In fact, predicted Steve Fishman, chairman and CEO, the total store count likely will contract in coming years, due to an overvalued real estate market. Instead, the company will wait for the market to soften.
"Right now, real estate is not a value," Fishman said. "We could open a significant number of stores from our cash position, but we will not overpay for real estate."
The company has budgeted $15 million to $20 million for new store openings in 2007, which could translate to 15 new stores or slightly fewer. Real estate strategy is prioritized to expanding in strong markets.
"We want to open new stores, but we will not overpay for real estate just for unit growth," Fishman said.
The company opened 11 new stores and closed 137 units in 2006.
Comp-store sales increases will be driven by marketing and merchandising, including a greater emphasis on certain categories such as electronics and seasonal items, he said.
Net sales for the 14-week fourth quarter rose 10.8% to $1,545.4 million. Net income was $104.3 million, compared to net income of $14.7 million for the same period of fiscal 2005. Comparable-store sales for stores open at least two years at the beginning of the fiscal year increased 4.9% for the quarter.
The company did not reveal final sales results for the 53-week fiscal year ended Feb. 3, 2007. Comparable-store sales rose 4.6%. Net income was $124.0 million, compared to a net loss of $10.1 million for the 52-week fiscal year in 2005. Results include both the continuing operations of the business and KB Toys, now a discontinued operation.
Big Lots is the largest broadline closeout retailer in the United States, operating 1,375 stores in 47 states.
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