Ollie’s Buying Up Big Lots Leases; New CEO to Take Reins in February
Ollie’s Bargain Outlet reported a 7.8% increase in revenue for its third quarter as it continues to expand its store count — with the help of former Big Lots locations.
To date, the close-out retailer, which opened a record 24 stores during the quarter, has acquired 17 store locations in connection with Big Lots’ bankruptcy proceedings, with 15 acquired in the third quarter and two acquired after it ended. Earlier this month, Ollie’s was the winning bidder in a bankruptcy sale to acquire an additional seven former Big Lots store leases.
In a statement, CEO said John Swygert noted that, during the quarter, the chain took advantage of a number of real estate opportunities “that strengthened our new store pipeline and enhanced our competitive positioning for the future.”
In June, Ollie’s announced that Swygert would transition to the role of executive chairman in early 2025, at which time (the beginning of fiscal 2025) Eric van der Valk would take the reins as CEO. Van der Valk joined Ollie’s in 2021 as EVP and COO and was promoted to president in June. Prior to joining Ollie’s, he served as president and COO of Christmas Tree Shops.
“The transition of the CEO role and responsibilities is progressing as planned,” said Swygert. “I have had an amazing 20 plus year career at Ollie’s and would like to thank each and every team member that has been part of our family. While proud of what we have accomplished, I am even more excited about our growth potential and positioning going forward. Our value proposition is clear, our deal flow is strong, and our ability to execute is as good as it’s ever been.”
Net income rose 8% to $35.9 million, or $0.58 per share, for the quarter ended Nov. 2, compared with net income of $31.8 million, or $0.51 per share in the year-ago quarter. Analysts had expected earnings per share of $0.57. Operating income rose 14.0% to $44.5 million.
Net sales rose 7.8% to of $517.8 million due partly to its increase in stores, but missing estimates of $518.8 million. Comp sales fell 0.5%.
"We had another great quarter and are pleased with our results," said Swygert. "We delivered strong earnings on higher sales, gross margin, and disciplined expense control. We also took advantage of a number of real estate opportunities that strengthened our new store pipeline and enhanced our competitive positioning for the future."
The company opened 24 new stores and closed three stores, including two permanent closures and one temporary closure related to Hurricane Helene, during the quarter, for a total of 546 stores in 31 states.
This article was originally reported by sister publication Chains Store Age.
