Big Lots (NYSE:BIG) shares rose more than 14% in premarket trading Tuesday after the furniture and home decor retailer reported better-than-feared Q2 results.
Big Lots said its comparable sales declined by 14.6% compared to the same period last year, which is better than the estimated decline of 18.1%.
Adjusted loss per share was $3.24, compared to a loss of $2.28 per share in the same quarter last year. The estimated loss per share was $4.11.
Commenting on today’s results announcement, Bruce Thorn, president and CEO of Big Lots stated, “Our results for Q2 illustrate that we remain in a very challenging environment, in which our core lower-income customer remains under significant pressure and has limited capacity for higher-ticket discretionary purchases.’
“However, we did see some sequential improvement in the quarter, and were pleased to come in ahead of or in line with our guidance on all key metrics. We believe this improvement was driven by the five key actions we have taken, which are to own bargains, communicate unmistakable value, increase store relevance, win with omnichannel, and drive productivity.”
Net sales amounted to $1.14 billion, representing a 15% year-on-year decrease. The estimated net sales were $1.1B.
Gross margin stood at 33%, slightly higher than the 32.6% recorded in the same quarter last year, but lower than the consensus for gross margin of 33.2%. Inventory fell 15% YoY to $983.2 million.
For the third quarter, the company expects comparable sales to be down in the low-teen range, modestly improved relative to the second quarter.
For the fourth quarter, Big Lots expects comparable sales to be improved relative to the third quarter and be in the high-single-digit negative range “as key actions to improve the business continue to gain traction.”