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Big Lots enhances liquidity, adds borrowing capacity

Big Lots more than 1,420 stores in 48 states.
Big Lots has more than 1,300 stores in 48 states.

Big Lots has increased its borrowing capacity by up to $200 million.

In a move that it said would enhance its ability “to pursue extreme bargain deals,” Big Lots has added to its borrowing capacity with a new "first in, last out" term loan facility through 1903P Loan Agent, an affiliate of Gordon Brothers Capital. The discounter said the term loan facility significantly enhances its liquidity position and is incremental to the borrowing capacity within its current $900 million asset-based revolving loan facility.

Big Lots noted that it achieved significant sequential improvement in its results during 2023 and, as reported on its March 2024, earnings call, expects further improvements during the year. The company also indicated during the call that it was continuing to evaluate additional actions to bolster its liquidity.

"We remain fully committed to improving our results and returning the company to health and prosperity," said Jonathan Ramsden, chief financial and administrative officer of Big Lots. "The financing announced today gives us additional flexibility as we continue our focus on delivering extreme bargains and unmistakable value to our customers. We are confident that our five key actions will drive significant improvement in sales and gross margin in the coming quarters."

Big Lots has identified five key actions to reclaim its bargain heritage, which include owning bargains and closeouts and communicating “unmistakable value.” Through its extreme value sourcing, Big Lots said it is focused on becoming the premier partner for closeouts and liquidations, growing bargain offerings to 75% of sales, and creating an annual pipeline of closeout deals worth more than $1 billion at original retail value across furniture, décor, and pantry essentials.

In February, Big Lots closed on a deal to acquire the entire inventory of the Hearthsong brand of children's toys. The inventory, valued at more than $22 million, will bring more than 500 new SKUs to Big Lots stores across the country.

“We're reclaiming our bargain heritage, and with this impressive acquisition from Hearthsong, our extreme value sourcing team of closeout buyers is delivering on our promise to own closeouts and bring dynamic, innovative products at unmatched prices to our customers," stated Big Lots president and CEO Bruce Thorn.

In a move to enhance its competitiveness in sourcing products, including closeout deals and extreme bargains, Big Lots has opened two international buying offices, “strategically” located in Shanghai, China and Ho Chi Minh City, Vietnam.

Headquartered in Columbus, Ohio, Big Lots operates more than 1,300 stores in 48 states.

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