COLUMBUS, Ohio — Big Lots Inc. has shaken up its executive ranks after reporting disappointing quarterly results and lowering its full-year earnings guidance for the second time.
Big Lots Inc. has shaken up its executive ranks after reporting disappointing quarterly results and lowering its full-year earnings guidance for the second time.
The closeout chain reported a 38.1% drop in income from continuing operations to $22.1 million, or 36 cents per diluted share, for the second quarter. Analysts surveyed by Thomson Reuters had expected 41 cents per diluted share, on average. Sales, meanwhile, rose 4% to $1.22 billion, short of the $1.24 billion projected by analysts.
As a result of the performance, management lowered its full-year adjusted profit projection to a range of $2.80 to $2.95 per share, down from a prior forecast of $3.25 to $3.40 per share. Analysts had been looking for $3.29 per share, on average.
During a conference call with analysts, chairman, president and chief executive officer Steve Fishman explained that the chain’s discretionary business, which encompasses furniture, home and seasonal, softened in the second quarter. He added that management expects some of those categories to remain challenged in the near term.
"Our business needs to be constantly evolving," he said. "I’ve said this on many occasions: Our model is different. When we’re not changing in merchandising and driving it all the way to the store and, ultimately, the customer, we fall behind."
Against that background, the company’s executive vice president of merchandising, Douglas Wurl, has resigned. Succeeding him is John Martin, who has been promoted to executive vice president and chief merchandising officer, with responsibility not only for merchandising but for global sourcing and marketing as well. Martin originally joined Big Lots in 2003 as executive vice president of merchandising but in April 2011 took the position of executive VP of administration.
In addition, Lisa Bachmann has been elevated to executive vice president and chief operating officer. While taking on responsibility for store operations, she retains oversight of merchandise planning and allocation, information technology, and distribution and transportation services as well. Moreover, she continues to serve as the company’s chief information officer.
In other moves, Charles Haubiel II has been promoted to chief administrative officer. In his new role, Haubiel will lead the human resources and loss prevention departments while retaining responsibility for the legal and real estate departments and continuing to serve as general counsel and corporate secretary. He was promoted to executive VP in 2010.
Reporting to Haubiel is Michael Schlonsky, who has been elevated to the position of senior VP of human resources. He had been vice president of associate relations and benefits.
Finally, Timothy Johnson has been promoted to senior VP and chief financial officer, following promotion to the position of senior VP of finance in July 2011. Martin, Bachmann, Haubiel and Johnson all report to Fishman.
Fishman told analysts that, in addition to the executive changes, the chain will initiate several in-store tests, including installation of coolers and freezers, acceptance of food stamps, a new loyalty program, and full store remodels intended to provide a “like new” in-store experience.
