Tuesday, broadline closeout retailer Big Lots Inc. (BIG) posted a higher profit for the second quarter, as tighter control on expenses somewhat offset the recession-driven sales decline. On a per share basis, earnings from continuing operations rose from last year and topped the Street view by five cents. Further, the company issued earnings forecasts for the third and fourth quarters and hiked its earnings guidance for the full year.
Q2 Results
The Columbus, Ohio-based company's second-quarter net income was $28.4 million or $0.34 per share, compared to $26.0 million or $0.32 per share in the prior-year quarter.
Income from continuing operations for the latest quarter totaled $28.6 million or $0.35 per share, up from the previous year's income from continuing operations of $26.1 million or $0.32 per share. On average, 15 analysts polled by Thomson Reuters expected the company to post earnings of $0.30 per share. Analysts' estimates typically exclude special items.
Quarterly net sales dropped to $1.09 billion from $1.11 billion reported a year ago, yet breezed past Wall Street analysts' consensus revenue estimate of $1.08 billion for the quarter.
During the most recent quarter, the company reported operating profit of $47.7 million, or 4.4% of sales, compared to $43.5 million, or 3.9% of sales in the corresponding quarter of the previous year. The 10% improvement in operating profit dollars was the result of improvement in its gross margin rate and lower overall expense dollars compared to last year.
Year-To-Date Synopsis
For the six-month period, the company reported net income of $64.7 million or $0.78 per share, compared to $60.5 million or $0.74 per share in the same period of last year.
Income from continuing operations advanced to $64.9 million or $0.79 per share from $60.6 million or $0.74 per share in the year-earlier period.
Net sales for the year-to-date period declined to $2.23 billion from $2.26 billion in the comparable period of the previous year.
Future In Focus
Looking ahead, the discount retailer expects third-quarter earnings from continuing operations to range between $0.14 and $0.19 per share, compared to the previous year's earnings from continuing operations of $0.15 per share. Comparable store sales for the third quarter are forecast to be in a range of flat to a 2% decline. Analysts are looking for earnings of $0.16 per share for the quarter.
For the fourth quarter, Big Lots projects earnings from continuing operations to be in the range of $0.99 - $1.04 per share versus income from continuing operations of $1.00 per share earned last year. The company anticipates fourth quarter comparable store sales to be in a range of flat to slightly up.
In addition, Big Lots, which offers products under Consumables, Home, Furniture, Hardlines, Seasonal and Other merchandising categories, lifted fiscal 2009 earnings from continuing operations target to $1.92 - $2.02 per share, from the previously communicated outlook range of $1.85 - $1.95 per share. Operating profit rate is estimated to be in the range of 5.6% - 5.9% for the full year. Wall Street analysts have a consensus earnings estimate of $1.93 per share for the full year, with a low estimate of $1.83 per share and a high estimate of $2.01 per share. Big Lots also raised its annual cash flow guidance to $155 million from $145 million.
Peer Performance
Among Big Lots' rival, Target Corp. (TGT) posted a 6.4% decline in second-quarter profit that amounted to $594 million or $0.79 per share from $634 million or $0.79 per share in the year-ago quarter, largely reflecting a 2.7% drop in retail sales and lower comparable store sales. Total revenues fell 2.6% to $15.07 billion from $15.47 billion in the previous year.
Another peer, Dollar Tree Inc. (DLTR) will report second-quarter results on August 26, with analysts expecting earnings of $0.54 per share. The company on August 6, reported second-quarter net sales of $1.22 billion, up 11.9% from $1.09 billion in the prior-year quarter. Comparable-store sales for the second quarter grew 6.8%, on top of a 6.5% increase reported for the second quarter of 2008.
Yet another competitor, Family Dollar Stores Inc. (FDO) reported third-quarter net income of $87.7 million or $0.62 per share, an increase from the prior-year's $64.7 million or $0.46 per share in the same period of last year, on higher sales, propelled by consumer traffic growth and strong consumables category performance. Quarterly net sales advanced to $1.84 billion from the previous year's sales of $1.70 billion, with comparable store sales growth of 6.2%.
Stock Quotes
Big Lots shares, which have been trading between $12.62 and $35.33 in the past 52 weeks, closed Monday's trading session at $24.03, up 22 cents or 0.92%, on a volume of 3.05 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.