[Update as of Aug. 6, 2024] In a 8-K form filed with the Securities and Exchange Commission (SEC) on Aug. 2, 2024, Big Lots revealed that it now would be permitted to close as many as 315 stores as part of efforts to right its financial ship. The retailer’s original agreement with lenders cited a cap of 150 store closures. The retailer also was able to reduce its aggregate commitments from $900 million to $800 million, although with a 0.5% increase in the interest rate for borrowings from its 2022 Credit Agreement.
While Big Lots may not have to close all 315 locations, the retailer already has posted closing notices on the websites for 279 of its stores across the country. California will be the hardest hit, with 75 locations scheduled to close, followed by Florida with 26 and Arizona and Washington with 18 each.
Original story from July 9, 2024 begins-
Big Lots will close 35 to 40 stores in 2024 following a tough Q1, and in a recent SEC 10-Q filing the retailer expressed “substantial doubt about the Company’s ability to continue as a going concern.” The retailer boosted its liquidity with a $200 million term loan facility in April 2024 but is now forecasting difficulty paying that loan back within the next 12 months, increasing the risk of a default.
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For Q1 2024, which ended May 4, 2024, Big Lots had a 9.9% decrease in comp sales compared to the same period in 2023. Net sales fell 10.2% in Q1 2024 compared to Q1 2023, dropping from $1.12 billion to $1 billion. The retailer operates nearly 1,400 stores in 48 states, with key product categories including furniture and home goods, food and seasonal items.
Big Lots’ management has “implemented plans to reduce costs, improve sales and enhance its financial flexibility and liquidity,” according to the SEC filing, but it’s uncertain whether these actions will be enough to right the retailer’s course.
