The exterior of a Dollar General convenience store is seen in Austin, Texas, on March 16, 2023.
Brandon Bell | Getty Images
Dollar General’s former CEO Todd Vasos is reemerging from retirement to lead the company, aiming to revive its growth and address allegations of unsafe working conditions.
Vasos, who served as Dollar General’s CEO from June 2015 to November 2022, will take over from Jeff Owen immediately, the company announced on Thursday.
“The Board has utmost respect for Jeff and deeply values his significant contributions to the Company, particularly during his extensive tenure overseeing our retail operations,” stated Michael Calbert, Chairman of the company’s board. “However, the Board has decided that a change in leadership is necessary to restore stability and confidence in the Company as we move forward.”
Owen held the position for less than a year, during which Dollar General experienced a decline in sales growth and faced criticism from federal officials and activists regarding hazardous stores risking employee safety.
The rapidly expanding company currently operates over 19,000 stores across 47 states, employing more than 185,000 individuals.
Dollar General’s shares surged over 6% in after-hours trading on Thursday.
Revised Guidance
During its previous earnings report, Dollar General revised its full-year profit forecast. It has done so again on Thursday, now expecting earnings per share to range from approximately $7.10 to $7.60, compared to the previous estimate of $7.10 to $8.30.
Dollar General also adjusted its net sales growth projection to 1.5% to 2.5% from the previous expectation of 1.3% to 3.3%.
The company predicts same-store sales to be flat or decrease by 1% this year, as opposed to the prior expectation of a 1% decline to a 1% increase.
Vasos expressed his “honored” return to the company during such a “crucial moment” in a statement.
“I am eager to rejoin the team and collaborate with them towards regaining operational excellence for both our employees and customers. Our primary goals are sustainable long-term growth and value creation for our shareholders,” stated Vasos.
The deceleration in sales coincides with mounting pressure from employees and activists concerning working conditions. Shareholders passed a resolution in May, despite the board’s objections, to conduct an independent audit on worker safety. However, the enforceability and implementation of this measure remain uncertain.
Dollar General has accumulated over $21 million in fines from federal authorities for violations such as blocked fire exits, obstructed electrical outlets, and clutter.
When the shareholder resolution was approved, a spokesperson for Dollar General emphasized the company’s commitment “to foster a work environment where employees can advance their careers, serve their local communities, feel valued and heard,” urging employees to share their feedback through company-provided channels to address concerns and challenges and celebrate successes.
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