Big Lots sees holiday led by home, keeps eyes on furniture for future opportunities
Home Textiles Today Staff -- Home Textiles Today, 3/3/2011 4:12:27 PM
Columbus, Ohio - The home business decked Big Lots' halls in the fourth quarter as this department was the forerunner among several higher-ticket discretionary categories that drove the off-price chain's results in the period.
"Our home category was a leader in the store. Newness and better quality goods and deeper inventory levels for key items worked well for us this holiday season," said Steve Fishman, chairman, ceo and president, during the 48-state 1,398-unit retailer's earnings conference call this morning.
He later noted that for the last several quarter, "our best performing categories continue to be our discretionary higher-ticket businesses"
Specifically, furniture, home and seasonal each posted mid-single-digit comps in the fourth quarter against "some tough comparisons from a year ago," he said.
Big Lots is "very encouraged by the continued strength in our furniture business," which was up against double-digit comps, Fishman added. "We continue to believe furniture could be one of the largest growth opportunities we have for the future."
Softer in the quarter were toys and consumables, the latter being Big Lots' largest merchandising category.
In its fourth quarter, ended Jan. 29, the company's overall net income grew by 4.2% to $110.1 million, or $1.46 per diluted share, compared to $105.4 million, or $1.27 per diluted share, in the prior year.
Net sales for rose by 3.8% to $1,518.9 million compared to $1,463.3 million in the year-ago period. And comparable store sales for stores open at least two years at the beginning of the fiscal year were flat.
For fiscal 2010, representing Big Lots' fourth consecutive year of record operating profit and earnings per share, net income increased by 11% to $222.5 million, or $2.83 per diluted share, versus $200.4 million, or $2.42 per diluted share, in fiscal 2009.
Net sales for the year increased 4.8% to $4.9 billion versus $4.7 billion in fiscal 2009, and comparable store sales were up 2.5%.
Big Lots' outlook for 2011 calls for an estimated income from continuing operations to be in the range of $3.05 to $3.15 per diluted share compared to $2.83 per diluted share for fiscal 2010. The company said this guidance is based on a projected comparable store sales increase in the range of 1% to 2% and a total sales increase in the range of 5% to 6%.
From a real estate perspective, Big Lots said this year it expects to open 90 new stores and close up to 45 locations for net store growth of 45 stores, or approximately 3%.
First-quarter guidance includes an estimated comparable store sales to be slightly positive to slightly negative with total sales up in the range of 2% to 4%. Based on this level of sales performance, the company's income from continuing operations is estimated to be in the range of 76 cents to 81 cents per diluted share, compared to 68 cents per diluted share in the same period last year.
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