Big Lots blames weak first quarter on weather

Big Lots is blaming lousy spring weather for its first-quarter profit coming up short of Wall Street estimates.

On Friday, the retailer reported a profit of $31.2 million, or 74 cents per share, in the period that ended May 5. Analysts were looking for a profit of $1.20 per share.

Comparable-store sales, a key indicator of a retailer’s strength, fell 3 percent in the quarter; Big Lots had forecast they would be flat to slightly down.

Total sales fell slightly, to $1.3 billion, in the quarter, hurt by not only the decline in comparable-store sales but also a decrease in the number of stores.

The results pushed Big Lots shares down about 10 percent in early trading Friday to a two-year low, but the shares rallied some, closing at $38.69, down $2.20, or 5.4 percent.

The company said the quarter got off to a slow start because of intense competition over the Presidents Day sales period and soft furniture sales.

“Sales trends did improve from February to March to April, but the rate of improvement was damaged by cool, wet weather and did not make up for the slow start to the quarter,” Executive Vice President Lisa Bachmann told analysts on a conference call.

She said that when sales are down in categories such as lawn and garden, it has “an unfavorable halo effect on other categories in the store as well. We are pleased to report that sales trends have improved in May, now that warm weather has finally arrived.”

The results included after-tax expenses of $8.7 million, or 21 cents per share, associated with the recent settlement of a lawsuit and the retirement of CEO David Campisi.

Last month, the company agreed to pay $38 million to settle insider-trading claims that dated to 2012; some current and former executives were accused of misleading investors about the company’s performance.

Campisi, meanwhile, retired in April after being on medical leave since December.