Big Lots profits down in 3Q, home highlighted
GDA Staff -- Gifts & Dec, December 3, 2010
Columbus, Ohio -- Big Lots reported a drop in profit from last year and cut its outlook for the fourth quarter, yet cited home as a hot category in the third quarter as consumers looked to keep warm.
"Customers continue to be selective but were willing to spend money where they saw tremendous values," said Steven Fishman, chairman, ceo and president, during the retailer's earnings call this morning. " From a merchandising perspective, furniture, seasonal and home continued to lead the way."
"Home comped up in the low single-digits on top of improving trends from a year ago, so comp on comp-which I believe is an indicator of the category gaining momentum," Fishman added.
Going into the all-important fourth-quarter holiday selling season, Big Lots reported a successful start over the three-day Thanksgiving weekend. "We made some major investments in a couple of categories. We had a good Thanksgiving weekend," Fishman continued. He cited blankets and microfiber items in the $15-$20 range as particularly good sellers.
The 1,389-unit closeout retailer reported net income of $17.7 million, or 23 cents per diluted share, and income from continuing operations of $17.7 million, or 23 cents per diluted share, for the third quarter of ended Oct. 30, 2010. This is down 42% from net income of $30.3 million, or 37 cents per diluted share, for the third quarter of fiscal 2009. Net sales for the third quarter increased 2% to $1,055.8 million, compared to $1,035.3 million for the same period in 2009. Comparable store sales increased 0.7% for the quarter. The company cited higher expenses in the quarter as a factor, including costs related to adding merchandise and associates for the holiday selling season.
Based on these results, the company has updated its outlook for the fourth quarter and lowered its full-year guidance to between $2.75 to $2.81 per share, from prior guidance of $2.75 and $2.85 per share.
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