Even dollar stores are getting slammed by the retail theft crisis.
Dollar Generals shares tanked Thursday after the discounter provided a bleak outlook for the rest of the year because of rising thefts and weak consumer demand at its 19,000 stores nationwide.
The Tennessee-based company warned Wall Street that profits may plunge by as much as 34% compared to its previous forecast for an 8% decline to flat growth as cut its full-year profit and sales targets for the second time this year.
“Our revised guide is really a function of the slower transactions that we’re seeing, and higher expected shrink,” Dollar General CFO Kelly Dilts said on a call with analysts after the company reported quarterly earnings that fell short of Wall Street estimates.
The reference to “shrink” — an industry term for stolen or damaged goods — follows a troubling trend cited by other major retailers who have blamed the scourge of organized retail theft for impacting their bottom line.
Target has said it expects to lose $500 million because of theft at its stores.
Dollar Tree said in May that it would need to raise prices in some regions because of persistent shoplifting.
Dollar General’s gross profit as a percentage of net sales fell 126 basis points in the quarter as retail shrink worsened. It flagged $100 million in additional shrink headwinds since its last earnings call in June.
CEO Jeff Owen did not elaborate on the extent of the theft, instead pointing to still-stubborn inflation for shoppers feeling “financially constrained.
Dollar Generals core customers are feeling the acute pressure of the cost-of-living-crisis, echoed Neil Saunders, retail analyst and managing director at GlobalData, in a report Thursday.
Dollar General lowered its same store sales guidance to a decline of about 1% and 1% increase compared to its previous forecast of a 1% to 2% increase.
The companys comparable sales dropped by 1% in the second quarter ended Aug. 4 and the company expects a pileup of inventory to be a drag on its earnings for the rest of the year as it slashes prices on items that havent been selling.
The quarter “marks the fourth consecutive guide down for Dollar General, which admittedly creates further uncertainty if we are hitting the bottom yet,” said Raymond James analyst Bobby Griffin.
The stock nosedived down more than 12% Thursday to close at $138.59.
It has tracked a nearly three-and-a-half-year low, slumping as much as 18.2% to hit $128.96 — making it one of the worst performers on the S&P 500 index this year.
As inflation continued to batter shoppers this year, more customers flocked to Dollar General and its rival Dollar Tree among other big discounters.
But food and other essential items are less profitable for those stores as profit margins on food are anemic.
While we are not satisfied with our overall financial results, we made significant progress in the second quarter improving execution in our supply chain and our stores, as well as reducing our inventory growth rate and further strengthening our price position, Owen said in a statement.
A “loophole” that allowed a Palestinian family to be granted the right to come to the UK under a Ukrainian resettlement scheme was the subject of a lot of debate in the House of Commons today.
Both the prime minister and leader of the opposition criticised a decision by a judge to allow the family of six the right to enter the UK.
Sir Keir pledged to close the “loophole” after he was asked about it by Kemi Badenoch – but could not elaborate on what it was.
Sky News has read through the judgment given by Judge Hugo Norton-Taylor to understand what happened.
The family of six, a husband and wife and their children aged 18, 17, eight and seven, lived in Gaza and their homes were destroyed after the 7 October attacks and subsequent conflict.
They ended up living in a humanitarian zone and then a refugee camp.
In January 2024, the family applied to come to the UK via the Ukraine Family Scheme form, in a bid to join one of the parent’s brothers, who is a British citizen and has lived in the UK since 2007.
While they acknowledged they were not eligible for the Ukraine scheme, the family chose to apply in an attempt to use the Home Office‘s policy on “applications for entry clearance outside the rules”.
The Home Office rejected the request, saying they were not satisfied there were “compelling, compassionate circumstances” to justify a request outside the rules.
They also noted the lack of a resettlement scheme for Palestinians.
Despite the Home Office saying there were no grounds to appeal, the family launched one against the decision on human rights grounds.
A judge then ruled that the initial rejection constituted a rejection of human rights, and so allowed an appeal.
Part of this appeal was under Article Eight of the European Convention on Human Rights – the right to a family life between the man living in Britain and his family in Gaza.
This appeal was rejected, with a lack of a Palestinian resettlement scheme noted as a reason.
An appeal was launched at a higher tribunal – and one of the arguments was that the case should be considered on its own merits and not allow the lack of a Palestinian resettlement scheme to outweigh other arguments.
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8:44
PMQs: War on immigration
The loophole
It is here that the “loophole” seems to have appeared.
At this point. Judge Norton-Taylor heard the case and allowed the appeal.
In his judgment, he stated that it was “wrong to have taken the absence of a resettlement scheme into account at all”.
The judge added that there was “no evidence” he had seen that the Home Office had made a deliberate decision not to implement a Palestinian resettlement scheme.
He also noted that the lack of immigration rules on a topic should not count against someone.
In layman’s terms, the argument seems to be that just because a scheme to resettle people does not exist it does not mean they are banned from coming to the UK via humanitarian routes.
The judgment said the absence of a “resettlement scheme was irrelevant” to their decision.
What next?
Judge Norton-Taylor went on to back the claim from the family in Gaza based on the ECHR and the right to a family life between them and their relative in Britain.
A Home Office spokesperson said: “The Ukraine Family scheme was clearly set out for Ukrainians. We have been clear that we do not agree with this judgment and we twice vigorously contested this case.
“As the prime minister made clear, article 8, the right to a family life, should be interpreted much more narrowly. It is for the government and Parliament to decide who should be covered by the UK’s safe and legal routes.
“We are pursuing all legal avenues to address the legal loophole which has been exploited in this case. The home secretary is urgently reviewing this case to ensure the correct processes are always followed and existing laws correctly interpreted.”
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They added that there was no evidence to support the argument and that data from the government shows a “very small” number of Gazans have been allowed to enter the UK – equal to roughly 150.
Sir Keir said he was planning to close the loophole, but it is not clear what this will entail.
In response, Israel, with the backing of US President Donald Trump, had threatened to renew its offensive if hostages were not freed.
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0:37
‘Let hell break out’
But Hamas has now indicated three more Israeli hostages would be freed on Saturday.
Egyptian and Qatari mediators have affirmed they will work to “remove all hurdles” to ensure the ceasefire holds, the group added in a statement.
Israel is yet to comment on the Hamas announcement.
The ceasefire began on 19 January, bringing a pause to 16 months of war in Gaza.
More on Gaza
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In its first stage, which will last 42 days, Hamas is meant to free 33 Israeli hostages taken during its attack on 7 October 2023, which sparked the war.
So far it has released 21 hostages – 16 Israelis and five Thai – in exchange for hundreds of Palestinian prisoners freed from Israeli custody.
Last week, the release of three Israeli men gave rise to concerns about their gaunt appearance, and what that said about the conditions they had been kept in during 16 months in captivity.
Image: Aid trucks move through Rafah, Gaza, amid the ceasefire. Pic Reuters
Israel and Hamas are expected to begin negotiations on a second phase of the deal, which would extend the truce and see all Israeli troops withdraw from Gaza in exchange for the freedom of the remaining hostages – though little progress appears to have been made so far.
Negotiations have been further complicated in recent weeks by Mr Trump’s proposal to relocate Palestinians so the US can take over Gaza.
When Mr Trump hosted Jordan’s king on Tuesday, he reiterated his controversial idea, saying the enclave’s population of over two million would not be able to return but would have a better, safer future elsewhere.
Mr Trump said: “It’s a war-torn area, we’re going to hold it, we’re going to take it… Gaza the way it is, civilisation has been wiped out in Gaza. It’s going to be a great economic development.”
Much of Gaza lies in ruins after Israel’s war to destroy Hamas.
More than 48,000 Palestinians have been killed, according to the Hamas-run Gaza health ministry, which does not differentiate between civilians and combatants in its count.
At least 1,200 people were killed and more than 250 taken hostage when Hamas launched its massacre in Israel on 7 October 2023.
At the BAFTAsthis weekend, it is shortlisted for 11 prizes; just pipped by papal thriller Conclave, which has 12. And star Karla Sofia Gascon has made history as a trans woman nominated for best actress at both ceremonies.
Set in Mexicobut mostly filmed in France, Emilia Perez is an operatic Spanish-language musical which tells the story of a Mexican drug lord who undergoes gender affirmation surgery. In May last year, it won the Cannes Film Festival jury prize, setting it on its trajectory to 2025 awards season success.
Image: Selena Gomez (pictured with Gascon) also stars in in the film. Pic: Page 114/ Why Not Productins/ Pathe/ France 2 Cinema/ Netflix
The film’s acknowledgement seemingly reflected the more progressive attitudes of voters in recent years – but as its profile rose, so did the scrutiny.
US LGBTQ+ advocacy and cultural change group GLAAD has described Emilia Perez as a “step backward for trans representation”, and highlighted reviews by transgender critics who “understand how inauthentic portrayals of trans people are offensive and even dangerous”.
The film has also come under fire for stereotypical depictions of Mexico and an apparent minimal inclusion of Mexican people among the main cast and crew. Of its main stars, Gascon is Spanish, US actress Zoe Saldana is of Dominican Republic and Puerto Rican descent, and Selena Gomez is American, though her father was of Mexican descent. Adriana Paz is Mexican.
In a post on X in January viewed more than 2.7m times, Mexican screenwriter Héctor Guillén shared a mock-up poster saying: “Mexico hates Emilia Pérez/ Racist Euro Centrist Mockery/ Almost 500K dead and France decides to do a musical/ No Mexicans in their cast or crew.”
While stories about “narco” crime in Latin America have long been depicted on screen, Emilia Perez has been particularly criticised for its handling of the subject. Since 2006, a bloody war between Mexican authorities and the drug cartels has raged, claiming the lives of more than 400,000 people, according to government data. More than 100,000 have gone missing.
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4:15
Inside Mexico’s gang war
Offensive? Or a ‘crazy marvel’?
General audiences appear to have made their thoughts clear. On film database site IMDB, Emilia Perez gets 5.5 out of 10, while its nine competitors in the running for best picture at the Oscars rate between 7.3, for The Substance, and 8.8 for I’m Still Here.
On review site Rotten Tomatoes, Emilia Perez gets a 72% from critics, but just 17% from audiences; again, the rest of its Oscars competitors range from Wicked’s 88% critics’ score to I’m Still Here’s 96%, or Nickel Boy’s 65% audience score to I’m Still Here’s 99%. The two takeways? The gap is clear whichever way you look at it; watch I’m Still Here.
That’s not to say Emilia Perez does not have its supporters. Speaking after a screening in October, Oscar-winning Mexican filmmaker Guillermo del Toro said it was “so beautiful to see a movie that is cinema“, and hailed director Jacques Audiard as “one of the most amazing filmmakers alive”.
A review in US entertainment outlet Deadline in May during Cannes last year was headlined, “Jacques Audiard’s musical is crazy, but also a marvel”, with the writer saying the “sparkle never outshines the essential seriousness of the subject”. In Variety, another US entertainment publication, the headline praised Gascon’s electrifying performance.
Image: L-R: Emilia Perez stars Adriana Paz, Selena Gomez, Zoe Saldana and Karla Sofia Gascon at the Golden Globes. Pic: AP/ Chris Pizzello
Paz, who shared the Cannes best actress prize with her co-stars last year, has questioned the criticism about the film being “offensive” to Mexico, saying: “I really want to know why, because I didn’t feel that way.”
Carlos Aguilar, a film critic originally from Mexico City who writes for the Roger Ebert film website, was generally positive in his review, giving the film three out of four stars.
However, he highlights that Emilia Perez is “not a Mexican film” and notes “Mexican audiences have grown accustomed to American perspectives exploiting narco-related afflictions for narratives unconcerned with addressing its root causes”.
Questioning intentions behind these productions is valid, he says, “but to decry Audiard for partaking in the common filmmaking practice of telling stories away from what’s immediately familiar to him would seem an overly simplistic assessment”.
Karla Sofia Gascon’s resurfaced tweets
Image: Gascon at the premiere in Mexico in January. Pic: Ismael Rosas/ EyePix/INSTARimages/ Cover Images via AP
But the criticism from some trans people and some Mexicans is not a good look for a supposedly progressive film about a trans woman in Mexico. All publicity is good publicity does not apply here.
A lot of this criticism, though, had been made before the Oscar and BAFTA nominations. Emilia Perez was still riding high at that point.
The nail in the coffin came after those nominations were announced, when offensive tweets posted by Gascon were unearthed. They were old, but not that old; the first dated back to 2016, but some were more recent.
In the since-deleted posts, Gascon took aim at Muslims’ dress, language and culture in her native Spain and suggested Islam should be banned.
And less than a month after the killing of George Floyd by a white police officer in 2020, which prompted a global reckoning about police brutality and racism, Gascon called Floyd a drug addict who “very few people ever cared” for.
Writer Sarah Hagi, who screenshotted the posts and shared them, wrote: “This is all from the star of a movie that is campaigning on its progressive values, you really gotta laugh.
Gascon, who was a regular in Mexican telenovelas before transitioning in 2018, issued an apology after the posts emerged, saying that “as someone in a marginalised community, I know this suffering all too well and I am deeply sorry to those I have caused pain”.
She added: “All my life I have fought for a better world. I believe light will always triumph over darkness.”
‘This is an opera, not a criticism of Mexico’
Image: Director Jacques Audiard on set. Pic: Shanna Besson/ Page 114/ Why Not Productions/ Pathe/ France 2 Cinema/ Netflix
But it looks like the damage has been done. While Saldana is still favourite to win best supporting actress at both the BAFTAs and the Oscars, and the film may win gongs for its music and maybe technical accolades, it seems the momentum for taking home any bigger prizes has gone.
As the backlash intensified, Audiard gave an interview to Deadline last week. He said he had not been in touch with Gascon and that he was “very sad” to see the issue “taking up all the space” around the film. What she said in her tweets was “inexcusable”, he added.
The filmmaker also addressed criticism about representation of cartels and drug crime, saying: “Opera has psychological limitations. It seems I’m being attacked in the court of realism.”
Audiard said he never claimed to have made a “realistic” work or a documentary. “For example, I read a review where it said that night markets in Mexico City don’t have photocopiers. Well, in night markets in Mexico City, one also doesn’t sing and dance. You have to accept that is part of the magic here. This is an opera, not a criticism of anything about Mexico.”
Finally, asked if he had any regrets or if there was anything he would do differently, he said the one regret was that the film was not made in Mexico. “And the simple reason for that is that the film funding, the public funding for film in Mexico was not as good for us as what was available to us in France”.
Emilia Perez now heads to the BAFTAs and Oscars embroiled in controversy. But it is not the first. Remember British star Angela Riseborough’s nomination in 2023? Some, like Green Book in 2019, weathered it out to win. And Will Smith won his Oscar just moments after slapgate in 2022.
We’ll see at the BAFTAs on Sunday and at the Oscars next month, how forgiving voters will be about Emilia Perez.