Big Lots Faces Challenges, Reaches Out For New Loan

Big Lots Inc BIG secured a $200 million loan earlier this year; now, it’s reaching out to potential investors to explore interest in a new loan backed by assets like the company’s leases.

The discount home goods chain, which operates nearly 1,400 stores, has faced years of declining same-store sales, reported Bloomberg.

To combat these challenges, Big Lots has shifted its focus back to extreme bargains and closeout sales after a strategic pivot to furniture sales faltered due to a decline in new home sales and renovations.

For the quarter ending May 4, Big Lots reported a 10.2% drop in net sales to approximately $1.01 billion compared to the previous year.

CEO Bruce Thorn attributed the downturn to a “challenging consumer environment” and “strained budgets” during the company’s first-quarter earnings call. The retailer posted a net loss of $205 million for the period.

In addition to returning to its roots in bargain sales, Big Lots is considering sub-leasing some of its locations to generate more revenue.

Columbus, Ohio-based Big Lots is not alone in facing difficulties within the retail sector due to a slowdown in home spending.

Conn’s Inc.CONN, another furniture retailer, recently filed for bankruptcy, while LL Flooring Holdings Inc. is contemplating a Chapter 11 filing.

Price Action: BIG shares are trading higher by 1.83% at $1.11 in premarket at last check Friday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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