Big Lots on Friday reported soft comparable-store sales and a revenue decline but raised its profit forecast for the year.
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The Ohio-based company buys a range of merchandise discounted as a result of liquidations, production overruns and packaging changes and sells it at significantly lower prices than traditional discount retailers.
Sales at stores open at least 15 months increased 0.3%, on the low end of the company's projected range of between flat and 2%. Revenue fell as the comparable store increase was offset by a smaller number of stores.
The underwhelming results followed fellow discounters Dollar General Corp. and Dollar Tree Inc. which also reported lower comparable results than the prior period.
For the current year, Big Lots now expects adjusted per-share earnings of $3.45 to $3.55, up from its previous forecast of between $3.35 and $3.50 a share. Analysts polled by Thomson Reuters had expected earnings of $3.47. The company said it expects comparable-store sales to increase in the low-single-digits, reaffirming its previous quarter.
For the third quarter, the company estimates adjusted earnings per share in the range of a 4 cent loss to a 1 cent gain. Analysts are expecting a 1 cent loss.
In all for the quarter ended July 30, Big Lots reported a profit of $45 million, or 50 cents a share, up from $17.6 million, or 34 cents a share, a year prior. The number of shares outstanding fell 12%.
Excluding legacy pension costs and other charges, Big Lots posted an adjusted profit of 52 cents a share.
Revenue fell 0.5% to $1.2 billion. Analysts had expected revenue of $1.22 billion and profit of 46 cents.
Gross margin increased to 40.4% from 39.3%.
Shares in the company, up 18% over the past three months, were inactive premarket.
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