COLUMBUS, Ohio, Dec. 6, 2019 /PRNewswire/ -- Big Lots, Inc.
(NYSE: BIG) today reported net income of $127.0 million, or $3.25 per diluted share, for the third quarter of
fiscal 2019 ended November 2, 2019.
This result includes an after-tax gain of $136.6 million, or $3.49 per diluted share, associated with the sale
of the company's distribution center in Rancho Cucamonga, California, as well as
after-tax expense of $2.6 million, or
$0.07 per diluted share, associated
with the implementation of the company's strategic business
transformation. Excluding these items, the adjusted net loss was
$7.0 million, or $0.18 per share (see non-GAAP table included
later in this release), which compares to guidance of an adjusted
net loss of $0.15 to $0.25 per share (non-GAAP). The net loss for the
third quarter of fiscal 2018 was $6.6
million, or $0.16 per
share.
Net sales for the third quarter of fiscal 2019 totaled
$1,168 million, a 1.6% increase
compared to $1,149 million for the
same period last year, with the increase resulting from sales
growth in high volume new and relocated non-comp stores, and a
slightly higher store count year-over-year. Comparable sales
decreased 0.1% for the third quarter of fiscal 2019, compared to
guidance of approximately flat.
Commenting on today's announcement, Bruce Thorn, President and CEO of Big Lots
stated, "We are pleased to have delivered operating results in line
with our guidance, while strengthening our balance sheet with the
proceeds from the sale of our California distribution center. I'm also
highly encouraged by the progress we are making on our
transformational strategies, as part of Operation North Star, to
drive profitable long-term growth and deliver value to our
shareholders. After a year of restructuring and transition in 2019,
and despite the ongoing impact of tariffs, we expect to return to
EBIT and EPS growth in 2020, including significant improvement in
normalized free cash flow."
|
Earnings per
share
|
|
|
|
|
|
|
|
|
Q3 2019
|
|
Q3 2018
|
|
|
|
|
|
|
|
Earnings per
share
|
|
$3.25 (1)
|
|
($0.16)
|
|
Gain on the sale of
the California distribution center (2)
|
|
($3.49)
(1)
|
|
-
|
|
Impact of the costs
associated with the implementation
|
|
|
|
|
|
of the strategic
transformation (2)
|
|
$0.07 (1)
|
|
-
|
|
|
|
|
|
|
|
Earnings per share -
adjusted basis
|
|
($0.18)
|
|
($0.16)
|
|
|
|
|
|
|
|
(1) Earnings
per diluted share
|
(2) Non-GAAP
detailed reconciliation provided in the statements below
|
Inventory and Cash Management
Inventory ended the third quarter of fiscal 2019 at $1,117 million compared to $1,074 million for the same period last year,
with the 4% increase resulting from planned year-over-year sales
increases and inventory builds in certain merchandise categories
including Furniture and Soft Home.
The company ended the third quarter of fiscal 2019 with
$62 million of Cash and Cash
Equivalents and $501 million of
long-term debt compared to $62
million of Cash and Cash Equivalents and $488 million of long-term debt as of the end of
the third quarter of fiscal 2018.
Dividend
As announced in a separate press release earlier today, on
December 4, 2019, the Board of
Directors declared a quarterly cash dividend of $0.30 per common share. This dividend payment of
approximately $12 million is payable
on December 30, 2019, to shareholders
of record as of the close of business on December 16, 2019. Year-to-date, approximately
$87 million has been returned to
shareholders in the form of share repurchases and dividend
payments.
FISCAL Q4 2019 GUIDANCE
- Initial Q4 guidance for net income of $2.40 to $2.55 per
diluted share, compared to net income of $2.68 per diluted share for the same period last
year
- Initial Q4 guidance for comparable sales up
slightly
For the fourth quarter of fiscal 2019, the company estimates net
income in the range of $2.40 to
$2.55 per diluted share, compared to
net income of $2.68 per diluted share
for the fourth quarter of fiscal 2018. This guidance is based on
comparable sales up slightly.
FISCAL 2019 GUIDANCE (non-GAAP)
- Maintaining guidance for fiscal 2019 adjusted net income in
the range of $3.70 to $3.85 per diluted share (non-GAAP)
Based on the actual results for the first three quarters and the
expectations for the fourth quarter of fiscal 2019 noted above, the
company is maintaining its guidance for the full year of fiscal
2019 of adjusted net income in the range of $3.70 to $3.85 per
diluted share (non-GAAP). This compares to adjusted net income of
$4.04 per diluted share (non-GAAP)
for fiscal 2018. The impact of non-GAAP items on an after-tax basis
is expected to be in the range of $98.1
million, or $2.49 per diluted
share, for the fiscal year. This includes the gain on the sale of
the California distribution
center. Cash consideration from the sale was $191 million and the company reinvested
$69 million of the proceeds to
exercise a purchase option on its corporate headquarters in
Columbus, Ohio, effected through a
qualified intermediary to accommodate a tax-deferred exchange. The
remaining proceeds from the sale were used to pay down the
outstanding balance on the company's unsecured line of credit.
|
|
Full Year
|
|
|
|
|
|
|
|
|
|
2019 Guidance
(1)
|
|
2018
(1)
|
|
|
|
|
|
|
|
Earnings per diluted
share
|
|
$6.20 -
$6.35
|
|
$3.83
|
|
Non-GAAP
items
|
|
~($2.49)
|
|
$0.21
|
|
Earnings per diluted
share - adjusted basis
|
|
$3.70 -
$3.85
|
|
$4.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Non-GAAP
detailed reconciliation provided in the statements below
|
Conference Call/Webcast
The company will host a
conference call today at 8:00 a.m. to
discuss the financial results for the third quarter of fiscal 2019
and provide commentary on the outlook for fiscal 2019. A webcast of
the conference call is available through the Investor Relations
section of the company's website http://www.biglots.com. An archive
of the call will be available through the Investor Relations
section of the company's website after 12:00 noon today and will
remain available through midnight on Friday,
December 20, 2019. A replay of this call will also be
available beginning today at 12:00 noon through December 20 by dialing 1.877.660.6853 (Toll Free)
or 1.201.612.7415 (Toll) and entering Replay Conference ID
13696724. All times are Eastern Time.
Headquartered in Columbus,
Ohio, Big Lots, Inc. (NYSE: BIG) is a discount retailer
operating 1,421 BIG LOTS stores in 47 states with product
assortments in the merchandise categories of Furniture, Seasonal,
Soft Home, Food, Consumables, Hard Home, and Electronics, Toys
& Accessories. The company's mission is to help people Live BIG
and Save Lots. The company strives to be the BIG difference for a
better life by delivering unmatched value to customers through
surprise and delight, being a "best places to work" culture for
associates, rewarding shareholders with consistent growth and top
tier returns, and doing good in communities as the company does
well. For more information about the company,
visit 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 the Act. The
words "anticipate," "estimate," "expect," "objective," "goal,"
"project," "intend," "plan," "believe," "will," "should," "may,"
"target," "forecast," "guidance," "outlook" and similar expressions
generally identify forward-looking statements. Similarly,
descriptions of 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 the company believes the expectations
expressed in forward-looking statements are based on reasonable
assumptions within the bounds of knowledge, forward-looking
statements, by their nature, involve risks, uncertainties and other
factors, any one or a combination of which could materially affect
business, financial condition, results of operations or
liquidity.
Forward-looking statements that the company makes herein and in
other reports and releases are not guarantees of future performance
and actual results may differ materially from those discussed in
such forward-looking statements as a result of various factors,
including, but not limited to, current economic and credit
conditions, the cost of goods, the inability to successfully
execute strategic initiatives, competitive pressures, economic
pressures on customers and the company, the availability of brand
name closeout merchandise, trade restrictions, freight costs, the
risks discussed in the Risk Factors section of the company's
most recent Annual Report on Form 10-K, and other factors discussed
from time to time in 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.
You are cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date thereof. The company
undertakes no obligation to publicly update forward-looking
statements, whether as a result of new information, future events
or otherwise. You are advised, however, to consult any further
disclosures the company makes on related subjects in public
announcements and SEC filings.
BIG LOTS, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
NOVEMBER
2
|
|
NOVEMBER
3
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$61,794
|
|
$61,938
|
|
|
|
Inventories
|
|
1,117,263
|
|
1,073,885
|
|
|
|
Other current
assets
|
|
82,495
|
|
141,424
|
|
|
|
Total
current assets
|
|
1,261,552
|
|
1,277,247
|
|
|
|
|
|
|
|
|
|
|
Operating lease
right-of-use assets
|
|
1,233,558
|
|
0
|
|
|
|
|
|
|
|
|
|
|
Property and
equipment - net
|
|
860,659
|
|
782,771
|
|
|
|
|
|
|
|
|
|
|
Deferred income
taxes
|
|
0
|
|
22,923
|
|
|
Other
assets
|
|
65,977
|
|
50,075
|
|
|
|
|
|
$3,421,746
|
|
$2,133,016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$475,995
|
|
$479,634
|
|
|
|
Current operating
lease liabilities
|
|
205,390
|
|
0
|
|
|
|
Property, payroll
and other taxes
|
|
87,357
|
|
85,775
|
|
|
|
Accrued operating
expenses
|
|
131,987
|
|
112,458
|
|
|
|
Insurance
reserves
|
|
36,534
|
|
38,070
|
|
|
|
Accrued salaries
and wages
|
|
38,004
|
|
28,342
|
|
|
|
Income taxes
payable
|
|
1,977
|
|
1,295
|
|
|
|
Total
current liabilities
|
|
977,244
|
|
745,574
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
501,115
|
|
488,000
|
|
|
|
|
|
|
|
|
|
|
Noncurrent
operating lease liabilities
|
|
1,067,529
|
|
0
|
|
|
Deferred income
taxes
|
|
8,316
|
|
0
|
|
|
Deferred
rent
|
|
0
|
|
61,054
|
|
|
Insurance
reserves
|
|
51,665
|
|
55,769
|
|
|
Unrecognized tax
benefits
|
|
12,913
|
|
12,738
|
|
|
Synthetic lease
obligation
|
|
0
|
|
131,644
|
|
|
Other
liabilities
|
|
40,640
|
|
45,505
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
762,324
|
|
592,732
|
|
|
|
|
|
$3,421,746
|
|
$2,133,016
|
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
13 WEEKS
ENDED
|
|
13 WEEKS
ENDED
|
|
|
|
NOVEMBER 2,
2019
|
|
NOVEMBER 3,
2018
|
|
|
|
|
%
|
|
|
%
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$1,167,988
|
100.0
|
|
$1,149,402
|
100.0
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
463,386
|
39.7
|
|
459,174
|
39.9
|
|
|
|
|
|
|
|
|
|
Selling and
administrative expenses
|
|
436,714
|
37.4
|
|
436,826
|
38.0
|
|
|
|
|
|
|
|
|
|
Depreciation
expense
|
|
34,752
|
3.0
|
|
31,911
|
2.8
|
|
|
|
|
|
|
|
|
|
Gain on sale of
distribution center
|
|
(178,534)
|
(15.3)
|
|
0
|
0.0
|
|
|
|
|
|
|
|
|
Operating profit
(loss)
|
|
170,454
|
14.6
|
|
(9,563)
|
(0.8)
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(5,359)
|
(0.5)
|
|
(3,138)
|
(0.3)
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
(322)
|
(0.0)
|
|
59
|
0.0
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes
|
|
164,773
|
14.1
|
|
(12,642)
|
(1.1)
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
|
37,791
|
3.2
|
|
(6,086)
|
(0.5)
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$126,982
|
10.9
|
|
($6,556)
|
(0.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$3.25
|
|
|
($0.16)
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$3.25
|
|
|
($0.16)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
39,017
|
|
|
40,021
|
|
|
|
|
|
|
|
|
|
|
Dilutive effect of
share-based awards
|
|
77
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
39,094
|
|
|
40,021
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
|
$0.30
|
|
|
$0.30
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
39 WEEKS
ENDED
|
|
39 WEEKS
ENDED
|
|
|
|
NOVEMBER 2,
2019
|
|
NOVEMBER 3,
2018
|
|
|
|
|
%
|
|
|
%
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$3,716,198
|
100.0
|
|
$3,639,554
|
100.0
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
1,480,663
|
39.8
|
|
1,462,551
|
40.2
|
|
|
|
|
|
|
|
|
|
Selling and
administrative expenses
|
|
1,352,345
|
36.4
|
|
1,301,523
|
35.8
|
|
|
|
|
|
|
|
|
|
Depreciation
expense
|
|
97,572
|
2.6
|
|
90,936
|
2.5
|
|
|
|
|
|
|
|
|
|
Gain on sale of
distribution center
|
|
(178,534)
|
(4.8)
|
|
0
|
0.0
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
209,280
|
5.6
|
|
70,092
|
1.9
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(13,657)
|
(0.4)
|
|
(7,121)
|
(0.2)
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
(201)
|
(0.0)
|
|
716
|
0.0
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
|
195,422
|
5.3
|
|
63,687
|
1.7
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
46,722
|
1.3
|
|
14,840
|
0.4
|
|
|
|
|
|
|
|
|
Net
income
|
|
$148,700
|
4.0
|
|
$48,847
|
1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$3.78
|
|
|
$1.19
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$3.77
|
|
|
$1.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
39,313
|
|
|
41,065
|
|
|
|
|
|
|
|
|
|
|
Dilutive effect of
share-based awards
|
|
85
|
|
|
138
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
39,398
|
|
|
41,203
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
|
$0.90
|
|
|
$0.90
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
13 WEEKS
ENDED
|
|
13 WEEKS
ENDED
|
|
|
|
|
|
NOVEMBER 2,
2019
|
|
NOVEMBER 3,
2018
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
Net cash
used in operating activities
|
|
($77,737)
|
|
($70,140)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
provided by (used in) investing activities
|
|
121,500
|
|
(109,607)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
(used in) provided by financing activities
|
|
(35,674)
|
|
183,228
|
|
|
|
|
|
|
|
|
|
|
Increase in cash
and cash equivalents
|
|
8,089
|
|
3,481
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
|
|
|
Beginning
of period
|
|
53,705
|
|
58,457
|
|
|
|
End of
period
|
|
$61,794
|
|
$61,938
|
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
39 WEEKS
ENDED
|
|
39 WEEKS
ENDED
|
|
|
|
|
|
NOVEMBER 2,
2019
|
|
NOVEMBER 3,
2018
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
Net cash
provided by operating activities
|
|
$80,548
|
|
$40,420
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
used in investing activities
|
|
(41,231)
|
|
(281,033)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
(used in) provided by financing activities
|
|
(23,557)
|
|
251,375
|
|
|
|
|
|
|
|
|
|
|
Increase in cash
and cash equivalents
|
|
15,760
|
|
10,762
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
|
|
|
Beginning
of period
|
|
46,034
|
|
51,176
|
|
|
|
End of
period
|
|
$61,794
|
|
$61,938
|
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
(In thousands, except per share
data)
(Unaudited)
The following tables reconcile: gross margin, gross margin rate,
selling and administrative expenses, selling and administrative
expense rate, gain on sale of distribution center, gain on sale of
distribution center rate, operating profit (loss), operating profit
(loss) rate, income tax expense (benefit), effective income tax
rate, net income (loss), and diluted earnings (loss) per share for
the third quarter of 2019, the year-to-date 2019, the year-to-date
2018, and the full year 2018 (GAAP financial measures) to adjusted
gross margin, adjusted gross margin rate, adjusted selling and
administrative expenses, adjusted selling and administrative
expense rate, adjusted gain on sale of distribution center,
adjusted gain on sale or distribution center rate, adjusted
operating profit (loss), adjusted operating profit (loss) rate,
adjusted income tax expense (benefit), adjusted effective income
tax rate, adjusted net income (loss), and adjusted diluted earnings
(loss) per share (non-GAAP financial measures).
Third
quarter of 2019 - Thirteen weeks ended November 2,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Impact to
exclude
transformational
restructuring costs
|
|
Adjustment
to
exclude gain on
sale of distribution
center
|
|
As
Adjusted
(non-GAAP)
|
Selling and
administrative expenses
|
$
436,714
|
|
$
(3,553)
|
|
$
-
|
|
$
433,161
|
Selling and
administrative expense rate
|
37.4%
|
|
(0.3%)
|
|
-
|
|
37.1%
|
Gain on sale
of distribution center
|
(178,534)
|
|
-
|
|
178,534
|
|
-
|
Gain on sale
of distribution center rate
|
(15.3%)
|
|
-
|
|
15.3%
|
|
-
|
Operating
profit (loss)
|
|
170,454
|
|
3,553
|
|
(178,534)
|
|
(4,527)
|
Operating
profit (loss) rate
|
|
14.6%
|
|
0.3%
|
|
(15.3%)
|
|
(0.4%)
|
Income tax
expense (benefit)
|
37,791
|
|
908
|
|
(41,930)
|
|
(3,231)
|
Effective
income tax rate
|
|
22.9%
|
|
0.1%
|
|
8.7%
|
|
31.7%
|
Net income
(loss)
|
|
126,982
|
|
2,645
|
|
(136,604)
|
|
(6,977)
|
Diluted
earnings (loss) per share
|
$
3.25
|
|
$
0.07
|
|
$
(3.49)
|
|
$
(0.18)
|
The above adjusted selling and administrative expenses, adjusted
selling and administrative expense rate, adjusted gain on sale of
distribution center, adjusted gain on sale of distribution center
rate, adjusted operating profit (loss), adjusted operating profit
(loss) rate, adjusted income tax expense (benefit), adjusted
effective income tax rate, adjusted net income (loss), and adjusted
diluted earnings (loss) per share are "non-GAAP financial measures"
as that term is defined by Rule 101 of Regulation G (17 CFR Part
244) and Item 10 of Regulation S-K (17 CFR Part 229). These
non-GAAP financial measures exclude from the most directly
comparable financial measures calculated and presented in
accordance with accounting principles generally accepted in
the United States of America
("GAAP") (1) the costs associated with a transformational
restructuring initiative of $3,553
($2,645, net of tax); and (2) a gain
resulting from the sale of our Rancho
Cucamonga, California distribution center of $178,534 ($136,604,
net of tax).
Year-to-date
2019 - Thirty-nine weeks ended November 2,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Impact to
exclude
department exit
inventory
impairment
|
|
Impact to
exclude
transformational
restructuring costs
|
|
Adjustment
to
exclude legal
settlement loss
contingencies
|
|
Adjustment
to
exclude gain on
sale of distribution
center
|
|
As
Adjusted
(non-GAAP)
|
Gross
margin
|
|
$
1,480,663
|
|
$
6,050
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
1,486,713
|
Gross margin
rate
|
|
39.8%
|
|
0.2%
|
|
-
|
|
-
|
|
-
|
|
40.0%
|
Selling and
administrative expenses
|
1,352,345
|
|
-
|
|
(38,338)
|
|
(7,250)
|
|
-
|
|
1,306,757
|
Selling and
administrative expense rate
|
36.4%
|
|
-
|
|
(1.0%)
|
|
(0.2%)
|
|
-
|
|
35.2%
|
Gain on sale
of distribution center
|
(178,534)
|
|
-
|
|
-
|
|
-
|
|
178,534
|
|
-
|
Gain on sale
of distribution center rate
|
(4.8%)
|
|
-
|
|
-
|
|
-
|
|
4.8%
|
|
-
|
Operating
profit
|
|
209,280
|
|
6,050
|
|
38,338
|
|
7,250
|
|
(178,534)
|
|
82,384
|
Operating
profit rate
|
|
5.6%
|
|
0.2%
|
|
1.0%
|
|
0.2%
|
|
(4.8%)
|
|
2.2%
|
Income tax
expense
|
|
46,722
|
|
1,553
|
|
9,836
|
|
1,696
|
|
(41,930)
|
|
17,877
|
Effective
income tax rate
|
|
23.9%
|
|
0.0%
|
|
0.1%
|
|
(0.0%)
|
|
2.0%
|
|
26.1%
|
Net
income
|
|
148,700
|
|
4,497
|
|
28,502
|
|
5,554
|
|
(136,604)
|
|
50,649
|
Diluted
earnings per share
|
|
$
3.77
|
|
$
0.11
|
|
$
0.72
|
|
$
0.14
|
|
$
(3.47)
|
|
$
1.29
|
The above adjusted gross margin, adjusted gross margin rate,
adjusted selling and administrative expenses, adjusted selling and
administrative expense rate, adjusted gain on sale of distribution
center, adjusted gain on sale of distribution center rate, adjusted
operating profit, adjusted operating profit rate, adjusted income
tax expense, adjusted effective income tax rate, adjusted net
income, and adjusted diluted earnings per share are "non-GAAP
financial measures" as that term is defined by Rule 101 of
Regulation G (17 CFR Part 244) and Item 10 of Regulation S-K (17
CFR Part 229). These non-GAAP financial measures exclude from the
most directly comparable financial measures calculated and
presented in accordance with GAAP (1) an inventory impairment
amount of $6,050 ($4,497, net of tax) as a result of a merchandise
department exit; (2) the costs associated with a transformational
restructuring initiative of $38,338
($28,502, net of tax); (3) a pretax
charge related to estimated legal settlement of employee class
actions of $7,250 ($5,554, net of tax); and (4) a gain resulting
from the sale of our Rancho Cucamonga,
California distribution center of $178,534 ($136,604,
net of tax).
Year-to-date
2018 - Thirty-nine weeks ended November 3,
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Adjustment
to
exclude CEO
retirement costs
|
|
Adjustment
to
exclude
shareholder
litigation matter
|
|
As
Adjusted
(non-GAAP)
|
Selling and
administrative expenses
|
$
1,301,523
|
|
$
(7,018)
|
|
$
(3,500)
|
|
$
1,291,005
|
Selling and
administrative expense rate
|
35.8%
|
|
(0.2%)
|
|
(0.1%)
|
|
35.5%
|
Operating
profit
|
|
70,092
|
|
7,018
|
|
3,500
|
|
80,610
|
Operating
profit rate
|
|
1.9%
|
|
0.2%
|
|
0.1%
|
|
2.2%
|
Income tax
expense
|
|
14,840
|
|
895
|
|
879
|
|
16,614
|
Effective
income tax rate
|
|
23.3%
|
|
(0.6%)
|
|
(0.3%)
|
|
22.4%
|
Net
income
|
|
48,847
|
|
6,123
|
|
2,621
|
|
57,591
|
Diluted
earnings per share
|
|
$
1.19
|
|
$
0.15
|
|
$
0.06
|
|
$
1.40
|
The above adjusted selling and administrative expenses, adjusted
selling and administrative expense rate, adjusted operating profit,
adjusted operating profit rate, adjusted income tax expense,
adjusted effective income tax rate, adjusted net income, and
adjusted diluted earnings per share are "non-GAAP financial
measures" as that term is defined by Rule 101 of Regulation G (17
CFR Part 244) and Item 10 of Regulation S-K (17 CFR Part 229).
These non-GAAP financial measures exclude from the most directly
comparable financial measures calculated and presented in
accordance with GAAP (1) the costs associated with the retirement
of our former CEO of $7,018
($6,123, net of tax); and (2) a
pretax charge related to the settlement in principle of shareholder
litigation matters of $3,500
($2,621, net of tax).
Full Year
2018 - Fifty-two weeks ended February 2, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Adjustment
to
exclude CEO
retirement costs
|
|
Adjustment
to
exclude
shareholder
litigation matter
|
|
As
Adjusted
(non-GAAP)
|
Selling and
administrative expenses
|
$
1,778,416
|
|
$
(7,018)
|
|
$
(3,500)
|
|
$
1,767,898
|
Selling and
administrative expense rate
|
34.0%
|
|
(0.1%)
|
|
(0.1%)
|
|
33.8%
|
Operating
profit
|
|
218,509
|
|
7,018
|
|
3,500
|
|
229,027
|
Operating
profit rate
|
|
4.2%
|
|
0.1%
|
|
0.1%
|
|
4.4%
|
Income tax
expense
|
|
50,719
|
|
895
|
|
879
|
|
52,493
|
Effective
income tax rate
|
|
24.4%
|
|
(0.4%)
|
|
(0.0%)
|
|
24.1%
|
Net
income
|
|
156,894
|
|
6,123
|
|
2,621
|
|
165,638
|
Diluted
earnings per share
|
|
$
3.83
|
|
$
0.15
|
|
$
0.06
|
|
$
4.04
|
The above adjusted selling and administrative expenses, adjusted
selling and administrative expense rate, adjusted operating profit,
adjusted operating profit rate, adjusted income tax expense,
adjusted effective income tax rate, adjusted net income, and
adjusted diluted earnings per share are "non-GAAP financial
measures" as that term is defined by Rule 101 of Regulation G (17
CFR Part 244) and Item 10 of Regulation S-K (17 CFR Part 229).
These non-GAAP financial measures exclude from the most directly
comparable financial measures calculated and presented in
accordance with GAAP (1) the costs associated with the retirement
of our former CEO of $7,018
($6,123, net of tax); and (2) a
pretax charge related to the settlement in principle of shareholder
litigation matters of $3,500
($2,621, net of tax).
Our management believes that the disclosure of these non-GAAP
financial measures provides useful information to investors because
the non-GAAP financial measures present an alternative and more
relevant method for measuring our operating performance, excluding
special items included in the most directly comparable GAAP
financial measures, that management believes is more indicative of
our on-going operating results and financial condition. Our
management uses these non-GAAP financial measures, along with the
most directly comparable GAAP financial measures, in evaluating our
operating performance.
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SOURCE Big Lots, Inc.