Dollar General Corp reported a higher-than-expected profit and said sales and profit should rise again this fiscal year.

Dollar General, which prices most of the merchandise at its 9,372 stores below $10, has benefited as lower-income consumers shifted away from pricier stores and even from discounters like Wal-Mart Stores Inc , to save on basic goods like food.

Chief Executive Rick Dreiling said winter storms cut into some shopping in the latter half of the three-month period. But more people overall visited its stores and spent more when they shopped.

Shares of Dollar General were up 3 percent to $31.33 in premarket trading.

Fourth-quarter sales rose 9.4 percent to $3.49 billion. Sales at stores open at least a year, or same-store sales, rose 3.8 percent, missing the company's forecast of about 5 percent.

Same-store sales increased at the slowest pace of the year, following gains of 4.2 percent in the third quarter, 5.1 percent in the second quarter and 6.7 percent in the first. Same-store sales rose 7.4 percent in the year-ago fourth quarter.

Dollar General expects same-store sales to rise 3 percent to 5 percent this year, with earnings at $2.20 to $2.30 per share.

Dollar General, which is majority-owned by private equity firm Kohlberg Kravis Roberts & Co LP , earned $222.5 million, or 64 cents per share, in the fourth quarter ended on January 28, up from $87.2 million, or 26 cents per share, a year earlier.

Excluding certain items Dollar General earned 65 cents per share, beating Wall Street's forecasts of 59 cents, according Thomson Reuters I/B/E/S.

The company cut adjusted selling, general and administrative costs to 20.6 percent of sales, down from 21.3 percent a year earlier, and benefited from a lower-than-expected tax rate.

Dollar General, which has more than 9,370 stores in 35 U.S. states, confirmed its intention to open 625 stores this year. It also plans to relocate about 550 stores.

(Reporting Jessica Wohl in Chicago and Phil Wahba in New York;

Editing by Lisa Von Ahn and Derek Caney)

Walmart