From Home Furnishing Business
Big Lots reports double-digit profit hike on flat sales in second quarter
Discount retailer Big Lots (BIG) said second-quarter sales were essentially even with last year's second quarter, but net income jumped more than 28% on improved gross margins and better inventory management.
The 1,445-store chain said sales in the quarter ended July 30 totaled $1.203 billion, compared with $1.209 billion in the same quarter last year.
Comparable-store sales rose 0.3%, marking the 10th consecutive quarter of comparable-store growth.
Net income totaled $22.7 million or 50 cents per share. That was up 28.8% from $17.6 million or 34 cents per share in the comparable quarter.
Gross margin rose to 40.4% from 39.3% in last year's second quarter.
“We are pleased to report comps increased for the 10th consecutive quarter and our earnings were above the high end of our guidance range," said David Campisi, President and CEO. He said consumers are "responding positively to our strategic focus on ownable and winnable merchandise categories, improved merchandise presentations and more consistent in-store execution.”
Key merchandise categories for Big Lots include furniture, bedding, food, home goods and electronics.
The retailer also boosted its earnings guidance for the fiscal year to $3.45 to $3.55 per share. That's up from a May forecast of $3.35 to $3.50 per share. The forecasts exclude the impact of the company's termination of its legacy pension plan, which reduced earnings by 1 cent per share in the most recent quarter.
The company said it expects comparable-store sales to increase 1% to 2% for the years.
For the six months ended July 30, sales rose 1% to $2.515 billion. Net income was up 23.1% to $61.4 million or $1.31 per share.