Big Lots swings to loss amid higher expense; expects ‘challenging’ holiday results
Big Lots reported a wider-than-expected third quarter loss and lowered its earnings guidance for the holiday period and full year.
The discounter swung to a net loss for the quarter to Nov. 3 of $6.6 million, or 16 cents a share, for the quarter ended Nov.3, from a profit of $4.4 million, or 10 cents a share, in the same period a year ago. Analysts polled by Refinitiv were expecting the company to break even on a per-share basis.
That compares with the company's previous per-share guidance range of a loss of 6 cents to a profit of 4 cents, and the FactSet consensus of a 1-cent loss.
Sales rose to $1.15 billion from $1.11 billion, beating estimates of $1.14 billion. Same-store sales rose 3.4%, also more than expected.
"In terms of third quarter, we were pleased to achieve our second consecutive quarter of positive comps, but our bottom line results fell short of our expectations,” said Bruce Thorn, who took the reins as president and CEO of Big Lots in late September. “While we expect near-term results to be challenging this holiday season, we have a strong brand, great people, and we are working swiftly to enhance our current strategy, identify new growth opportunities, and position our business for profitable expansion well into the future."
Big Lots said it now expects comparable-store sales for the fourth quarter to be between flat to up 2% compared to its previous estimate of an increase in the low single digits. It expects earnings of $2.20 to $2.40 a share, compared to its previous estimate of $2.90 to $3 a share. Analysts were expecting earnings of $2.92 a share.
For fiscal 2018, the company affirmed its same-store sales growth guidance of "approximately 1%," but cut its adjusted outlook to $3.55 to $3.75 from $4.40 to $4.55.