Big Lots Q3 Results Top Street View; Cuts FY21 EPS Outlook

Big Lots Inc BIG reported a third-quarter FY21 sales decline of 3.1% year-on-year and increased 14.4% from Q3 FY19 to $1.34 billion, beating the analyst consensus of $1.32 billion.

• Comparable sales decreased 4.7% versus a 17.8% increase last year. On a two-year basis, comparable sales increased 12.3%. 
• EPS loss of $(0.14) beat the analyst consensus of $(0.16).
• The gross margin for the quarter decreased 160 basis points Y/Y to 38.9%. The company reported an operating loss of $(4.1) million for the quarter.
• The company held $70.6 million in cash and equivalents as of October 30, 2021. Cash provided by operating activities for nine months ended October 30, 2021, totaled $75.7 million.
• The company's Board of Directors authorized a new repurchase of up to $250 million of outstanding common shares.
• The company's quarterly cash dividend of $0.30 per common share will be payable on December 29, 2021, to shareholders of record on December 15, 2021.
• Outlook: Big Lots sees Q4 EPS of $2.05 - $2.20, below the consensus of $2.39. The company expects Q4 gross margin to be down approximately 150 basis points to last year, driven by freight headwinds.
• The company cut FY21 EPS guidance to $5.70 - $5.85 (prior view $5.90 - $6.05), missing the consensus of $5.97.
• Big Lots expects supply chain challenges to continue in the near term.
• Meanwhile, the company expects to see gross margin expansion in 2022.
• Price Action: BIG shares are trading lower by 1.44% at $42.99 in premarket on the last check Friday.