touche LLP, the Company's former
independent accountant, and two purported shareholder derivative lawsuits have
been filed in the United States District Court for the Middle District of
Tennessee, which lawsuits seek damages and other relief. The Company and the
individual defendants have reached a settlement agreement with counsel to the
lead plaintiffs in the lead Tennessee state shareholder derivative action, and
the Company anticipates that pursuant to such agreement the other shareholder
derivative actions, which have been stayed, will be dismissed with prejudice.
Such settlement agreement was approved by the court on June 4, 2002. Provided
that all rights to appeal such settlement agreement have expired and that no
appeals have been filed, the Company expects that this agreement will result in
a net payment to the Company by July 17, 2002, after attorneys' fees payable to
the plaintiffs' counsel, of approximately $24.8 million, which has not been
accrued in the Company's financial statements.
These cases were at an early stage prior to the parties' execution of
the settlement agreements, and the amount of potential loss, if any, should the
settlement agreements not become effective cannot be reasonably estimated. An
unfavorable outcome for the Company in these actions could have a material
adverse impact on the Company's financial position and results of operations. In
addition, plaintiffs representing fewer than 1% of the shares traded during the
class period chose to opt out of the class settlement and may elect to pursue
recovery against the Company individually. Because no separate litigation has
yet been filed by parties who opted out, the Company cannot estimate the
potential liabilities associated with such litigation, but it does not believe
that the resolution of any such litigation will have a material effect on the
Company's financial position.
14
The Company has been notified that the Securities and Exchange
Commission ("SEC") is conducting an investigation into the circumstances that
gave rise to the Company's April 30, 2001 announcement. The Company is
cooperating with this investigation by providing documents and other information
to the SEC. At this time, the Company is unable to predict the outcome of this
investigation and the ultimate effects on the Company.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The following text contains references to years 2002, 2001, 2000 and
1999, which represent fiscal years of the Dollar General Corporation (the
"Company") ending or ended January 31, 2003, February 1, 2002, February 2, 2001
and January 28, 2000, respectively. This discussion and analysis should be read
in conjunction with, and is qualified in its entirety by, the consolidated
financial statements and the notes thereto.
Results of Operations -- 13 Weeks Ended May 3, 2002 and May 4, 2001
The nature of the Company's business is modestly seasonal.
Historically, sales in the fourth quarter have been higher than sales achieved
in each of the first three quarters of the fiscal year. Expenses, and to a
greater extent operating income, vary by quarter. Results of a period shorter
than a full year may therefore not be indicative of results expected for the
entire year. Furthermore, comparing any period with a period other than the same
period of the previous year may reflect the seasonal nature of the Company's
business.
Net Sales. Net sales for the first 13 weeks of 2002 were $1.39
billion as compared against $1.20 billion during the first 13 weeks of 2001, an
increase of 15.5%. The increase resulted primarily from 535 net new stores and a
same store sales increase of 6.7%. Same store sales increases are calculated
based on the comparable calendar weeks in the prior year. Same-store sales
calculations include only those stores that were open both at the end of a
fiscal period and at the beginning of the preceding fiscal period. Net sales
increases by category during the period were as follows: highly consumable
18.0%, hardware and seasonal 21.3%, basic clothing 8.9%, and home products 5.1%.
The Company's strong performance in the hardware and seasonal category was due
in part to increased sales generated by new outdoor items added to the product
mix including, but not limited to, lawn statues, stepping stones, and
inspirational garden stones. The Company also generated additional seasonal
sales by shipping warm weather products to its stores earlier than in prior
years, which resulted in greater sales due to the fact that these products were
in the stores for a longer period of time.
Gross Profit. Gross profit during the current year period was $380.3
million, or 27.4% of sales, versus $321.4 million, or 26.7% of sales during the
15
comparable period in the prior year, an increase of 18.3%. The approximately 70
basis point increase in the gross margin rate as a percentage of sales was due
principally to a 67 basis point reduction in distribution and transportation
costs as a percentage of sales and a higher mark-up percentage on the Company's
total inventory balance than that experienced during the comparable period in
the prior year. The reduction in distribution and transportation costs as a
percentage of net sales during the first quarter is due to a relatively modest
increase in these expenses during a period of increased sales. Factors
contributing to this result included a reduction in the Company's average
delivery miles per store due in part to the opening of the Zanesville, Ohio
distribution center, and lower fuel costs relative to the first quarter of the
prior year. The higher mark-up percentage on the Company's inventories is
primarily a result of a lower than normal mark-up on the Company's inventory
balance in the first quarter of 2001 due to the ongoing impact of the markdown
on certain excess inventories taken during the fourth quarter of 2000. As noted
in Item 7 of the Company's Annual Report on Form 10-K for the 2001 fiscal year,
the Company utilizes the retail method of accounting for inventories. Because
the retail method is an averaging process, the mathematical impact of this
markdown on the Company's blended inventory mark-up will diminish with the
passage of time.
Selling, General & Administrative Expenses ("SG&A"). SG&A expenses
during the current year period were $297.3 million, or 21.4% of sales, versus
$252.0 million, or 20.9% of sales during the comparable period in the prior
year, an increase of 18.0%. The increase can be attributed to a 10.3% increase
in store count as compared to the prior year, $5.3 million in expenses incurred
during the current year period related to the Company's restatement of certain
of its financial statements (see Part II, Item 1) versus $0.3 million in such
expenses incurred during the prior year period, and an increase in store labor
costs that was greater than the Company's sales increase. The increase in store
labor costs reflects various actions taken to improve store conditions,
including increasing labor hours and improving employee wages. Excluding the
restatement-related expenses, SG&A would have been $292.0 million, or 21.0% of
sales, in the current year period versus $251.7 million, or 20.9% of sales, in
the prior year period, an increase of 16.0%.
Interest Expense. Interest expense during the current year period was
$10.4 million, or 0.8% of sales, versus $11.6 million, or 1.0% of sales during
the comparable period in the prior year, a decrease of 10.1%. The decrease in
interest expense was due primarily to lower interest rates in the current year
period on the Company's variable rate debt.
Provision for Taxes on Income. The Company's effective tax rate was
36.7% in the current year period versus 37.4% during the comparable period in
the prior year. The reduction in the Company's effective tax rate was due
principally to the implementation of a tax planning strategy in the fourth
quarter of 2001.
16
Net Income. Net income during the current year period was $45.9
million, or 3.3% of sales, compared to $36.2 million, or 3.0% of sales, during
the comparable period in the prior year, an increase of 26.8%. Diluted earnings
per share were $0.14 in the current year period versus $0.11 in the prior year.
Liquidity and Capital Resources
Current Financial Condition / Recent Developments. At May 3, 2002,
the Company's total debt (including current maturities and short-term
borrowings) was $732.0 million, and the Company had $287.4 million of cash and
equivalents and $1.1 billion of shareholders' equity, compared to $735.1 million
of total debt, $261.5 million of cash and equivalents and $1.0 billion of
shareholders' equity at February 1, 2002.
As of May 3, 2002, the Company had $383 million outstanding under two
synthetic lease facilities (the "Synthetic Lease Facilities"), one with $212
million in outstanding capital leases and the other with $171 million in
outstanding capital leases. As of such date, the Company also had a $175 million
revolving credit agreement (the "Current Credit Facility"), under which no
amounts were outstanding. The Synthetic Lease Facilities will mature and the
Current Credit Facility will expire in September 2002.
On March 18, 2002, the Company entered into a commitment letter (the
"Commitment Letter") with SunTrust Bank and SunTrust Capital Markets, pursuant
to which SunTrust Bank has agreed to serve as the sole agent and SunTrust
Capital Markets has agreed to serve as the lead arranger and book manager for
$450 million in new revolving credit facilities (the "New Credit Facilities").
The Company intends to use the New Credit Facilities (i) to replace the Current
Credit Facility, (ii) to refinance the Synthetic Lease Facilities and (iii) for
working capital and other general corporate purposes. The New Credit Facilities
are split between a $300 million three-year revolving credit facility, and a
$150 million 364-day revolving credit facility. The Company will pay interest on
funds borrowed under the New Credit Facilities at rates that are subject to
change based upon the rating of the Company's senior debt by independent
agencies. At the Company's current ratings, the facility fees would be 37.5
basis points and 32.5 basis points on the two facilities, respectively, with an
all-in drawn margin of LIBOR plus 237.5 basis points. The New Credit Facilities
will be secured by the same real estate assets that currently serve as
collateral for the Synthetic Lease Facilities. The availability of funding under
the New Credit Facilities is subject to the negotiation of final documents and
other conditions set forth in the Commitment Letter, which is filed as an
exhibit hereto. The Company expects the New Credit Facilities to be finalized by
the end of June, 2002, and in any event before the Synthetic Lease Facilities
mature and the Current Credit Facility expires, although there can be no
assurance that this will be the case.
17
On April 10, 2002, Moody's Investors Service announced that it had
lowered its ratings on the Company's outstanding public debt to Ba2. On April
12, 2002, Standard and Poor's announced that it had lowered its ratings on the
Company's outstanding public debt to BB+. These ratings downgrades increased the
pricing spread over LIBOR paid by the Company under the synthetic lease facility
with $212 million in outstanding capital leases. At the Company's current
ratings, borrowings under such facility are priced at LIBOR plus 140 basis
points, with an all-in drawn margin (including facility fees) of LIBOR plus 180
basis points.
The Company has $200 million (principal amount) of 8 5/8% unsecured
notes due June 15, 2010. Interest on the notes is payable semi-annually on June
15 and December 15 of each year. The holders of the notes may elect to have
their notes repaid on June 15, 2005, at 100% of the principal amount plus
accrued and unpaid interest.
The Company is currently in discussions with the debt and equity
parties with respect to the Company's leases of its distribution centers at
Indianola, Mississippi and Fulton, Missouri, relating to an alleged default
arising under those leases from the restatement of certain of the Company's
financial statements as further described in Part II, Item 1 of this Form 10-Q.
The Company reached agreement with the debt parties on those leases to
incorporate certain amendments in the debt instruments relating to such
properties, but the equity parties objected to such proposed amendments. The
Company is now exploring other possible changes to address the concerns of the
debt and equity parties, and expects that this matter will be resolved without
any material adverse effect to the Company.
As further described in Part II, Item 1 of this Form 10-Q, and
subject to the contingencies set forth therein, the Company expects to disburse
in June or July of the current year approximately $161 million in final
settlement of the class action lawsuits filed against the Company as a result of
the restatement of the Company's financial statements. The Company expects to
fund this amount from existing cash balances.
The Company believes that its existing cash balances, cash flow from
operations, insurance proceeds expected in connection with the settlement of the
class action and derivative lawsuits filed against the Company as a result of
the restatement of the Company's financial statements, and its ongoing access to
the capital markets (including the New Credit Facilities) will provide
sufficient financing to meet the Company's currently foreseeable liquidity and
capital resource needs.
Cash flows provided by operating activities. Net cash provided by
operating activities totaled $74.8 million during the first 13 weeks of 2002, as
compared to a $40.0 million source of cash during the comparable period in the
prior year. The primary source of this cash in 2002 was the Company's net income
plus depreciation and amortization expense, which together totaled $77.9
million. Another significant source of cash in the current year period was an
18
increase in accounts payable of $18.7 million due primarily to increased trade
payables of $8.7 million and an increase in checks outstanding that have not yet
been presented for payment of $13.4 million. The payment of the Company's
management and store bonuses for the 2001 fiscal year, which was the principal
factor resulting in a decrease in accrued expenses of $19.8 million was a
significant use of cash during the period.
The primary source of net cash from operating activities during the
prior year period was the Company's net income plus depreciation and
amortization expense, which together totaled $66.1 million during the prior year
period. Decreases in accounts payable and accrued expenses and an increase in
merchandise inventories were uses of cash during the prior year period of $14.7
million, $15.3 million and $9.3 million, respectively. The decrease in accounts
payable during the prior year period was attributable primarily to a decrease in
checks outstanding that had not yet been presented for payment of $16.6 million.
The primary component of the decrease in accrued expenses was a decrease in
accrued bonuses of $15.8 million reflecting the payment of store bonuses for the
2000 fiscal year. The increase in inventories reflected primarily the net
addition of 196 stores during the period.
Cash flows used in investing activities. Net cash used in investing
activities during the first 13 weeks of 2002 totaled $34.8 million, as compared
to a $35.6 million use of cash during the comparable period in the prior year.
The $34.8 million spent in the current year period consisted primarily of $8.8
million for new stores, $9.9 million for various store-related technology
projects and $9.5 million for distribution and transportation expenditures. The
$35.6 million spent in the prior year period consisted primarily of $15.4
million for new stores and relocations and $16.0 million for various
store-related fixtures.
Cash flows used in financing activities. Net cash used in financing
activities during the first 13 weeks of 2002 was $14.2 million, which consisted
principally of $10.6 million in dividends and $3.2 million of debt repayments.
Net cash used in financing activities during the comparable period in the prior
year was $5.8 million, which consisted principally of $10.6 million in dividends
and $3.0 million in debt repayments offset by $8.0 million in proceeds from
stock options exercised.
Forward-Looking Statements
This discussion and analysis contains historical and forward-looking
information. The forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. The Company
believes the assumptions underlying these forward-looking statements are
reasonable; however, any of the assumptions could be inaccurate, and therefore,
actual results may differ materially from those projected in the forward-looking
statements as a result of certain risks and uncertainties. These risks include,
19
but are not limited to, those set forth under Item 7 in the Company's Annual
Report on Form 10-K for the fiscal year ended February 1, 2002.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We have no material changes to the disclosures relating to this item
that are set forth in our report on Form 10-K for the fiscal year ended February
1, 2002.
Part II - Other Information
Item 1. Legal Proceedings
Restatement-Related Proceedings
On April 30, 2001, the Company announced that it had become aware of
certain accounting issues that would cause it to restate its audited financial
statements for fiscal years 1999 and 1998, and to restate the unaudited
financial information for fiscal year 2000 that had been previously released by
the Company. The Company subsequently restated such financial statements and
financial information by means of its Form 10-K for the fiscal year ended
February 2, 2001, which was filed on January 14, 2002.
Following the April 30, 2001, announcement more than 20 purported
class action lawsuits were filed against the Company and certain current and
former officers and directors of the Company, asserting claims under the federal
securities laws. These lawsuits have been consolidated into a single action
pending in the United States District Court for the Middle District of
Tennessee. On July 17, 2001, the court entered an order appointing the Florida
State Board of Administration and the Teachers' Retirement System of Louisiana
as lead plaintiffs and the law firms of Entwistle & Cappucci LLP, Milberg Weiss
Bershad Hynes & Lerach LLP and Grant & Eisenhofer, P.A. as co-lead counsel. On
January 3, 2002, the lead plaintiffs filed an amended consolidated class action
complaint. Among other things, plaintiffs have alleged that the Company and
certain of its current and former officers and directors made misrepresentations
concerning the Company's financial results in the Company's filings with the
Securities and Exchange Commission and in various press releases and other
public statements. The plaintiffs seek damages with interest, costs and such
other relief as the court deems proper.
On January 3, 2002, the Company reached a settlement agreement with
the putative class action plaintiffs, pursuant to which the Company agreed to
pay at least $140 million to such plaintiffs in settlement for their claims and
to implement certain enhancements to its corporate governance and internal
control procedures. Such agreement was subject to confirmatory discovery, to the
final approval of the Company's Board of Directors, and to court approval. Under
such settlement agreement, the plaintiffs had the right, following the
completion of confirmatory discovery, to amend their complaint and to negotiate
20
with the Company for additional damages, the aggregate amount of all damages to
be paid in settlement of plaintiffs' claims not to exceed $162 million.
On April 1, 2002, following the completion of such confirmatory
discovery, the Company and the putative class action plaintiffs amended their
settlement agreement and the plaintiffs filed a second amended complaint,
purporting to name as plaintiffs a class of persons who purchased or otherwise
made an investment decision regarding the Company's securities and related
derivative securities between March 5, 1997 and January 14, 2002. Pursuant to
the amended settlement agreement, the Company has agreed to pay $162 million to
such plaintiffs in settlement for their claims and to implement certain
enhancements to its corporate governance and internal control procedures. Such
amended agreement was approved by the court on May 24, 2002.
The Company recognized an expense of $162 million in the fourth
quarter of 2000 in respect of the class action settlement agreement. Pursuant to
the terms of such agreement, the Company disbursed $1 million of such funds in
April, 2002. The Company expects to disburse the remaining amount of $161
million in June or July, 2002, provided that all rights to appeal such agreement
have expired and that no appeals have been filed as of such date. The Company
expects to receive from its insurers approximately $4.5 million in respect of
such settlement, which amount has not been accrued in the Company's financial
statements.
In addition, six purported shareholder derivative lawsuits have been
filed in Tennessee State Court against certain current and former Company
directors and officers and Deloitte & Touche LLP, the Company's former
independent accountant. The Company is named as a nominal defendant in the
actions, which seek restitution and/or compensatory and punitive damages with
interest, equitable and/or injunctive relief, costs and such further relief as
the court deems proper. By order entered October 31, 2001, the court appointed
Michael Dixon, Jr., Carolinas Electrical Workers Retirement Fund and Thomas
Dewey, plaintiffs in one of the six filed cases, as lead plaintiffs and the law
firms of Branstetter, Kilgore Stranch & Jennings and Stanley, Mandel & Iola as
lead counsel. In the same order, the court stayed the remaining cases pending
completion of the lead case. Among other things, the plaintiffs allege that
certain current and former Company directors and officers breached their
fiduciary duties to the Company and that Deloitte & Touche aided and abetted
those breaches and was negligent in its service as the Company's independent
accountant. During August and September 2001, the Company moved to dismiss all
six cases for failure to make a pre-suit demand on the Board of Directors and,
in the alternative, requested that the court stay the actions pending the
completion of an investigation into the allegations in the complaints by the
Shareholder Derivative Claim Review Committee of the Company's Board of
Directors. The lead plaintiffs filed an opposition to this motion on October 2,
2001.
21
Two purported shareholder derivative lawsuits also have been filed in
the United States District Court for the Middle District of Tennessee against
certain current and former Company directors and officers alleging that they
breached their fiduciary duties to the Company. The Company is named as a
nominal defendant in these actions, which seek declaratory relief, compensatory
and punitive damages, costs and such further relief as the court deems proper.
By motion filed on September 28, 2001, the Company requested that the federal
court abstain from exercising jurisdiction over the purported shareholder
derivative actions in deference to the pending state court actions. By agreement
of the parties and court order dated December 3, 2001, the case has been stayed
until June 3, 2002.
The Company and the individual defendants have reached a settlement
agreement with lead counsel to the plaintiffs in the lead Tennessee state
shareholder derivative action. The agreement includes a payment to the Company
from a portion of the proceeds of the Company's director and officer liability
insurance policies as well as certain corporate governance and internal control
enhancements. Pursuant to the terms of such agreement, the Company anticipates
that all of the stayed cases, including the federal derivative cases described
above, will be dismissed with prejudice by the courts in which they are pending.
Following confirmatory discovery, the settlement agreement was preliminarily
approved by the Tennessee state court on April 19, 2002, and received final
approval, subject to any appeal that may be filed, on June 4, 2002.
Provided that all rights to appeal such settlement agreement have
expired and that no appeals have been filed, the Company expects that this
agreement will result in a net payment to the Company by July 17, 2002, after
attorneys' fees payable to the plaintiffs' counsel, of approximately $24.8
million, which has not been accrued in the Company's financial statements.
The Company believes that it has substantial defenses to the
purported class action and the derivative lawsuits and intends to assert these
defenses in the courts in which the actions are pending in the event the
settlement agreements referred to above do not successfully resolve these
matters. These cases were at an early stage prior to the parties' execution of
the settlement agreements, and the amount of potential loss, if any, should the
settlement agreements not become effective cannot be reasonably estimated. An
unfavorable outcome for the Company in these actions could have a material
adverse impact on the Company's financial position and results of operations. In
addition, plaintiffs representing fewer than 1% of the shares traded during the
class period chose to opt out of the class settlement and may elect to pursue
recovery against the Company individually. Because no separate litigation has
yet been filed by parties who opted out, the Company cannot estimate the
potential liabilities associated with such litigation, but it does not believe
that the resolution of any such litigation will have a material effect on the
Company's financial position.
22
The Company has been notified that the SEC is conducting an
investigation into the circumstances that gave rise to the Company's April 30,
2001, announcement. The Company is cooperating with this investigation by
providing documents and other information to the SEC. At this time, the Company
is unable to predict the outcome of this investigation and the ultimate effects
on the Company.
Other Litigation
The Company was involved in other litigation, investigations of a
routine nature and various legal matters during the reporting period, which were
and are being defended and otherwise handled in the ordinary course of business.
While the ultimate results of these matters cannot be determined or predicted,
management believes that they have not had and will not have a material adverse
effect on the Company's results of operations or financial position.
Item 4. Submission of Matters to a Vote of Security Holders
An Annual Meeting of Shareholders of the Company was held on February
20, 2002. Following is a brief description of the matters voted upon at the
meeting and the tabulation of the voting therefor:
Proposal 1 - Election of Directors.
Number of Votes
------------------------------------------------
Nominee For Withheld Broker Non-Votes
------- --- -------- ----------------
Dennis C. Bottorff 295,306,431 2,087,055 0
Barbara L. Bowles 295,287,851 2,105,635 0
James L. Clayton 295,302,104 2,091,382 0
Reginald D. Dickson 295,337,415 2,056,071 0
E. Gordon Gee 295,239,153 2,154,333 0
John B. Holland 295,276,458 2,117,028 0
Barbara M. Knuckles 295,251,300 2,142,186 0
Cal Turner 295,267,681 2,125,805 0
David M. Wilds 295,322,340 2,071,146 0
William S. Wire, II 295,300,680 2,092,806 0
Proposal 2 - Shareholder Proposal Regarding Equal Employment
Opportunity Information. A shareholder proposal recommending that the Company
adopt certain measures regarding equal employment opportunity information was
rejected, with 201,041,839 votes cast against, 11,424,922 votes cast for,
8,680,476 votes abstained and 76,246,249 broker non-votes.
23
Proposal 3 - Ratification of the Appointment of Independent Public
Accountants. A proposal to ratify the selection of Ernst & Young LLP as
independent public accountants for the fiscal year ending February 1, 2002 was
adopted, with 295,419,977 votes cast for, 606,032 votes cast against, 1,367,471
votes abstained and no broker non-votes.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
The exhibit listed on the accompanying Exhibit Index is
filed as a part of this report and such Exhibit Index is
incorporated herein by reference.
(b) Reports on Form 8-K.
(1) A Current Report on Form 8-K, dated April 18,
2002, was filed with the SEC in connection with
an announcement regarding the signing of a $450
million fully underwritten bank commitment.
(2) A Current Report on Form 8-K, dated April 18,
2002, was filed with the SEC in connection with
an announcement regarding March 2002 sales
results and April 2002 sales expectations.
(3) A Current Report on Form 8-K, dated April 4,
2002, was filed with the SEC in connection with
an announcement regarding the appointment of
James D. Robbins to the Company's Board of
Directors and to the Audit Committee of the
Company's Board of Directors.
(4) A Current Report on Form 8-K, dated March 26,
2002, was filed with the SEC in connection with a
conference call held to discuss the Company's
business plans and strategy.
(5) A Current Report on Form 8-K, dated March 20,
2002, was filed with the SEC in connection with a
conference call held to discuss the Company's
unaudited financial results for its 2001 fiscal
year.
(6) A Current Report on Form 8-K, dated February 8,
2002, was filed with the SEC in connection with
an announcement regarding January 2002 sales
results, sales results for the fourth quarter of
fiscal 2001, 2001 annual sales results and
February sales expectations.
24
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DOLLAR GENERAL CORPORATION
By:
/s/ James J. Hagan
---------------------------------------------
James J. Hagan
Executive Vice President and Chief
Financial Officer (Principal Financial and
Accounting Officer)
June 10, 2002
25
EXHIBIT INDEX
Pursuant to Item 601 of Regulation S-K
Exhibit No. Description of Exhibit
----------- ----------------------
10.1 Commitment Letter, dated March 11, 2002, from SunTrust Bank and
SunTrust Capital Markets, Inc. to Dollar General Corporation.
26