big-20211030

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 30, 2021

☐ 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 3, 2021, was 30,540,270.

Table of Contents

BIG LOTS, INC.

FORM 10-Q

FOR THE FISCAL QUARTER ENDED OCTOBER 30, 2021

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 30, 2021 (Unaudited) and October 31 , 2020 (Unaudited)	2

b)	Consolidated Balance Sheets at October 30 , 2021 (Unaudited) and January 30, 2021 (Unaudited)	3

c)	Consolidated Statements of Shareholders’ Equity for the Thirteen and Thirty-Nine Weeks Ended October 30 , 2021 (Unaudited) and October 31 , 2020 (Unaudited)	4

d)	Consolidated Statements of Cash Flows for the Thirty-Nine Weeks Ended October 30 , 2021 (Unaudited) and October 31 , 2020 (Unaudited)	5

e)	Notes to Consolidated Financial Statements (Unaudited)	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24

Item 4.	Controls and Procedures	24

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	25

Item 3.	Defaults Upon Senior Securities	25

Item 4.	Mine Safety Disclosures	25

Item 5.	Other Information	26

Item 6.	Exhibits	26

Signature		26

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 30, 2021		October 31, 2020		October 30, 2021		October 31, 2020
Net sales	$	1,335,656	$	1,377,925	$	4,418,582	$	4,461,271
Cost of sales (exclusive of depreciation expense shown separately below)	816,475		820,032		2,667,657		2,649,058
Gross margin	519,181		557,893		1,750,925		1,812,213
Selling and administrative expenses	487,378		482,307		1,473,454		1,444,938
Depreciation expense	35,930		33,086		105,196		104,750
Gain on sale of distribution centers	—		—		—		(463,053)
Operating (loss) profit	(4,127)		42,500		172,275		725,578
Interest expense	(2,284)		(2,586)		(7,148)		(8,456)
Other income (expense)	285		(484)		1,112		(2,444)
(Loss) income before income taxes	(6,126)		39,430		166,239		714,678
Income tax (benefit) expense	(1,796)		9,520		38,299		183,473
Net (loss) income and comprehensive (loss) income	$	(4,330)	$	29,910	$	127,940	$	531,205

Earnings (loss) per common share
Basic	$	(0.14)	$	0.79	$	3.80	$	13.69
Diluted	$	(0.14)	$	0.76	$	3.73	$	13.46

Weighted-average common shares outstanding
Basic	31,679		38,054		33,677		38,807
Dilutive effect of share-based awards	—		1,137		617		659
Diluted	31,679		39,191		34,294		39,466

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 30, 2021		January 30, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	70,596	$	559,556
Inventories	1,277,225		940,294
Other current assets	148,959		85,939
Total current assets	1,496,780		1,585,789
Operating lease right-of-use assets	1,745,291		1,649,009
Property and equipment - net	738,673		717,216
Deferred income taxes	16,055		16,329
Other assets	35,524		68,914
Total assets	$	4,032,323	$	4,037,257

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	605,336	$	398,433
Current operating lease liabilities	235,473		226,075
Property, payroll, and other taxes	104,806		109,694
Accrued operating expenses	123,304		138,331
Insurance reserves	35,616		34,660
Accrued salaries and wages	74,648		49,830
Income taxes payable	508		43,601
Total current liabilities	1,179,691		1,000,624
Long-term debt	—		35,764
Noncurrent operating lease liabilities	1,579,209		1,465,433
Deferred income taxes	8,504		7,762
Insurance reserves	58,330		57,452
Unrecognized tax benefits	10,415		11,304
Other liabilities	146,334		181,187
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 30,535 shares and 35,535 shares, respectively	1,175		1,175
Treasury shares - 86,960 shares and 81,960 shares, respectively, at cost	(3,031,084)		(2,709,259)
Additional paid-in capital	632,833		634,813
Retained earnings	3,446,916		3,351,002
Total shareholders’ equity	1,049,840		1,277,731
Total liabilities and shareholders’ equity	$	4,032,323	$	4,037,257

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 31, 2020
Balance - August 1, 2020	39,251	$	1,175	78,244	$	(2,537,359)	$	617,496	$	3,246,848	$	1,328,160
Comprehensive income	—	—		—	—		—		29,910		29,910
Dividends declared ($0.30 per share)	—	—		—	—		—		(11,993)		(11,993)
Purchases of common shares	(2,197)	—		2,197	(100,690)		—		—		(100,690)
Exercise of stock options	—	—		—	10		—		—		10
Restricted shares vested	34	—		(34)	1,102		(1,102)		—		—
Performance shares vested	—	—		—	—		—		—		—
Other	—	—		—	(2)		1		—		(1)
Share-based employee compensation expense	—	—		—	—		10,906		—		10,906
Balance - October 31, 2020	37,088	$	1,175	80,407	$	(2,636,939)	$	627,301	$	3,264,765	$	1,256,302

Thirty-Nine Weeks Ended October 31, 2020
Balance - February 1, 2020	39,037	$	1,175	78,458	$	(2,546,232)	$	620,728	$	2,769,793	$	845,464
Comprehensive income	—	—		—	—		—		531,205		531,205
Dividends declared ($0.90 per share)	—	—		—	—		—		(36,233)		(36,233)
Purchases of common shares	(2,316)	—		2,316	(

SEC Form 10-Q filed by Big Lots, Inc.