COLUMBUS, Ohio, May 25 /PRNewswire-FirstCall/ -- Big Lots, Inc.
(NYSE:BLI) today reported first quarter fiscal 2006 income from
continuing operations of $14.5 million, or $0.13 per diluted share,
compared to income from continuing operations of $7.3 million, or
$0.06 per diluted share, in the first quarter of fiscal 2005,
exceeding Thomson Financial/First Call's consensus first quarter
earnings estimate of $0.05 per share. Including the impact of
discontinued operations, first quarter fiscal 2006 net income
totaled $13.7 million, or $0.12 per diluted share, compared to $7.8
million, or $0.07 per diluted share, in the prior year. As
discussed in the Company's Form 10-K filed with the SEC on April
13, 2006, the Company's fiscal 2005 results from continuing
operations do not include the 130 stores closed in January 2006
that are classified as discontinued operations. (Logo:
http://www.newscom.com/cgi-bin/prnh/20011026/BIGLOTSLOGO ) FIRST
QUARTER HIGHLIGHTS - Earnings per share from continuing operations
of $0.13 versus $0.06 last year, an increase of 117% - Expenses as
percent of sales improved 140 basis points to 38.2% versus 39.6%
last year - Record cash flow results - Record inventory turnover
performance First Quarter Results Net sales for the first quarter
ended April 29, 2006, increased 4.7% to $1,091.6 million, compared
to $1,043.1 million for the same period in fiscal 2005. Comparable
store sales for stores open at least two years at the beginning of
the fiscal year increased 2.5% for the quarter. Operating income
from continuing operations for the first quarter of fiscal 2006
increased 70% to $21.3 million, compared to $12.5 million for the
same period last year, with the improvement to last year driven by
the Company's 2.5% comparable store sales increase along with
significant expense leverage for the quarter. Expenses as a percent
of sales improved by 140 basis points for the quarter due to
improving efficiencies in stores and distribution centers along
with benefits from cost reduction actions taken as part of the
Company's previously discussed WIN strategy. Expense leverage for
the quarter was partially offset by pressure in gross margin. The
gross margin rate for the quarter declined 60 basis points compared
to last year due to a slight shift in merchandise mix towards lower
margin categories, such as consumables and hardlines, and the
continued impact of rising fuel prices on the cost of inbound
freight. For the first quarter, the Company recorded net interest
income of $0.3 million, a $1.4 million improvement to last year's
net interest expense of $1.1 million. The improvement in interest
for the first quarter was directly attributed to the improved cash
generation of the business over the last 12 months. Inventory and
Cash Management Inventory ended the quarter at $806 million, down
10% or $91 million compared to last year. The 10% decline in
inventory was due to a 7% decline in store count coupled with a 3%
decline in average inventory carried per store. The combination of
improving disciplines around inventory management and improving
sales trends led to record inventory turnover performance for the
first quarter of fiscal 2006. The inventory turnover performance
combined with improving operating results and low levels of capital
spending resulted in record cash flow performance for the first
quarter. The Company generated $104 million of cash flow (defined
as cash provided by operating activities less cash used by
investing activities) for the first quarter of fiscal 2006,
compared to approximately $60 million of cash flow generated in the
same period last year. Share Repurchase Update As announced in
February of 2006, the Company's Board of Directors authorized the
repurchase of up to $150 million of the Company's common shares.
From February 24, 2006 (following approval of the program by the
Company's Board of Directors) through the end of the quarter on
April 29, 2006, the Company purchased 2,345,400 shares at a total
cost of $31.2 million. FINANCIAL OUTLOOK - Provides initial Q2
Sales and EPS guidance - Increases annual EPS guidance to a range
of $0.44 to $0.49 per diluted share - Increases annual inventory
turnover guidance - Increases annual cash flow guidance to $140
million For the second quarter of fiscal 2006, the Company's
guidance calls for a 1% to 4% comparable store sales increase with
net sales estimated to be in the range of $1,015 million to $1,045
million. The Company expects that the operating income rate as a
percent of sales will improve compared to the prior year as
continued expense leverage will be only partially offset by an
anticipated decline in the gross margin rate. Based on these
assumptions, the Company estimates a loss from continuing
operations of $0.07 to $0.10 per share for the second quarter of
fiscal 2006, compared to a loss from continuing operations of $0.11
per share for the second quarter of fiscal 2005. Based on the
strength of the first quarter operating results, the Company raised
its fiscal 2006 guidance for earnings, inventory turnover, and cash
flow. Earnings from continuing operations are now expected to be in
the range of $0.44 to $0.49 per diluted share, an increase from
prior guidance which called for earnings from continuing operations
of $0.38 to $0.43 per diluted share. The Company's annual earnings
expectations for fiscal 2006 compare favorably to earnings from
continuing operations of $0.14 per diluted share for fiscal 2005.
For fiscal 2006, inventory turnover is now anticipated to be in the
range of 3.1 to 3.2, up from prior guidance of 3.1. Given the
increase in annual earnings and inventory turnover guidance, the
Company increased its fiscal 2006 cash flow guidance to $140
million from its prior guidance of $120 million. All cash flow
estimates exclude the impact of the Company's share repurchase
program mentioned earlier in this release. Conference Call/Webcast
The Company will host a conference call today at 8:00 a.m. Eastern
Time to discuss the Company's financial results for the first
quarter of fiscal 2006. The Company invites you to listen to the
live webcast of the conference call. The Company is hosting the
live webcast at http://www.biglots.com/. If you are unable to join
the live webcast, an archive of the call will be available at
http://www.biglots.com/ in the Investor Relations section of our
website two hours after the call ends and will remain available
through midnight on Thursday, June 8. A replay of the call will be
available beginning May 25 at 12:00 noon (Eastern Time) through
June 8 at midnight by dialing: 1.800.207.7077 (United States and
Canada) or 1.913.383.5767 (International or metro-Seattle). The PIN
number is 4783. Big Lots is the nation's largest broadline closeout
retailer. The Company currently operates 1,401 BIG LOTS stores in
47 states. Wholesale operations are conducted through BIG LOTS
WHOLESALE, CONSOLIDATED INTERNATIONAL, WISCONSIN TOY and with
online sales at http://www.biglotswholesale.com/. The Company's
website is located at http://www.biglots.com/. Cautionary Statement
Concerning Forward-Looking Statements Certain statements in this
release are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, and such
statements are intended to qualify for the protection of the safe
harbor provided by that Act. The words "anticipate," "estimate,"
"expect," "objective," "goal," "project," "intend," "plan,"
"believe," "will," "target," "forecast" and similar expressions
generally identify forward-looking statements. Similarly,
descriptions of our objectives, strategies, plans, goals or targets
are also forward-looking statements. Forward-looking statements
relate to the expectations of management as to future occurrences
and trends, including statements expressing optimism or pessimism
about future operating results or events and projected sales,
earnings, capital expenditures and business strategy.
Forward-looking statements are based upon a number of assumptions
concerning future conditions that may ultimately prove to be
inaccurate. Forward-looking statements are and will be based upon
management's then-current views and assumptions regarding future
events and operating performance, and are applicable only as of the
dates of such statements. Although we believe the expectations
expressed in forward-looking statements are based on reasonable
assumptions within the bounds of our knowledge, forward-looking
statements, by their nature, involve risks, uncertainties and other
factors, any one or a combination of which could materially affect
our business, financial condition, results of operations or
liquidity. Forward-looking statements that we make herein and in
other reports and releases are not guarantees of future performance
and actual results may differ materially from those in such
forward-looking statements as a result of various factors,
including the cost of goods, our inability to successfully execute
strategic initiatives, competitive pressures, economic pressures on
our customers and us, the availability of brand name closeout
merchandise, trade restrictions, freight costs, the risks discussed
in the Risk Factors section of our most recent Annual Report on
Form 10-K, and other factors discussed from time to time in our
other filings with the SEC, including Quarterly Reports on Form
10-Q and Current Reports on Form 8-K. This release should be read
in conjunction with such filings, and you should consider all of
these risks, uncertainties and other factors carefully in
evaluating forward-looking statements. BIG LOTS, INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In
thousands, except per share data) 13 WEEKS ENDED 13 WEEKS ENDED
APRIL 29, 2006 APRIL 30, 2005 % % (Unaudited) (Unaudited) Net sales
$1,091,622 100.0 $1,043,084 100.0 Gross margin 438,322 40.2 425,658
40.8 Selling and administrative expenses 392,389 35.9 387,306 37.1
Depreciation expense 24,653 2.3 25,837 2.5 Operating income 21,280
1.9 12,515 1.2 Interest expense 90 0.0 1,174 0.1 Interest income
(394) (0.0) (31) (0.0) Income from continuing operations before
income taxes 21,584 2.0 11,372 1.1 Income tax expense 7,080 0.6
4,106 0.4 Income from continuing operations 14,504 1.3 7,266 0.7
(Loss) income from discontinued operations, net of tax benefit
(expense) of $506 and ($331), respectively (791) (0.1) 534 (0.0)
Net income $13,713 1.3 $7,800 0.7 Income (loss) per common share -
basic Continuing operations $0.13 $0.06 Discontinued operations
(0.01) 0.01 Net income $0.12 $0.07 Weighted average common shares
outstanding - basic 113,014 112,969 Income (loss) per common share
- diluted Continuing operations $0.13 $0.06 Discontinued operations
(0.01) 0.01 Net income $0.12 $0.07 Weighted average common shares
outstanding - diluted 114,508 113,343 BIG LOTS, INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)
APRIL 29, APRIL 30, 2006 2005 (Unaudited) (Unaudited) ASSETS
Current Assets: Cash and cash equivalents $74,541 $10,945
Inventories 805,604 897,030 Deferred income taxes 76,824 73,729
Other current assets 62,971 63,755 Total Current Assets 1,019,940
1,045,459 Property and equipment - net 563,661 637,031 Deferred
income taxes 23,813 20,051 Other assets 29,218 35,650 $1,636,632
$1,738,191 LIABILITIES AND SHAREHOLDERS' EQUITY Current
Liabilities: Accounts payable $184,768 $183,688 Property, payroll
and other taxes 107,788 110,429 Accrued operating expenses 58,084
42,901 Insurance reserves 47,212 48,422 KB lease obligation 27,163
32,482 Accrued salaries and wages 22,248 20,642 Other current
liabilities 11,687 12,906 Total Current Liabilities 458,950 451,470
Long-term obligations - 106,900 Deferred rent 40,809 41,701
Insurance reserves 44,436 37,630 Other liabilities 19,815 10,979
Shareholders' equity 1,072,622 1,089,511 $1,636,632 $1,738,191 BIG
LOTS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (In thousands) 13 WEEKS ENDED 13 WEEKS ENDED APRIL 29,
2006 APRIL 30, 2005 (Unaudited) (Unaudited) Net cash provided by
operating activities $109,934 $75,124 Net cash used in investing
activities (5,916) (15,274) Net cash used in financing activities
(31,187) (51,426) Increase in cash and cash equivalents 72,831
8,424 Cash and cash equivalents: Beginning of year 1,710 2,521 End
of quarter $74,541 $10,945
http://www.newscom.com/cgi-bin/prnh/20011026/BIGLOTSLOGO
http://photoarchive.ap.org/ DATASOURCE: Big Lots, Inc. CONTACT:
Timothy A. Johnson, Vice President, Strategic Planning and Investor
Relations of Big Lots, Inc., +1-614-278-6622 Web site:
http://www.biglots.com/ http://www.biglotswholesale.com/
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