Big Lots' new furniture focus boosts sales
Big Lots on Friday said second quarter net sales reached $1.22 billion, up slightly from $1.219 billion for the same period last year and just missing the FactSet consensus for $1.23 billion cited by MarketWatch. Net income in the quarter fell to $24.2 million from last year's $29.1 million, the company said in a press release.
Comparable store sales rose 1.6%, besting FactSet's consensus forecast for a 1% rise. For the year, the discount retailer said it expects comps to rise 1%, which would beat the FactSet's expectation of 0.4%.
Earlier in the week, the company announced that Bruce Thorn will become CEO and president at the end of September. Thorn was most recently the president and chief operating officer of Tailored Brands, according to a company press release.
Big Lots is in the midst of a branding pivot to focus more on furniture sales, a segment with a lot of opportunity as consumers continue to invest in their homes. But the space has become increasingly competitive.
In February, Big Lots tapped Stephen Haffer, previously a longtime executive at furniture retail company American Signature, as senior vice president and chief customer officer, a nod to its new focus. In a conference call Friday, executives told analysts that the move has paid off, with good response to its new furniture offering across the board but especially strong in sectionals and fireplaces. Mattresses — a segment experiencing a lot of turmoil as pure-play disrupters partner with legacy retailers and open their own stores — are also selling well at Big Lots.
In the quarter, the company shuttered four stores and also opened four, maintaining its base of 1,416 stores, down from more than 1,500 five years ago. The company is also testing a new "store of the future" concept.
Executives said the company has shifted its marketing play to go beyond its current reliance on email to find customers through social media and ads through sites like Pandora.
Thorn will arrive as the company continues to push furniture sales ahead of and into the holiday period. Before his tenure at Tailored Brands, he held various enterprise-level roles at PetSmart since 2007, most recently as executive vice president of store operations, services and supply chain. He also held leadership positions at Gap, Inc., Cintas, LESCO and in the U.S. Army.
In April, CEO David Campisi stepped down president, CEO and a member of its board of directors, after five years at the helm. He had been on a leave of absence for medical reasons since December, and retired to focus fully on his health and on community service, the company said.
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