Big Lots, Inc. · OTC:BIGGQ
Big Lots — Q3 2021 Earnings Presentation
23 slides from Big Lots's earnings presentation, Dec 6, 2021
Slide 1: Third Quarter 2021 Results Investor Presentation
Q3 | 2021 | 1 THIRD QUARTER 2021 RESULTS Investor Presentation
Slide 2: Forward Looking Statements
Q3 | 2021 | 2 FORWARD LOOKING STATEMENTS Certain statements in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and such statements are intended to qualify for the protection of the safe harbor provided by the Act. The words “ant
Slide 3: CEO Comment
Q3 | 2021 | 3 CEO COMMENT We are pleased to have delivered the quarter in line with our guidance, and to have sustained double-digit two-year comps despite supply chain challenges and the expiration of stimulus benefits. Our absolute focus coming into Q4 has been to position ourselves appropriately
Slide 4: At a Glance
Q3 | 2021 | 4 AT A GLANCE $6.2 BILLION Trailing 12- month sales 1,428 Stores across 47 states 22.1 MILLION Rewards members Ranked 449th in the Fortune 500 in 2020 ~22,800 selling sq ft per store 10% CAGR over last 5 years >5% eComm penetration
Slide 5: Our Mission, Vision and Values
Q3 | 2021 | 5 OUR MISSION We help people live BIG and save LOTS OUR VISION Be the BIG difference for a better life by… OUR VALUES We are customer obsessed! We play to win! We are courageous! We treat all with respect! We are one team! …delivering unmatched value and surprising products
Slide 6: Third Quarter 2021 Highlights
Q3 | 2021 | 6 12.3% 2-Year Comp 38.9% Gross Margin Rate ($0.14) Loss per share 17.3% Increase in ending inventory Down 4.7% to 2020 Middle of guidance range Well positioned to meet Q4 demand THIRD QUARTER 2021 HIGHLIGHTS Slightly favorable to guidance
Slide 7: Q3 2021 Sales Composition
Q3 | 2021 | 7 Q3 2021 SALES COMPOSITION 30% 15% 14% 12% 11% 9% 9% Furniture Soft Home Food Consumables Hard Home Other* Seasonal Well Balanced Category Mix 52% 31% 13% 12% 10% 4% -6% 12% Double Digit 2-Year Comp Sales Growth Across Most Categories 2021 vs 2019 Comp sales = (1 + TY Comp) * (1 + LY co
Slide 8: Summary Income Statement – Q3
Q3 | 2021 | 8 Net Sales Gross Margin Gross Margin Rate Adjusted Operating Expenses(1)(2) Adjusted Operating Expense Rate(2) Adjusted Operating Profit (Loss)(2) Adjusted Operating Profit (Loss) Rate(2) Adjusted Diluted Earnings (Loss) Per Share(2) Diluted Weighted Average Shares SUMMARY INCOME STATEM
Slide 9: Summary Income Statement – Year-to-Date
Q3 | 2021 | 9 Net Sales Adjusted Gross Margin(2) Adjusted Gross Margin Rate(2) Adjusted Operating Expenses(1)(2) Adjusted Operating Expense Rate(2) Adjusted Operating Profit(2) Adjusted Operating Profit Rate(2) Adjusted Diluted Earnings Per Share(2) Diluted Weighted Average Shares SUMMARY INCOME STA
Slide 10: Capital Allocation
Q3 | 2021 | 10 CAPITAL ALLOCATION 2021 projected capital expenditures $170-$180 MILLION $0.30 QUARTERLY DIVIDEND* 9.3 MILLION $71 MILLION ONGOING FOCUS ON CAPITAL RETURN WHILE INVESTING IN HIGH GROWTH STRATEGIES * The payment of future dividends will be at the discretion of our Board of Directors an
Slide 11: Operation North Star
Q3 | 2021 | 11 OPERATION NORTH STAR FUND ENABLE GROW Merchandise productivity Store count growth eCommerce acceleration Brand activation and customer growth Pricing and COGS program Promos and markdowns Shrink and loss reduction Structural expense reduction and leverage Supply chai
Slide 12: Merchandise Productivity
Q3 | 2021 | 12 MERCHANDISE PRODUCTIVITY Rolling out Next Generation Furniture Sales team to 500+ stores Growing Furniture with Broyhill, more modern assortments, and expanding DC network to support bulk product Winning Seasonal throughout the year with increased newness and inventory investmen
Slide 13: Growing Store Count
Q3 | 2021 | 13 GROWING STORE COUNT Adding 50+ net new stores in 2022 with the rate of openings accelerating after 2022. New stores driving at least $120 million of sales in 2022 Delivering four-wall EBITDA margins of 10% or greater Store intervention program successfully reducing closures
Slide 14: Increasing eComm Conversion
Q3 | 2021 | 14 Increasing conversion through an enhanced user experience (enhanced search, easy checkout) Enhancing inventory visibility and access Accelerating Supplier Direct Fulfillment & extending our aisle Growing site traffic through targeted marketing and increased national presence
Slide 15: Investing in Our Supply Chain
Q3 | 2021 | 15 INVESTING IN OUR SUPPLY CHAIN Launching two incremental FDCs, in addition to the two added in 2021 – relieving pressure on Regional DCs and enhancing our ability to process bulk product Opening “pop-up” bypass DCs to assist Regional DCs in handling seasonal receipts Launching Cen
Slide 16: Investing in Our Customer Experience
Q3 | 2021 | 16 INVESTING IN OUR CUSTOMER EXPERIENCE Updating 800 stores through Project Refresh to deliver a consistent and upgraded brand experience across our chain Upgrading signage, vestibules, flooring, wall graphics, painting, remodeling bathrooms Costing slightly more than $100,000 per
Slide 17: Activating Our Brand
Q3 | 2021 | 17 Continuing the breakthrough “Be A BIGionaire” ad campaign featuring new celebrity BIGionaires, starting with Retta (Parks & Recreation) and adding Eric Stonestreet (Modern Family) and Molly Shannon (Saturday Night Live) this holiday Creating a community of bargain hunters and trea
Slide 18: Q4 2021 Outlook
Q3 | 2021 | 18 Q4 2021 OUTLOOK EARNINGS PER DILUTED SHARE $2.05-$2.20(1) COMP SALES GROSS MARGIN NEW STORE SALES SG&A Slightly positive comparable sales increase to 2020, and up high single digits to 2019 150 basis point decline compared to 2020 driven by freight headwinds Expense dollars up by mid-
Slide 19: Full Year Fiscal 2021 Outlook
Q3 | 2021 | 19 FULL YEAR FISCAL 2021 OUTLOOK EARNINGS PER DILUTED SHARE $5.70-$5.85(1) GROSS MARGIN COMP SALES SG&A Inventory Low-single-digit comparable sales decline vs. 2020, but up double-digits on a two-year basis Up approximately 20% to 2019, well positioned to support Spring sales 120 basis p
Slide 20: Appendix
Q3 | 2021 | 20 APPENDIX
Slide 21: Q3 2019 GAAP to Non-GAAP Reconciliation
Q3 | 2021 | 21 Q3 2019 GAAP TO NON-GAAP RECONCILIATION The above adjusted selling and administrative expenses, adjusted operating profit, adjusted operating profit rate, adjusted income tax expense, adjusted effective income tax rate, adjusted net income, and adjusted diluted earnings per share are
Slide 22: YTD 2020 GAAP to Non-GAAP Reconciliation
Q3 | 2021 | 22 YTD 2020 GAAP TO NON-GAAP RECONCILIATION The above adjusted selling and administrative expenses, adjusted gain on sale of distribution centers, adjusted operating profit rate, adjusted income tax expense, adjusted effective income tax rate, adjusted net income, and adjusted diluted ea
Slide 23: GAAP to Non-GAAP Reconciliation
Q3 | 2021 | 23 The above adjusted gross margin, adjusted gross margin rate, adjusted selling and administrative expenses, adjusted gain on sale of distribution center, adjusted operating profit, adjusted operating profit rate, adjusted income tax expense, adjusted effective income tax rate, adjusted