posted a second-quarter loss on Wednesday, reversing a profit in the year-ago period, but said that sales rose 8% from the 2002 period.
The retailer lost $8 million, or 7 cents share, in the second quarter, compared with net income of $3.2 million, or 3 cents a share, in the same quarter last year. Excluding a one-time charge of $6.4 million related to settling lawsuits, Big Lots lost $1.6 million, or 1 cent a share.
Wall Street expected the company to earn 3 cents a share, according to consensus estimates from a Thomson First Call poll.
Quarterly net sales came in at $949.3 million, up from last year's $879.3 million, but the company's gross margin fell 60 basis points to 41.3%. Michael Potter, the chairman and chief executive, blamed the decline on promotional markdowns of spring decorative merchandise.
"Expenses continue to be on plan and well managed," Potter said in a prepared statement. "The second half of 2003 guidance calls for favorable expense leverage as the level of investment spending compared to last year slows and the expected sales benefit builds."
Big Lots said it will post anywhere from a loss of 3 cents a share to a profit of 1 cent a share in the third quarter, and earn between 64 cents and 69 cents a share in the fourth quarter.
"We are encouraged by sales trends as we begin the third quarter," said Potter. "The compounding nature of our business initiatives, our strong branded offering in need-based consumables, and the shift in our seasonal assortment toward more basic items leaves us well positioned to drive meaningful sales and earnings improvement in the second half of this year."
Shares of Big Lots were recently up 60 cents, or 3.5%, to $17.60.