Big Lots raises outlook after smaller-than-expected loss
(Reuters) - A smaller-than-expected quarterly loss prompted close-out retailer Big Lots Inc (BIG.N) to raise its full-year adjusted earnings forecast, heading into the holiday season.
Big Lots shares, which have lost about a quarter of their value this year, rose as much as 9 percent to $30.63. They were the top percentage gainer on the New York Stock Exchange on Tuesday morning.
The company said it now expects adjusted earnings from continuing operations to be between $2.86 and $3.05 per share for fiscal 2012, up from its earlier forecast of between $2.80 and $2.95 per share.
"During the peak of traffic in the last week of November, we were encouraged by performance of some of our most important holiday categories," Chief Executive Steven Fishman said on a conference call with analysts.
The company, which stocks products that have been overproduced, discontinued, or rejected by other retailers, has been expanding its consumables, home and furniture segments.
Off-price stores such as Big Lots generally do well when economic concerns such as high unemployment and rising food prices push those on limited budgets to cut spending.
Big Lots, which hired John Martin as chief merchandising officer in September, said it will try to consistently bring in branded products next year.
It has been trying to drive traffic by testing new products including coolers and freezers as well as remodeling its stores.
CEO Fishman, who has been with Big Lots for seven years, will retire in 2013, the company said. He will be with the retailer until his replacement is found.
"Throughout the third quarter, the team worked diligently to keep costs lean in the areas of distribution, transportation, advertising, store payroll, recognizing that sales were going to be challenging," said Chief Financial Officer Timothy Johnson.
Loss from continuing operations in the quarter ended October 27 was $6 million, or 10 cents per share. Analysts on average expected a loss of 24 cents per share, according to Thomson Reuters I/B/E/S.
(Reporting by Arpita Mukherjee in Bangalore; Editing by Joyjeet Das)