big-20221029

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 29, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number 001-08897

BIG LOTS, INC.

(Exact name of registrant as specified in its charter)

Ohio 06-1119097

(State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.)

4900 E. Dublin-Granville Road, Columbus, Ohio 43081

(Address of Principal Executive Offices) (Zip Code)

(614) 278-6800

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common shares	BIG	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesþ Noo

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yesþ Noo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ

Accelerated filer o

Non-accelerated filer o

Smaller reporting company o

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

The number of the registrant’s common shares, $0.01 par value, outstanding as of December 2, 2022, was 28,958,865.

Table of Contents

BIG LOTS, INC.

FORM 10-Q

FOR THE FISCAL QUARTER ENDED OCTOBER 29, 2022

TABLE OF CONTENTS


		Page
Part I. Financial Information		2

Item 1.	Financial Statements	2

a)	Consolidated Statements of Operations and Comprehensive Income for the Thirteen and Thirty-nine Weeks Ended October 29 , 2022 (Unaudited) and October 3 0 , 2021 (Unaudited)	2

b)	Consolidated Balance Sheets at October 29 , 2022 (Unaudited) and January 29, 2022 (Unaudited)	3

c)	Consolidated Statements of Shareholders’ Equity for the Thirteen and Thirty-nine Weeks Ended October 29 , 2022 (Unaudited) and October 30 , 2021 (Unaudited)	4

d)	Consolidated Statements of Cash Flows for the Thirty-nine Weeks Ended October 29 , 2022 (Unaudited) and October 3 0 , 2021 (Unaudited)	5

e)	Notes to Consolidated Financial Statements (Unaudited)	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24

Item 4.	Controls and Procedures	25

Part II. Other Information		25

Item 1.	Legal Proceedings	25

Item 1A.	Risk Factors	25

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26

Item 3.	Defaults Upon Senior Securities	27

Item 4.	Mine Safety Disclosures	27

Item 5.	Other Information	27

Item 6.	Exhibits	27

Signature		28

Table of Contents

Part I. Financial Information

Item 1. Financial Statements


BIG LOTS, INC. AND SUBSIDIARIES Consolidated Statements of Operations and Comprehensive Income (Unaudited) (In thousands, except per share amounts)


	Thirteen Weeks Ended				Thirty-nine Weeks Ended
	October 29, 2022		October 30, 2021		October 29, 2022		October 30, 2021
Net sales	$	1,204,281	$	1,335,656	$	3,925,216	$	4,418,582
Cost of sales (exclusive of depreciation expense shown separately below)	794,821		816,475		2,572,614		2,667,657
Gross margin	409,460		519,181		1,352,602		1,750,925
Selling and administrative expenses	503,016		487,378		1,494,239		1,473,454
Depreciation expense	37,255		35,930		111,808		105,196
Operating (loss) profit	(130,811)		(4,127)		(253,445)		172,275
Interest expense	(6,256)		(2,284)		(12,910)		(7,148)
Other income (expense)	62		285		1,359		1,112
(Loss) income before income taxes	(137,005)		(6,126)		(264,996)		166,239
Income tax (benefit) expense	(33,992)		(1,796)		(66,751)		38,299
Net (loss) income and comprehensive (loss) income	$	(103,013)	$	(4,330)	$	(198,245)	$	127,940

Earnings (loss) per common share
Basic	$	(3.56)	$	(0.14)	$	(6.88)	$	3.80
Diluted	$	(3.56)	$	(0.14)	$	(6.88)	$	3.73

Weighted-average common shares outstanding
Basic	28,943		31,679		28,828		33,677
Dilutive effect of share-based awards	—		—		—		617
Diluted	28,943		31,679		28,828		34,294

Cash dividends declared per common share	$	0.30	$	0.30	$	0.90	$	0.90

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents


BIG LOTS, INC. AND SUBSIDIARIES Consolidated Balance Sheets (Unaudited) (In thousands, except par value)


	October 29, 2022		January 29, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	62,138	$	53,722
Inventories	1,345,280		1,237,797
Other current assets	122,581		119,449
Total current assets	1,529,999		1,410,968
Operating lease right-of-use assets	1,693,138		1,731,995
Property and equipment - net	718,642		735,826
Deferred income taxes	53,962		10,973
Other assets	39,671		37,491
Total assets	$	4,035,412	$	3,927,253

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	481,779	$	587,496
Current operating lease liabilities	245,768		242,275
Property, payroll, and other taxes	101,597		90,728
Accrued operating expenses	125,518		120,684
Insurance reserves	39,335		36,748
Accrued salaries and wages	27,700		45,762
Income taxes payable	1,225		894
Total current liabilities	1,022,922		1,124,587
Long-term debt	459,900		3,500
Noncurrent operating lease liabilities	1,575,678		1,569,713
Deferred income taxes	—		21,413
Insurance reserves	60,269		62,591
Unrecognized tax benefits	8,170		10,557
Other liabilities	126,243		127,529
Shareholders’ equity:
Preferred shares - authorized 2,000 shares; $0.01 par value; none issued	—		—
Common shares - authorized 298,000 shares; $0.01 par value; issued 117,495 shares; outstanding 28,949 shares and 28,476 shares, respectively	1,175		1,175
Treasury shares - 88,546 shares and 89,019 shares, respectively, at cost	(3,105,617)		(3,121,602)
Additional paid-in capital	624,894		640,522
Retained earnings	3,261,778		3,487,268
Total shareholders’ equity	782,230		1,007,363
Total liabilities and shareholders’ equity	$	4,035,412	$	3,927,253

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents


BIG LOTS, INC. AND SUBSIDIARIES Consolidated Statements of Shareholders’ Equity (Unaudited) (In thousands)


	Common			Treasury			Additional Paid-In Capital		Retained Earnings
	Shares	Amount		Shares	Amount						Total
Thirteen Weeks Ended October 30, 2021
Balance - July 31, 2021	32,550	$	1,175	84,945	$	(2,934,912)	$	625,651	$	3,461,455	$	1,153,369
Comprehensive loss	—	—		—	—		—		(4,330)		(4,330)
Dividends declared ($0.30 per share)	—	—		—	—		—		(10,209)		(10,209)
Purchases of common shares	(2,059)	—		2,059	(97,690)		—		—		(97,690)
Restricted shares vested	43	—		(43)	1,518		(1,518)		—		—
Performance shares vested	—	—		—	—		—		—		—
Other	1	—		(1)	—		(1)		—		(1)
Share-based employee compensation expense	—	—		—	—		8,701		—		8,701
Balance - October 30, 2021	30,535	$	1,175	86,960	$	(3,031,084)	$	632,833	$	3,446,916	$	1,049,840

Thirty-nine Weeks Ended October 30, 2021
Balance - January 30, 2021	35,535	$	1,175	81,960	$	(2,709,259)	$	634,813	$	3,351,002	$	1,277,731
Comprehensive income	—	—		—	—		—		127,940		127,940
Dividends declared ($0.90 per share)	—	—		—	—		—		(32,026)		(32,026)
Purchases of common shares	(6,008)	—		6,008	(355,508)		—		—		(355,508)
Restricted shares vested	471	—		(471)	15,778		(15,778)		—		—
Performance shares vested	536	—		(536)	17,879		(17,879)		—		—
Other	1	—		(1)	26		32		—		58
Share-based employee compensation expense	—	—		—	—		31,645		—		31,645
Balance - October 30, 2021	30,535	$	1,175	86,960	$	(3,031,084)	$	632,833	$	3,446,916	$	1,049,840

Thirteen Weeks Ended October 29, 2022
Balance - July 30, 2022	28,932	$	1,175	88,563	$	(3,106,360)	$	621,925	$	3,373,987	$	890,727
Comprehensive loss	—	—		—	—		—		(103,013)		(103,013)
Dividends declared ($0.30 per share)	—	—		—	—		—		(9,196)		(9,196)
Purchases of common shares	(9)	—		9	(190)		—		—		(190)
Restricted shares vested	20	—		(20)	718		(718)		—		—
Performance shares vested	6	—		(6)	215		(215)		—		—

Share-based employee compensation expense	—	—		—	—		3,902		—		3,902
Balance - October 29, 2022	28,949	$	1,175	88,546	$	(3,105,617)	$	624,894	$	3,261,778	$	782,230

Thirty-nine Weeks Ended October 29, 2022
Balance - January 29, 2022	28,476	$	1,175	89,019	$	(3,121,602)	$	640,522	$	3,487,268	$	1,007,363
Comprehensive loss	—	—		—	—

SEC Form 10-Q filed by Big Lots Inc.