Good market position in "extreme value" retail segment; and Positive results from new management operational turnaround strategies. Intensely competitive industry; Very high debt leverage; and Past execution difficulties that resulted weak profitability. The ratings on Dollar General Corp. reflect its highly leveraged capital structure, thin cash flow protection measures, and participation in the highly competitive discount retail environment. Due to its extreme value proposition, Standard&Poor's Ratings Services believes Dollar General is benefiting from consumers trading down in a harsh economic environment. In addition, restructuring initiatives in recent years, including improved merchandising and better operating efficiency, have contributed to better sales and earnings. Still, we anticipate the U.S. retailing landscape remaining very difficult and reduced discretionary spending could pressure
