Big Lots on Thursday morning said EVP merchandising Doug Wurl had resigned from the company and John Martin had been promoted to the EVP and chief merchandising officer role. Martin had previously served as EVP merchandising after joining the company in 2003, but last April the company moved him into an EVP administration role when Wurl joined the company from Sears Holdings where he served as a VP and general merchandise manager.

Filling Martin’s administration role is Charles W. Haubiel II. He will continue to serve as general counsel and corporate secretary with responsibility for legal and real estate while adding responsibility for human resources and loss prevention. He joined Big Lots in 1997.

In other moves, Lisa Bachmann was elevated to the role of EVP and COO after previously serving as chief information officer. She will retain her CIO responsibilities and add stores operations to her duties. Bachmann has been with Big Lots since 2002 when she joined the company as SVP merchandise planning and allocation. She became CIO in 2005.

The company also named Timothy Johnson CFO. Johnson joined Big Lots in 2000 and previously served as SVP finance.

The personnel moves were announced in advance of the release of disappointing second quarter financial results that saw the company reduce its outlook for the full year. During the second quarter ended July 28, Big Lots said profits from continuing operations declined to $22.1 million, or 36 cents a share, from $35.7 million, or 50 cents as share, the prior year. Sales for the period increased to nearly $1.218 billion from $1.167 billion the prior year as the opening of 18 new stores added sales volume that was offset by a 1.9% U.S. same-store sales decline.

Net sales for U.S. operations for the second quarter increased 7% to $1,183 billion, compared to $1,163 billion while income from continuing U.S. operations totaled 42 cents a share compared to 52 cents.

The performance of company’s recently acquired operations in Canada was more difficult to gauge.

“As a reminder, we acquired our Canadian operations on July 18, 2011, therefore, prior year results include only our 12 days of ownership in the second quarter of fiscal 2011,” the company said in a statement. “Based on materiality to our total operations, we are not required to and have not provided pro-forma information for Canadian operations.
The company did say sales from Canadian operations totaled $35 million and incurred a net loss of $3.3 million that added five cents a share to the total profit decline, compared to the prior year’s sales from the 12 day period of $3.9 million and net loss of $1.2 million or two cents a share.

Based on the company’s performance during the first half of the year, Big Lots reduced its full year profit forecast to a range of $2.80 to $2.95 from earlier guidance that envisioned profits between $3.25 and $3.40 as a worse than expected U.S. performance is partially offset by a better than expected showing in Canada.

Looking at the U.S. business, the company said it expects same-store sales to decline in the low single digit range and profits from continuing operations to range from $3.05 to $3.15 compared to prior guidance of $3.50 to $3.60. Conversely, sales in Canada are expected to range between $152 million and $158 million, compared with prior expectations of sales between $142 million and $152 million. As a result, the operating loss is expected to range from $13 to $15 million, or 22 cents to 26 cents a share, figures that are slightly less worse than earlier expectations for an operating loss in the range of $14 to $16 million, or 23 cents to 26 cents a share.

Big Lot’s is the largest operator of closeout stores in North America with 1,463 Big Lots stores in 48 states and 81 Liquidation World and LW stores in Canada.

According to the company, the loss was due in part to the departure of former CEO, Kathleen Mason, who is suing the company on the claim that Tuesday Morning fired her because she was diagnosed with breast cancer. Excluding costs associated with the departure of Mason, net loss for the fourth quarter was $0.7 million, or a 2 cents per share.

As previously announced, net sales for the fourth quarter of fiscal 2012 were $196.4 million compared with  $194.8 million for the quarter ended June 30, 2011, an increase of 0.8%. Comparable-store sales increased 0.2% for the fourth quarter, consisting of a 2.9% increase in average ticket offset by a 2.7% decrease in traffic.

Michael Marchetti, president and interim CEO, stated, “As we move into the new fiscal year, we are focused on improving our sales performance. Innovative sourcing of new merchandise, implementing merchandise initiatives with respect to better allocation and in-stock positions, improved e-commerce performance, a new customer loyalty program, and continued improvement in our store portfolio are all being deployed to drive sales growth and improve profitability. With our strong balance sheet, characteristic cost discipline and the initiatives to drive sales, we are well positioned to deliver improved financial performance in fiscal 2013.”

As of June 30, Tuesday Morning operated 852 stores in 43 state. During the fourth quarter of fiscal 2012, the company opened 4 stores, relocated 8 stores and closed 4 stores. During the fiscal year ended June 30 the company opened 24 stores, closed 33 stores and relocated 45 stores.

For fiscal 2013, the company expects net sales to range from $820 million to $830 million. Comparable-store sales are planned to be roughly flat and earnings per diluted share to be in the range of 18 cents to 23 cents.

“Our results fell short of our overall expectations,” said Robert Niblock, Lowe’s chairman, president and CEO. “However, I have confidence in our strategy and in our employees, and while we recognize the significant magnitude of change that we’ve asked the organization to absorb as we transform our business, we fully understand that we must improve our level of execution.”

The world’s second largest home improvement retailer posted sales of $14.2 billion in the quarter, down 2.0% from $14.5 billion in the same quarter last year. Comp-store sales in the quarter were negative 0.4%.

Earnings of $747 million were down 10.0% from the same quarter a year ago.

The quarterly comparisons in 2012, which is a 52-week year, are impacted by a shift in comparable weeks, the company said. For the six-month period, comparable-store sales increased 1.0%

As of Aug. 3, 2012, Lowe’s operated 1,748 stores in the United States, Canada and Mexico, representing 196.8 million sq. ft. of retail selling space.

That compares with rival Home Depot’s store count of 2,255 stores. Last week, Home Depot

PLEASANTON, Calif. — A new era is beginning at Ross Stores, as the company set out plans to elect a new CEO in 2014. At the same time, the company continues to put its trust behind vice chairman and CEO Michael Balmuth, agreeing to extend Balmuth’s employment agreement through May 2016.

The agreement calls for Balmuth, 62, to continue as CEO until June 1, 2014, when he will become executive chairman. At the same time, the board expects to elect a new CEO from among its senior executives. The new CEO will report directly to the board of directors and assume responsibility for most areas of the business.

In his new role as executive chairman, Balmuth will remain an active employee of the company with property development and dd’s Discounts continuing to report to him.  Norman Ferber, the company’s chairman of the board, will become chairman emeritus in June 2014, with his current consulting responsibilities to remain unchanged.

In commenting on behalf of the board, Ferber said, “Michael Balmuth is an exceptional CEO whose leadership has been instrumental to our long-term success. He has built a team of very knowledgeable and seasoned executives who have been extremely proficient in developing and executing the right strategies for our business. This succession plan will enable us to continue to benefit from Michael’s more than two decades of significant management experience at Ross, while helping to ensure a seamless transition.”

Ross Stores has consistently delivered impressive sales and profits, as it resonates with the value-minded consumer.

Looking ahead, Balmuth noted, “The board and I firmly believe this type of management transition will allow us to remain focused on executing the strategies that have been key to our outstanding financial results over the past several years. We are also confident this succession plan will help us continue to maximize future stockholder returns.”

Since its founding in 1982, the chain has expanded to 302 extreme value stores in four states consisting of 220 stores in California, 37 in Texas, 29 in Arizona, and 15 in Nevada. As part of the celebration, the company is converting 40 semi-trucks from diesel to clean-burning compressed natural gas. Additionally, the company is offering a free reusable shopping bag to customers who visit the store this weekend and purchase at least $9.99 worth of merchandise.

“We are thrilled to be marking this important 30 year milestone by making this announcement which will help save the planet, use a plentiful domestic resource and help save our customers money. We believe we will have one of the nation’s largest retail fleets operating on compressed natural gas,” 99 Cents Only CEO Eric Schiffer said.

For its most recent quarter, the retailer reported that total sales increased 10.6% to $403.9 from $365.4 million for the same quarter last year.

The company’s overall same-store sales for the third quarter of fiscal 2012 increased 8.5%. 

The retailer said sales for the second quarter ended July 28 declined 22.6% to a little more than $3 billion, resulting in a $147 million loss, or 67 cents per share. After adjusting for $159 million in restructuring charges, the company reported a loss of $81 million, or 37 cents per share. The 21.7% comp decline follows a first-quarter decline of 18.9%.

Sales were negatively affected by the company’s decision to significantly reduce its marketing activities during the latter half of the quarter, as it made adjustments to a pricing strategy implemented at the beginning of the year that confused shoppers. Meanwhile, gross margins suffered as the company lost leverage on sales and continued the process of clearing merchandise as part of its broad transformation. The company’s gross margin rate stood at 33.2%, compared with 38.3% the prior year.

“We have now completed the first six months of our transformation and while business continues to be softer than anticipated, we are confident the transformation of JCPenney is on track,” Johnson said. “The transition from a highly promotional business model to one based on everyday value will take time and we will stay the course.”

On Aug. 1, the company shifted from its three-tier pricing model launched at the beginning of the year to a truer version of an everyday low price strategy that involves everday prices and clearance prices.

“This month we simplified our pricing, launched the first of our new shops, and accelerated our marketing efforts to focus on brands, products and value. Early response to these efforts has been very encouraging,” Johnson said.

During a live conference call, Johnson and CFO Ken Hannah went to great lengths to reassure investors the company has ample cash on hand and other liquidity measures in place to see it through the transformation process.

The company ended the quarter with $888 million in cash and an untapped $1.5 billion line of credit backed by $3 billion worth of inventory.

Hannah said the company expects to be able to fund its multiyear process of converting stores to a series of shops with well known brands through cash generated by operations.

“We currently aren’t using this line of credit at all,” Hannah said, “But we have access should we need it.”

The retailer reported second quarter net income of $240 million, or $1 per diluted share, compared with $299 million, or $1.08 per diluted share, a year ago. Net sales were $4.2 billion, a decrease of 1% for the quarter. Comparable-store sales for the quarter decreased 2.7%.

Kevin Mansell, Kohl’s chairman, president and CEO, said, “Our sales performance in the second quarter was disappointing. Our gross margin performance for the quarter, however, was better than expected. Our teams remain disciplined in their expense management and, again, delivered solid results. We accomplished our goal of improving inventory levels for the fall season and our sales improved considerably in July as units were received. As we look forward to the fall season, we are excited about the fashion content and level of newness in our assortments.”

By the end of the quarter, Kohl’s operated 1,134 stores in 49 states, compared with 1,097 stores at the same time last year. During the first half of the year, the company opened 9 new stores, including 1 relocated store, closed 1 store and completed 40 remodels. The company expects to open an additional 12 stores and complete an additional 10 remodels in September.

Kohl’s expects earnings for the third quarter to range from 83 cents to 89 cents per diluted share, based on expected sales growth of 1% to 3% and comparable-store sales growth of flat to 2%. After incorporating its second quarter results and third quarter outlook, the company now expects to earn $4.50 to $4.65 per diluted share for fiscal 2012 versus its previous guidance of $4.75 per diluted share.

DALLAS — A lawyer representing former Tuesday Morning CEO Kathleen Mason asserts the closeout retailer fire her upon learning she was diagnosed with breast cancer.

Kathleen Mason, the former President and CEO of the Dallas-based, closeout retailer, has filed charges of disability discrimination against her former employer with the Equal Employment Opportunity Commission (EEOC).
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In the filing, Mason said she was removed from her leadership role in June after disclosing to the Tuesday Morning board that she was battling breast cancer. Mason led the company to 12 consecutive years of profitability before her firing.
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“Current quarterly estimates were down at the company, but this is a woman who had proven to be a more-than-effective leader and prepared the company to weather the current economic downturn,” said attorney Rogge Dunn of Dallas’ Clouse Dunn LLP, who represents Mason.
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Dunn notes that Tuesday Morning had been profitable every year Mason led the company, and that the company has no long-term debt. During her tenure, private equity investors led by Madison Dearborn saw an initial investment of approximately $117 million grow in value to more than $700 million, says Mr. Dunn.
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“Given her record, this is someone any company would want leading them through these challenging times. But instead, the board’s attitude toward Kathleen changed after it learned of her breast cancer diagnosis and treatment,” he said. “But those who know Kathleen know that she would never allow her health to become a corporate liability.”
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The severance package offered to Mason emphasized medical benefits and included a 10-year consultancy clause, after which an 18-month non-compete clause would begin, in effect locking her out of working elsewhere for nearly 12 years.
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“The board made it clear she was not being fired ‘for cause’ and the company wanted to retain her expertise for another 11½ years. One has to question why she was removed from her job,” said Dunn.
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At the time of her dismissal, Tuesday Morning announced that it “relieved Kathleen Mason of her duties as president and CEO” and did not comment on her performance or the reason for the decision.

“The board of directors concluded it was the right time to transition leadership to a new executive who will guide the company through its next stage” said Bruce Quinnell, the chairman of the board, in a press statement.