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Andrea Turner

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DOLLAR GENERAL REPORTS THIRD QUARTER EPS OF $0.23

GOODLETTSVILLE, Tenn. – December 4, 2003 – Dollar General Corporation (NYSE: DG) today reported net income for the third quarter of fiscal 2003 of $77.9 million, or $0.23 per diluted share, compared to $68.6 million, or $0.20 per diluted share, in the third quarter of fiscal 2002, an increase of 13.6 percent. Excluding restatement-related items from the prior year’s results, net income in the quarter increased 46.3 percent when compared against net income of $53.2 million, or $0.16 per diluted share, in 2002.  In the third quarter of 2002, the Company recorded approximately $24.3 million of net restatement-related pre-tax income, primarily from insurance proceeds.

Net sales during the third quarter of 2003 increased 12.5 percent to $1.69 billion compared to $1.50 billion in the third quarter of 2002.  The increase resulted primarily from 577 net new stores and a same-store sales increase of 3.8 percent.  

Gross profit during the quarter was $516.9 million, or 30.7 percent of sales, versus $428.6 million, or 28.6 percent of sales, in the prior year. The increase in the gross margin rate as a percent to sales is attributable to higher average markup on inventories, a decrease in distribution and transportation expenses as a percentage of sales, a decrease in the Company’s provision for inventory shrinkage, strong sales of high margin seasonal inventories and a $7.8 million favorable non-recurring inventory adjustment primarily representing a change in the Company’s estimated provision for inventory shrinkage. The non-recurring adjustment resulted from using an improved inventory ownership estimate due to the implementation, for financial reporting purposes, of an item level perpetual inventory system. The Company reiterated that it anticipates a challenging gross margin rate comparison versus last year’s performance in its fourth quarter, which ends on January 30, 2004.

Selling, general and administrative expenses (“SG&A”) for the quarter were $385.6 million, or 22.9 percent of sales, in the current year, versus $335.2 million, or 22.4 percent of sales, in the prior year. The increase in SG&A as a percent to sales is primarily due to increases in workers’ compensation and general liability costs, store training expenses, and the accrual for bonuses.

Net interest expense during the current year period decreased by 30.9 percent to $8.0 million in the current year quarter compared to $11.5 million in the prior year.  The decrease is primarily attributable to lower average debt outstanding in the current year quarter. The Company had $285.7 million in debt outstanding at October 31, 2003, compared to $518.3 million at November 1, 2002.

For the 39-week year-to-date period, net income was $198.2 million in fiscal 2003, or $0.59 per diluted share, compared to $156.9 million, or $0.47 per diluted share, in the comparable prior year period, an increase of 26.3 percent. Excluding net restatement-related items from both years, year-to-date net income increased 40.1 percent to $198.4 million, or $0.59 per diluted share, in fiscal 2003 compared to net income of $141.6 million, or $0.42 per diluted share, in the comparable prior year period. Year-to-date net sales increased 13.0 percent, including a same-store sales increase of 4.3 percent.

Return on invested capital for the trailing year increased to 13.8 percent from 12.6 percent in the previous year. Excluding restatement-related items, return on invested capital for the trailing year increased to 13.9 percent from 12.4 percent in the previous year. Return on assets for the trailing year increased to 12.7 percent from 10.3 percent in the previous year. Excluding restatement-related items, return on assets for the trailing year increased to 12.8 percent from 10.0 percent in the previous year.

Conference Call

The Company will host a conference call on Thursday, December 4, 2003, at 10 a.m. ET to discuss the quarter’s results.  The security code for the conference call is “Dollar General.”  If you wish to participate, please call 334-260-2280 at least 10 minutes before the conference call is scheduled to begin.  A webcast of the call can also be accessed live on Dollar General’s Web site at www.dollargeneral.com by clicking on the home page spotlight item. A replay of the conference call will be available until 5 p.m. ET on Thursday, December 18, online or by calling 334-323-7226.  The access code for the replay is 40954 and the pass code is 86362.

About Dollar General

Dollar General is a Fortune 500 ^® discount retailer with 6,709 neighborhood stores in 27 states as of November 28, 2003.  Dollar General stores offer convenience and value to customers, by providing consumable basics, items that are frequently used and replenished, such as food, snacks, health and beauty aids and cleaning supplies, as well as an appealing selection of basic apparel, housewares and seasonal items at everyday low prices.  

Non-GAAP Disclosures

This release includes certain financial information not derived in accordance with generally accepted accounting principles (“GAAP”), including net income, diluted earnings per share, SG&A expenses, operating profit margin, return on assets and return on invested capital, excluding restatement-related items. The Company includes these non-GAAP financial measures in order to indicate more clearly for investors the Company’s comparative year-to-year operating results. The Compensation Committee of the Company’s Board of Directors may use portions of this information for compensation purposes to ensure that employees are not inappropriately penalized or rewarded as a result of unusual items affecting the Company’s financial statements. Management may also use this information to better understand the Company’s underlying operating results. In addition, the return on invested capital, included in this release, may be considered a non-GAAP financial measure.  Management believes that return on invested capital provides investors with additional useful information for evaluating the efficiency of the Company’s capital deployed in its operations. None of this information should be considered a substitute for any measures derived in accordance with GAAP. The Company has included its calculation of return on invested capital and reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measures in the accompanying schedules.

Forward-Looking Information

This press release may contain forward-looking information, such as information regarding gross margin rate expectations. The words "believe," "anticipate," "project," "plan," "expect," "estimate," "objective," "forecast," "goal," "intend," "will likely result," or "will continue" and similar expressions generally identify forward-looking statements. 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 by, or implied in, the forward-looking statements. The factors that may result in actual results differing from such forward-looking information, include, but are not limited to: the Company's ability to maintain adequate liquidity through its cash resources and credit facilities; the Company's ability to comply with the terms of the Company's credit facilities (or obtain waivers for non-compliance); transportation and distribution delays or interruptions; the impact on transportation costs from the “driver hours of service” regulations adopted by the Federal Motor Carriers Safety Administration, which are scheduled to become effective on January 4, 2004;  the Company's ability to negotiate effectively the cost and purchase of merchandise; inventory risks due to shifts in market demand; changes in product mix; interruptions in suppliers' businesses; costs and potential problems and interruptions associated with implementation of new or upgraded systems and technology; fuel price and interest rate fluctuations; a deterioration in general economic conditions caused by acts of war or terrorism; temporary changes in demand due to weather patterns; seasonality of the Company's business; delays associated with building, opening and operating new stores; delays associated with building, opening, expanding and converting new or existing distribution centers; the impact of the SEC inquiry related to the restatement of certain of the Company's financial statements; and other risk factors discussed in our SEC filings, including in our most recent Annual Report on Form 10-K.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release.  Except as may be required by law, the Company disclaims any obligation to publicly update or revise any forward-looking statements contained herein to reflect events or circumstances occurring after the date of this release or to reflect the occurrence of unanticipated events. Readers are advised, however, to consult any further disclosures the Company may make on related subjects in its public disclosures or documents filed with the SEC.

Customer Transaction Data

(Unaudited)

(a)

Average assets is equal to the average total assets measured at the end of each of the last five fiscal quarters.

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Investor Contact:

Media Contact:

Emma Jo Kauffman

Andrea Ewin Turner

(615) 855-5525

(615) 855-5209

DOLLAR GENERAL REPORTS INCREASED NOVEMBER SALES

GOODLETTSVILLE, Tenn. – December 4, 2003 – Dollar General Corporation (NYSE: DG) today reported total retail sales for the November four-week period ended November 28, 2003, equaled $575.3 million compared with $522.4 million last year, an increase of 10.1 percent. Same-store sales for the November period increased 1.7 percent compared with a 0.5 percent increase in the prior year November period.  The average customer purchase in November was approximately $8.90 compared to $8.86 in the same period last year.  Customer transactions in same-stores increased approximately 1.7 percent.

November sales by major merchandise category are as follows:

Departments reporting the strongest same-store percentage sales increases for November include the domestics department, the home cleaning and food department, and the hardware, toys and stationery department.  

For the 43 weeks ended November 28, 2003, Dollar General total retail sales increased 12.7 percent to $5.5 billion from $4.9 billion in the same period a year ago.  Same-store sales for the 43 weeks increased 4.0 percent.  

December Sales Outlook

For the five-week December period ending January 2, 2004, the Company expects total sales to increase 10 to 12 percent. Same-store sales are expected to increase 2 to 4 percent compared with a same-store sales increase of 2.3 percent in the December period last year.  December sales results will be released on Thursday, January 8, 2004.

Dollar General is a Fortune 500 ^® discount retailer with 6,709 neighborhood stores as of November 28, 2003.  Dollar General stores offer convenience and value to customers, by offering consumable basics, items that are frequently used and replenished, such as food, snacks, health and beauty aids and cleaning supplies, as well as an appealing selection of basic apparel, housewares and seasonal items at everyday low prices.  

This press release contains forward-looking information, including information regarding the Company’s future sales outlook.  The words “believe,” “anticipate,” “project,” “plan,” “expect,” “estimate,” “objective,” “forecast,” “goal,” “intend,” “will likely result,” or “will continue” and similar expressions generally identify forward-looking statements.  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 by, or implied in, the forward-looking statements.  The factors that may result in actual results differing from such forward-looking information, include, but are not limited to:  the Company's ability to maintain adequate liquidity through its cash resources and credit facilities; the Company's ability to comply with the terms of the Company's credit facilities (or obtain waivers for non-compliance); transportation and distribution delays or interruptions; the Company’s ability to negotiate effectively the cost and purchase of merchandise; inventory risks due to shifts in market demand; changes in product mix; interruptions in suppliers' businesses; costs and potential problems and interruptions associated with implementation of new or upgraded systems and technology; fuel price and interest rate fluctuations; a deterioration in general economic conditions caused by acts of war or terrorism; temporary changes in demand due to weather patterns; seasonality of the Company’s business; delays associated with building, opening and operating new stores; delays associated with building, opening, expanding or converting new or existing distribution centers; the impact of the SEC inquiry related to the restatement of certain of the Company’s financial statements; and other risk factors discussed in our SEC filings, including in our most recent Annual Report on Form 10-K.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release.  Except as may be required by law, the Company disclaims any obligation to publicly update or revise any forward-looking statements contained herein to reflect events or circumstances occurring after the date of this release or to reflect the occurrence of unanticipated events. Readers are advised, however, to consult any further disclosures the Company may make on related subjects in its public disclosures or documents filed with the SEC.

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Investor Contact:

Media Contact:

Emma Jo Kauffman

Andrea Ewin Turner

(615) 855-5525

(615) 855-5209

DOLLAR GENERAL OPENS 66 STORES IN NOVEMBER

667 Stores Opened So Far in Current Fiscal Year

GOODLETTSVILLE, Tenn. — December 4, 2003 —Dollar General (NYSE: DG) reports opening 66 stores in the four-week period ended November 28, 2003. With these additional stores, as of November 28, 2003, the Company operated 6,709 stores. To date, the Company has opened 667 stores this fiscal year.

The 66 newest store locations include two in Alabama; three in Florida; one in Georgia; two in Illinois; one in Indiana; one in Iowa; one in Kentucky; six in Louisiana; three in Michigan; two in Mississippi; one in Missouri; one in Nebraska; eight in New York; eight in North Carolina; one in Ohio; three in Pennsylvania; four in South Carolina; one in Tennessee; 10 in Texas; six in Virginia; and one in West Virginia.

Dollar General is a Fortune 500® discount retailer. The Company store support center is located in Goodlettsville, Tennessee. Dollar General’s Web site can be reached at www.dollargeneral.com .

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