* To buy Canada-based Liquidation World Inc for about C$1.8 mln
* Q1 shr $0.70 vs est. $0.69
* Q1 sales $1.23 bln, in line with estimates
* Sees Q2 shr from cont ops $0.38-$0.48 vs est. $0.53
* Sees FY shr from cont ops $$2.75-$2.90 vs est. $3.03 (Focuses on FY outlook, adds background on rivals' results)
May 26 (Reuters) - Close-out retailer Big Lots Inc cut its full-year profit and same-store sales outlook after the company's business softened in the latter half of the first quarter, with comparable store sales now expected to be flat at best.
Retailers like Big Lots and Wal-Mart Stores Inc that cater to price-conscious shoppers are facing greater challenges as their core customer battles rising prices of food and gas.
Earlier this month, larger rival Wal-Mart reported its eighth straight quarterly decline in sales at U.S. stores open at least a year. [ID:nN17129936]
Results from Target Corp and BJ's Wholesale Club Inc , earlier this month, also showed shoppers spending cautiously. [ID:nN18234364]
For the full year, Big Lots now expects income from continuing operations of $2.75-$2.90 a share, with same-store sales expected to range from flat to a decline of 2 percent.
Analysts were expecting the company to earn $3.03, according to Thomson Reuters I/B/E/S.
For the first quarter, the Columbus, Ohio-based company reported net income of $52.5 million, or 70 cents a share, compared with $55.9 million, or 68 cents, last year.
The company's profit edged past Wall Street's expectations of 69 cents a share.
Sales fell marginally to $1.23 billion, in line with analysts expectations.
Separately, the company also said it will buy Canada-based Liquidation World Inc for about C$1.8 million, in what will be Big Lots' first expansion of its retail operations outside the U.S.
Shares of the company, which stocks its stores with merchandise that has been overproduced, discontinued or rejected by other retailers, closed at $32.33 on Wednesday on the New York Stock Exchange. (Reporting by Abhishek Takle in Bangalore; Editing by Sriraj Kalluvila) ((firstname.lastname@example.org; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters messaging: email@example.com