Big Lots 2009 Annual Report Download - page 7

represents our first loyalty card program which will
allow us to learn more about our customers’ buying
habits, encourage more frequent visits, and/or
potentially expand our customer base. We are
encouraged about the progress to date and have
enrolled well over 1.5 million members. Our data
suggest these new Rewards members are spending
more than double what the average customer spends,
and in stores with the highest number of Rewards
members, we are experiencing measurable increases
in transactions. In 2010, we will invest further in
technology to provide us with the tools necessary to
begin to directly market to our Rewards members based
on their specific buying patterns and history. We see the
Rewards program, along with our focus on improving
the in-store shopping experience, as two key initiatives
to growing transactions and expanding our current
customer base.
Beyond our strategies, over 35,000 Big Lots
associates are dedicated to doing more to serve our
customers. As part of our mission, we encourage every
member of our team to develop strong bonds in the
communities where we live and work. We will continue
to be committed to making a difference to those we
serve by stocking food banks, supporting volunteerism,
and donating hundreds of thousands of dollars to
schools, social service agencies, and local and
national charities.
INSPIRING PERFORMANCE
As CEO, it has been my personal mission to ensure that
constant change remains a vital part of our culture. And
I can assure you the spirit of innovation is alive and well
at Big Lots.
Our ability to embrace change — to reinvent
ourselves — has been key to our success to date. We are
passionate about accomplishment and accountability.
Our desire to deliver outstanding performance is
matched by a determination to respond to new realities.
Our results demonstrate that Big Lots is a robust and
growing business that is capable of performing in both
good times and tough times. I am confident we are
well positioned as we begin 2010, and we have a solid
business plan in place that balances the need for results
today with a focus on tomorrow.
I have been with Big Lots coming up on 5 years this
summer, and I firmly believe that heading into 2010
we are better positioned than at any other time in my
tenure with the Company. Our merchandise content
and the value message continue to grow stronger
and stronger, our stores have never looked better,
inventories are flowing and well under control, and
we continue to find smart ways to leverage our cost
structure without impacting the customer. For 2010,
we have provided financial guidance that forecasts
our 4th consecutive year of record EPS from continuing
operations, accelerates store growth, generates
significant cash flow, and will return a minimum of
$150 million to shareholders in the form of share
repurchase activity.
I feel very comfortable with how we have planned
2010; however, I am more excited when I think
about the opportunities for this business longer term.
As a management team, we are focused on strategies
and initiatives to drive continued growth over the
next several years. Earlier this year, we communicated
to the marketplace a view of the next three years …
2010 through 2012. By 2012, we believe sales could
exceed $5.5 billion with an operating profit rate
of 8% and EPS from continuing operations
approaching $3.50 per diluted share. This model
would generate $650 million to $700 million of cash
while continuing to invest for the future and grow
our store base. Over the next 3 years alone, we expect
to add a net of approximately 140 stores, which
creates hundreds of opportunities for promotions for
our best performers and potentially creates in the
neighborhood of 4,000 to 5,000 jobs to do our part
to help the economy grow and improve the overall
employment picture.
In my estimation, the future for this Company has
never been brighter. Our model and execution
continue to get stronger and stronger. We have entered
into a growth mode which is the next phase of our
evolution. And with the potential for a store base
of over 2,000 stores, I see this as a 9 or 10 billion
dollar business, or nearly double the size that it
is today.
On behalf of our Board of Directors, I would like
to thank you — our community of shareholders,
customers, vendors, and suppliers — for your ongoing
support. And to all of our associates and their families,
I offer my deepest thanks and appreciation for the
hard work and commitment you give to our company
every day.
Sincerely,
Steven S. Fishman
Chairman, CEO and President
BIG LOTS, INC. 2009 ANNUAL REPORT