COLUMBUS, Ohio, Aug. 30, 2019 /PRNewswire/ -- Big Lots, Inc.
(NYSE: BIG) today reported income of $6.2
million, or $0.16 per diluted
share, for the second quarter of fiscal 2019 ended August 3, 2019. This result includes after tax
charges totaling $14.5 million, or
$0.37 per diluted share, associated
with the implementation of our strategic business transformation.
Excluding these charges, adjusted income totaled $20.6 million, or $0.53 per diluted share (see non-GAAP table
included later in this release), which compares to our guidance of
adjusted income of $0.35 to
$0.45 per diluted share (non-GAAP).
Income for the second quarter of fiscal 2018 was $24.2 million, or $0.59 per diluted share.
Comparable store sales increased 1.2% for the second quarter of
fiscal 2019, compared to our guidance of an increase in the low
single digits. Net sales for the second quarter of fiscal 2019
totaled $1,252 million, a 2.5%
increase compared to $1,222 million
for the same period last year, with the increase resulting from
positive comparable store sales and sales growth in high volume new
stores, or non-comp stores, partially offset by a lower store count
year-over-year.
Commenting on today's announcement, Bruce Thorn, President and CEO of Big Lots
stated, "We are pleased with our performance for the second
quarter, which was in line with our sales guidance and ahead on
earnings. Going forward, despite the current tariff headwinds, we
are confident we will be able to navigate through this environment
to deliver a good outcome for 2019. More significantly, I am highly
encouraged by the progress we have made over the last 90 days on
our strategic transformation. Our existing initiatives are working,
and we have important new strategies in progress to drive
profitable long-term growth and deliver value to our
shareholders."
|
Earnings per diluted
share
|
|
|
|
|
|
|
|
|
Q2 2019
|
|
Q2 2018
|
|
|
|
|
|
|
|
Earnings per diluted
share
|
|
$0.16
|
|
$0.59
|
|
Impact of costs
associated with the implementation
|
|
|
|
|
|
of our strategic
business transformation review (1)
|
|
$0.37
|
|
-
|
|
|
|
|
|
|
|
Earnings per diluted
share - adjusted basis
|
|
$0.53
|
|
$0.59
|
|
|
|
|
|
|
|
(1) Non-GAAP
detailed reconciliation provided in our statements
below.
|
Inventory and Cash Management
Inventory ended the second quarter of fiscal 2019 at
$874 million compared to $854 million for the same period last year with
the 2% increase resulting from moving forward inventory commitments
to support earlier resets of new assortments in the key categories
of Furniture and Soft Home, and the slower than anticipated sell
through of seasonally sensitive product in Q2 largely due to
weather. This growth was partially offset by a lower store count
year-over-year.
We ended the second quarter of fiscal 2019 with $54 million of Cash and Cash Equivalents and
$468 million of borrowings under our
credit facility compared to $58
million of Cash and Cash Equivalents and $325 million of borrowings under our credit
facility as of the end of the second quarter of fiscal 2018. Our
increase in borrowings is a result of elevated investments in
strategic initiatives to support future growth and higher inventory
levels as noted above.
Total Cash Returned To Shareholders
As announced in a separate press release earlier today, on
August 28, 2019, our Board of
Directors declared a quarterly cash dividend of $0.30 per common share. This dividend payment of
approximately $12 million is payable
on September 27, 2019, to
shareholders of record as of the close of business on September 13, 2019. Year-to-date, approximately
$75 million has been returned to
shareholders in the form of share repurchases and dividend
payments.
FISCAL Q3 2019 GUIDANCE (non-GAAP)
- Provides initial Q3 guidance for adjusted loss of
$0.15 to $0.25 per share (non-GAAP), compared to a loss of
$0.16 per share for the same period
last year
- Provides initial Q3 guidance for comparable store sales of
approximately flat
For the third quarter of fiscal 2019, we estimate an adjusted
loss in the range of $0.15 to
$0.25 per share (non-GAAP), compared
to a loss of $0.16 per share for the
third quarter of fiscal 2018. This guidance is based on comparable
store sales of approximately flat.
FISCAL 2019 GUIDANCE (non-GAAP)
- Maintains guidance for fiscal 2019 adjusted income in the
range of $3.70 to $3.85 per diluted share (non-GAAP)
- Updates guidance for fiscal 2019 comparable store sales of
flat to slightly positive
Based on the actual results for the first two quarters and our
expectations for the third quarter of fiscal 2019 noted above, we
are maintaining our guidance for the full year of fiscal 2019 of
adjusted income in the range of $3.70
to $3.85 per diluted share
(non-GAAP). This compares to adjusted income of $4.04 per diluted share (non-GAAP) for fiscal
2018. This outlook is based on a comparable store sales increase of
flat to slightly positive. The level of non-GAAP items on an
after-tax basis is expected to be in the range of $36 million, or $0.90 per diluted share, for the fiscal year. We
estimate cash flow (cash provided by operating activities less
capital expenditures) to be approximately $75 million as compared to our prior guidance of
$65 million.
|
|
Full Year
|
|
|
|
|
|
|
|
|
|
2019 Guidance
(1)
|
|
2018
(2)
|
|
|
|
|
|
|
|
Earnings per diluted
share
|
|
$2.80 -
$2.95
|
|
$3.83
|
|
Non-GAAP
items
|
|
~$0.90
|
|
$0.21
|
|
Earnings per diluted
share - adjusted basis
|
|
$3.70 -
$3.85
|
|
$4.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Non-GAAP
items in fiscal 2019 principally relate to our strategic business
transformation review.
|
(2) Non-GAAP
detailed reconciliation provided in our statements
below.
|
Conference Call/Webcast
We will host a conference call today at 8:00 a.m. to discuss our financial results for
the second quarter of fiscal 2019 and provide commentary on our
outlook for fiscal 2019. We invite you to listen to the webcast of
the conference call through the Investor Relations section of our
website http://www.biglots.com. If you are unable to join the live
webcast, an archive of the call will be available through the
Investor Relations section of our website
http://www.biglots.com/after 12:00 noon today and will remain
available through midnight on Friday,
September 13, 2019. A replay of this call will also be
available beginning today at 12:00 noon through September 13 by dialing 1.877.660.6853 (Toll
Free) or 1.201.612.7415 (Toll) and entering Replay Conference ID
13694043. All times are Eastern Time.
Headquartered in Columbus,
Ohio, Big Lots, Inc. (NYSE: BIG) is a discount retailer
operating 1,415 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. Our mission is to help people Live BIG and Save
Lots. We strive to be the BIG difference for a better life by
delivering unmatched value to our customers through surprise and
delight, being a "best places to work" culture for our associates,
rewarding our shareholders with consistent growth and top tier
returns, and doing good in our communities as we do 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 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 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, 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.
You are cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date thereof. We undertake
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 we
make on related subjects in our public announcements and SEC
filings.
BIG LOTS, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
AUGUST
3
|
|
AUGUST
4
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$53,705
|
|
$58,457
|
|
|
|
Inventories
|
|
874,058
|
|
854,192
|
|
|
|
Other current
assets
|
|
112,675
|
|
140,393
|
|
|
|
Total
current assets
|
|
1,040,438
|
|
1,053,042
|
|
|
|
|
|
|
|
|
|
|
Operating lease
right-of-use assets
|
|
1,208,349
|
|
0
|
|
|
|
|
|
|
|
|
|
|
Property and
equipment - net
|
|
860,648
|
|
701,672
|
|
|
|
|
|
|
|
|
|
|
Deferred income
taxes
|
|
16,077
|
|
23,664
|
|
|
Other
assets
|
|
66,783
|
|
50,352
|
|
|
|
|
|
$3,192,295
|
|
$1,828,730
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$345,355
|
|
$355,721
|
|
|
|
Current operating
lease liabilities
|
|
239,592
|
|
0
|
|
|
|
Property, payroll
and other taxes
|
|
86,177
|
|
84,008
|
|
|
|
Accrued operating
expenses
|
|
206,733
|
|
120,761
|
|
|
|
Insurance
reserves
|
|
37,745
|
|
37,787
|
|
|
|
Accrued salaries
and wages
|
|
35,192
|
|
22,942
|
|
|
|
Income taxes
payable
|
|
614
|
|
1,266
|
|
|
|
Total
current liabilities
|
|
951,408
|
|
622,485
|
|
|
|
|
|
|
|
|
|
|
Long-term
obligations under bank credit facility
|
|
467,800
|
|
324,700
|
|
|
|
|
|
|
|
|
|
|
Noncurrent
operating lease liabilities
|
|
1,021,130
|
|
0
|
|
|
Deferred
rent
|
|
0
|
|
58,296
|
|
|
Insurance
reserves
|
|
52,122
|
|
56,321
|
|
|
Unrecognized tax
benefits
|
|
13,381
|
|
15,451
|
|
|
Synthetic lease
obligation
|
|
0
|
|
98,213
|
|
|
Other
liabilities
|
|
41,911
|
|
47,539
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
644,543
|
|
605,725
|
|
|
|
|
|
$3,192,295
|
|
$1,828,730
|
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
13 WEEKS
ENDED
|
|
13 WEEKS
ENDED
|
|
|
|
AUGUST 3,
2019
|
|
AUGUST 4,
2018
|
|
|
|
|
%
|
|
|
%
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$1,252,414
|
100.0
|
|
$1,222,169
|
100.0
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
498,230
|
39.8
|
|
491,419
|
40.2
|
|
|
|
|
|
|
|
|
|
Selling and
administrative expenses
|
|
455,026
|
36.3
|
|
426,605
|
34.9
|
|
|
|
|
|
|
|
|
|
Depreciation
expense
|
|
30,023
|
2.4
|
|
30,496
|
2.5
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
13,181
|
1.1
|
|
34,318
|
2.8
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(4,565)
|
(0.4)
|
|
(2,407)
|
(0.2)
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
(789)
|
(0.1)
|
|
149
|
0.0
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
|
7,827
|
0.6
|
|
32,060
|
2.6
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
1,649
|
0.1
|
|
7,896
|
0.6
|
|
|
|
|
|
|
|
|
Net
income
|
|
$6,178
|
0.5
|
|
$24,164
|
2.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$0.16
|
|
|
$0.59
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$0.16
|
|
|
$0.59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
39,000
|
|
|
41,061
|
|
|
|
|
|
|
|
|
|
|
Dilutive effect of
share-based awards
|
|
77
|
|
|
220
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
39,077
|
|
|
41,281
|
|
|
|
|
|
|
|
|
|
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)
|
|
|
|
|
|
|
|
|
|
|
|
26 WEEKS
ENDED
|
|
26 WEEKS
ENDED
|
|
|
|
AUGUST 3,
2019
|
|
AUGUST 4,
2018
|
|
|
|
|
%
|
|
|
%
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$2,548,210
|
100.0
|
|
$2,490,152
|
100.0
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
1,017,277
|
39.9
|
|
1,003,377
|
40.3
|
|
|
|
|
|
|
|
|
|
Selling and
administrative expenses
|
|
915,631
|
35.9
|
|
864,697
|
34.7
|
|
|
|
|
|
|
|
|
|
Depreciation
expense
|
|
62,820
|
2.5
|
|
59,025
|
2.4
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
38,826
|
1.5
|
|
79,655
|
3.2
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(8,298)
|
(0.3)
|
|
(3,983)
|
(0.2)
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
121
|
0.0
|
|
657
|
0.0
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
|
30,649
|
1.2
|
|
76,329
|
3.1
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
8,931
|
0.4
|
|
20,926
|
0.8
|
|
|
|
|
|
|
|
|
Net
income
|
|
$21,718
|
0.9
|
|
$55,403
|
2.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$0.55
|
|
|
$1.33
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$0.55
|
|
|
$1.33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
39,461
|
|
|
41,587
|
|
|
|
|
|
|
|
|
|
|
Dilutive effect of
share-based awards
|
|
83
|
|
|
106
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
39,544
|
|
|
41,693
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
|
$0.60
|
|
|
$0.60
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
13 WEEKS
ENDED
|
|
13 WEEKS
ENDED
|
|
|
|
|
|
AUGUST 3,
2019
|
|
AUGUST 4,
2018
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
Net cash
provided by operating activities
|
|
100,850
|
|
$13,675
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
used in investing activities
|
|
(85,965)
|
|
(105,989)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
(used in) provided by financing activities
|
|
(24,752)
|
|
85,941
|
|
|
|
|
|
|
|
|
|
|
Decrease in cash
and cash equivalents
|
|
(9,867)
|
|
(6,373)
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
|
|
|
Beginning
of period
|
|
63,572
|
|
64,830
|
|
|
|
End of
period
|
|
$53,705
|
|
58,457
|
|
|
BIG LOTS, INC. AND
SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
26 WEEKS
ENDED
|
|
26 WEEKS
ENDED
|
|
|
|
|
|
AUGUST 3,
2019
|
|
AUGUST 4,
2018
|
|
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
Net cash
provided by operating activities
|
|
$158,285
|
|
$110,560
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
used in investing activities
|
|
(162,731)
|
|
(171,426)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash
provided by financing activities
|
|
12,117
|
|
68,147
|
|
|
|
|
|
|
|
|
|
|
Increase in cash
and cash equivalents
|
|
7,671
|
|
7,281
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
|
|
|
Beginning
of period
|
|
46,034
|
|
51,176
|
|
|
|
End of
period
|
|
$53,705
|
|
$58,457
|
|
|
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, operating profit, operating profit rate, income tax
expense, effective income tax rate, net income, and diluted
earnings per share for the second 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 operating profit, adjusted
operating profit rate, adjusted income tax expense, adjusted
effective income tax rate, adjusted net income, and adjusted
diluted earnings per share (non-GAAP financial measures).
Second
quarter of 2019 - Thirteen weeks ended August 3,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Impact to
exclude
transformational
restructuring costs
|
|
As
Adjusted
(non-GAAP)
|
Selling and
administrative expenses
|
455,026
|
|
(19,452)
|
|
435,574
|
Selling and
administrative expense rate
|
36.3%
|
|
(1.6%)
|
|
34.8%
|
Operating
profit
|
|
13,181
|
|
19,452
|
|
32,633
|
Operating
profit rate
|
|
1.1%
|
|
1.6%
|
|
2.6%
|
Income tax
expense
|
|
1,649
|
|
4,993
|
|
6,642
|
Effective
income tax rate
|
|
21.1%
|
|
3.2%
|
|
24.3%
|
Net
income
|
|
6,178
|
|
14,459
|
|
20,637
|
Diluted
earnings per share
|
|
$
0.16
|
|
$
0.37
|
|
$
0.53
|
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 accounting principles generally accepted in
the United States of America
("GAAP") the costs associated with a transformational restructuring
initiative of $19,452 ($14,459, net of tax).
Year-to-date
2019 - Twenty-six weeks ended August 3, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Impact to
exclude
department exit
inventory
impairment
|
|
Impact to
exclude
transformational
restructuring costs
|
|
Adjustment
to
exclude legal
settlement loss
contingencies
|
|
As
Adjusted
(non-GAAP)
|
Gross
margin
|
|
$
1,017,277
|
|
$
6,050
|
|
$
-
|
|
$
-
|
|
$
1,023,327
|
Gross margin
rate
|
|
39.9%
|
|
0.2%
|
|
-
|
|
-
|
|
40.2%
|
Selling and
administrative expenses
|
915,631
|
|
-
|
|
(34,785)
|
|
(7,250)
|
|
873,596
|
Selling and
administrative expense rate
|
35.9%
|
|
-
|
|
(1.4%)
|
|
(0.3%)
|
|
34.3%
|
Operating
profit
|
|
38,826
|
|
6,050
|
|
34,785
|
|
7,250
|
|
86,911
|
Operating
profit rate
|
|
1.5%
|
|
0.2%
|
|
1.4%
|
|
0.3%
|
|
3.4%
|
Income tax
expense
|
|
8,931
|
|
1,553
|
|
8,928
|
|
1,696
|
|
21,108
|
Effective
income tax rate
|
|
29.1%
|
|
(0.4%)
|
|
(1.2%)
|
|
(0.7%)
|
|
26.8%
|
Net
income
|
|
21,718
|
|
4,497
|
|
25,857
|
|
5,554
|
|
57,626
|
Diluted
earnings per share
|
|
$
0.55
|
|
$
0.11
|
|
$
0.65
|
|
$
0.14
|
|
$
1.46
|
The above adjusted gross margin, adjusted gross margin rate,
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) 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
$34,785 ($25,857, net of tax); and (3) a pretax charge
related to estimated legal settlement of employee class actions of
$7,250 ($5,554, net of tax).
Year-to-date
2018 - Twenty-six weeks ended August 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported
|
|
Adjustment
to
exclude CEO
retirement costs
|
|
Adjustment
to
exclude
shareholder
litigation matter
|
|
As
Adjusted
(non-GAAP)
|
Selling and
administrative expenses
|
$
864,697
|
|
$
(7,018)
|
|
$
(3,500)
|
|
$
854,179
|
Selling and
administrative expense rate
|
34.7%
|
|
(0.3%)
|
|
(0.1%)
|
|
34.3%
|
Operating
profit
|
|
79,655
|
|
7,018
|
|
3,500
|
|
90,173
|
Operating
profit rate
|
|
3.2%
|
|
0.3%
|
|
0.1%
|
|
3.6%
|
Income tax
expense
|
|
20,926
|
|
895
|
|
879
|
|
22,700
|
Effective
income tax rate
|
|
27.4%
|
|
(1.0%)
|
|
(0.3%)
|
|
26.1%
|
Net
income
|
|
55,403
|
|
6,123
|
|
2,621
|
|
64,147
|
Diluted
earnings per share
|
|
$
1.33
|
|
$
0.15
|
|
$
0.06
|
|
$
1.54
|
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.