UNION, N.J., Sept. 26, 2018 /PRNewswire/ -- Bed Bath &
Beyond Inc. (Nasdaq: BBBY) today reported financial results for the
second quarter of fiscal 2018 ended September 1, 2018.
Fiscal 2018 Second Quarter Results
For the fiscal 2018 second quarter, the Company reported net
earnings of $.36 per diluted share
($48.6 million), compared with
$.67 per diluted share ($94.2 million) for the fiscal 2017 second
quarter. Net sales for the fiscal 2018 second quarter were
approximately $2.9 billion, flat to
the prior year quarter. Comparable sales in the fiscal 2018
second quarter decreased by approximately 0.6%, and included strong
sales growth from the Company's customer-facing digital channels,
and sales from stores that declined in the mid-single-digit
percentage range.
Capital Allocation
The Company's Board of Directors today declared a quarterly
dividend of $.16 per share payable on
January 15, 2019 to shareholders of
record at the close of business on December
14, 2018.
During the fiscal 2018 second quarter, the Company repurchased
approximately $41 million of its
common stock, representing approximately 2.1 million shares, under
its existing $2.5 billion share
repurchase program. As of September 1,
2018, the program had a remaining balance of approximately
$1.4 billion.
The Company ended the fiscal 2018 second quarter with
approximately $1.1 billion in cash
and investment balances, an increase of approximately $532 million, compared with approximately
$563 million at the end of the fiscal
2017 second quarter.
Fiscal 2018
During the conference call with analysts and investors, the
Company plans to review its quarterly results and its financial
planning assumptions for fiscal 2018.
The Company's planning assumptions reflect actual results
through the fiscal second quarter, the current trends the Company
has been experiencing, and other factors to be discussed on the
conference call. Based on its planning assumptions, the
Company has slightly reduced its net sales model, with comparable
sales to be relatively flat to last year, and net earnings per
diluted share for the full year to be at the low end of its
previously modeled range, at about $2.00.
In connection with its three-year financial goals that comprise
its vision for 2020, the Company remains on track to achieve
moderating declines in operating profit and net earnings per
diluted share in fiscal 2018 and fiscal 2019, and to achieve growth
in net earnings per diluted share by fiscal 2020.
Fiscal 2018 Second Quarter Conference Call and Investor
Presentation
Bed Bath & Beyond Inc.'s fiscal 2018 second quarter
conference call may be accessed by dialing 1-888-771-4371, or if
international, 1-847-585-4405, using conference ID number 47547438.
The replay of the call can be accessed by dialing 1-888-843-7419,
using conference ID number 47547438. The call and replay can
also be accessed via audio webcast on the investor relations
section of our website at www.bedbathandbeyond.com.
The Company has also made available an Investor Presentation on
the investor relations section of its website that provides
information related to its strategic initiatives, fiscal second
quarter financial results, and modeling assumptions for fiscal
2018.
About the Company
Bed Bath & Beyond Inc. and subsidiaries (the "Company") is
an omnichannel retailer selling a wide assortment of domestics
merchandise and home furnishings which operates under the names Bed
Bath & Beyond, Christmas Tree Shops, Christmas Tree Shops
andThat! or andThat!, Harmon, Harmon Face Values or Face Values,
buybuy BABY and World Market, Cost Plus World Market or Cost Plus.
Customers can purchase products either in-store, online, with a
mobile device or through a customer contact center. The Company
generally has the ability to have customer purchases picked up
in-store or shipped direct to the customer from the Company's
distribution facilities, stores or vendors. In addition, the
Company operates Of a Kind, an e-commerce website that features
specially commissioned, limited edition items from emerging fashion
and home designers; One Kings Lane,
an authority in home décor and design, offering a unique collection
of select home goods, designer and vintage items;
PersonalizationMall.com, an industry-leading online retailer of
personalized products; Chef Central, an online retailer of
kitchenware, cookware and homeware items catering to cooking and
baking enthusiasts; and Decorist, an online interior design
platform that provides personalized home design services. The
Company also operates Linen Holdings, a provider of a variety of
textile products, amenities and other goods to institutional
customers in the hospitality, cruise line, healthcare and other
industries. Additionally, the Company is a partner in a joint
venture which operates retail stores in Mexico under the name Bed Bath &
Beyond.
The Company operates websites at bedbathandbeyond.com,
bedbathandbeyond.ca, worldmarket.com, buybuybaby.com,
buybuybaby.ca, christmastreeshops.com, andthat.com,
harmondiscount.com, facevalues.com, ofakind.com, onekingslane.com,
personalizationmall.com, chefcentral.com, decorist.com,
harborlinen.com, and t-ygroup.com. As of September 1, 2018, the Company had a total of
1,560 stores, including 1,018 Bed Bath & Beyond stores in all
50 states, the District of
Columbia, Puerto Rico and
Canada, 281 stores under the names
of World Market, Cost Plus World Market or Cost Plus, 121 buybuy
BABY stores, 83 stores under the names Christmas Tree Shops,
Christmas Tree Shops andThat! or andThat!, and 57 stores under the
names Harmon, Harmon Face Values or Face Values. During the
fiscal second quarter, the Company opened one Bed Bath & Beyond
store and two World Market stores. The joint venture, to
which the Company is a partner, operates ten stores in Mexico under the name Bed Bath &
Beyond.
Forward-Looking Statements
This press release may contain forward-looking statements.
Many of these forward-looking statements can be identified by use
of words such as may, will, expect, anticipate, approximate,
estimate, assume, continue, model, project, plan, goal, and similar
words and phrases. The Company's actual results and future
financial condition may differ materially from those expressed in
any such forward-looking statements as a result of many factors.
Such factors include, without limitation: general economic
conditions including the housing market, a challenging overall
macroeconomic environment and related changes in the retailing
environment; consumer preferences, spending habits and adoption of
new technologies; demographics and other macroeconomic factors that
may impact the level of spending for the types of merchandise sold
by the Company; civil disturbances and terrorist acts; unusual
weather patterns and natural disasters; competition from existing
and potential competitors across all channels; pricing pressures;
liquidity; the ability to achieve anticipated cost savings, and to
not exceed anticipated costs, associated with organizational
changes and investments; the ability to attract and retain
qualified employees in all areas of the organization; the cost of
labor, merchandise and other costs and expenses; potential supply
chain disruption due to trade restrictions, political instability,
labor disturbances, product recalls, financial or operational
instability of suppliers or carriers, and other items; the ability
to find suitable locations at acceptable occupancy costs and other
terms to support the Company's plans for new stores; the ability to
establish and profitably maintain the appropriate mix of digital
and physical presence in the markets it serves; the ability to
assess and implement technologies in support of the Company's
development of its omnichannel capabilities; uncertainty in
financial markets; volatility in the price of the Company's common
stock and its effect, and the effect of other factors, on the
Company's capital allocation strategy; disruptions to the Company's
information technology systems including but not limited to
security breaches of systems protecting consumer and employee
information or other types of cybercrimes or cybersecurity attacks;
reputational risk arising from challenges to the Company's or a
third party product or service supplier's compliance with various
laws, regulations or standards, including those related to labor,
health, safety, privacy or the environment; reputational risk
arising from third-party merchandise or service vendor performance
in direct home delivery or assembly of product for customers;
changes to statutory, regulatory and legal requirements, including
without limitation proposed changes affecting international trade;
changes to, or new, tax laws or interpretation of existing tax
laws; new, or developments in existing, litigation, claims or
assessments; changes to, or new, accounting standards; foreign
currency exchange rate fluctuations; and the integration of
acquired businesses. The Company does not undertake any
obligation to update its forward-looking statements.
BED BATH
& BEYOND INC. AND SUBSIDIARIES
|
Consolidated Statements of
Earnings
|
(in
thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
1,
|
|
August
26,
|
|
September
1,
|
|
August
26,
|
|
|
|
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
2,935,018
|
|
$
|
2,936,357
|
|
$
|
5,688,685
|
|
$
|
5,678,498
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
|
1,946,457
|
|
|
1,867,798
|
|
|
3,735,276
|
|
|
3,609,824
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
988,561
|
|
|
1,068,559
|
|
|
1,953,409
|
|
|
2,068,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
909,703
|
|
|
899,712
|
|
|
1,793,322
|
|
|
1,752,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
|
78,858
|
|
|
168,847
|
|
|
160,087
|
|
|
315,858
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
14,611
|
|
|
19,166
|
|
|
31,343
|
|
|
35,746
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before
provision for income taxes
|
|
64,247
|
|
|
149,681
|
|
|
128,744
|
|
|
280,112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
15,608
|
|
|
55,451
|
|
|
36,529
|
|
|
110,599
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
|
$
|
48,639
|
|
$
|
94,230
|
|
$
|
92,215
|
|
$
|
169,513
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
share - Basic
|
$
|
0.36
|
|
$
|
0.67
|
|
$
|
0.68
|
|
$
|
1.21
|
|
|
Net earnings per
share - Diluted
|
$
|
0.36
|
|
$
|
0.67
|
|
$
|
0.68
|
|
$
|
1.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding - Basic
|
|
135,410
|
|
|
139,868
|
|
|
135,698
|
|
|
140,599
|
|
|
Weighted average
shares outstanding - Diluted
|
|
135,675
|
|
|
140,211
|
|
|
136,138
|
|
|
141,176
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share
|
$
|
0.16
|
|
$
|
0.15
|
|
$
|
0.32
|
|
$
|
0.30
|
|
BED BATH &
BEYOND INC. AND SUBSIDIARIES
|
Consolidated
Balance Sheets
|
(in
thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
1,
|
|
August
26,
|
|
|
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
|
869,297
|
|
$
|
464,062
|
|
|
Short term
investment securities
|
|
|
205,916
|
|
|
-
|
|
|
Merchandise
inventories
|
|
|
|
2,813,588
|
|
|
2,878,638
|
|
|
Prepaid
expenses and other current assets
|
|
|
387,343
|
|
|
187,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
|
|
4,276,144
|
|
|
3,530,364
|
|
|
|
|
|
|
|
|
|
|
|
|
Long term investment
securities
|
|
|
|
19,742
|
|
|
99,157
|
|
Property and
equipment, net
|
|
|
|
1,881,957
|
|
|
1,834,470
|
|
Goodwill
|
|
|
|
|
716,283
|
|
|
707,127
|
|
Other
assets
|
|
|
|
|
425,737
|
|
|
611,541
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
7,319,863
|
|
$
|
6,782,659
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
$
|
1,366,161
|
|
$
|
1,168,092
|
|
|
Accrued expenses and
other current liabilities
|
|
|
748,629
|
|
|
486,719
|
|
|
Merchandise credit
and gift card liabilities
|
|
|
329,227
|
|
|
318,407
|
|
|
Current income taxes
payable
|
|
|
-
|
|
|
15,802
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
|
|
2,444,017
|
|
|
1,989,020
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred rent and
other liabilities
|
|
|
|
427,118
|
|
|
514,902
|
|
Income taxes
payable
|
|
|
|
54,010
|
|
|
65,203
|
|
Long term
debt
|
|
|
|
|
1,492,310
|
|
|
1,491,836
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
|
4,417,455
|
|
|
4,060,961
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
|
Preferred stock -
$0.01 par value; authorized - 1,000
|
|
|
|
|
|
|
|
shares; no
shares issued or outstanding
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock - $0.01
par value; authorized - 900,000 shares;
|
|
|
|
|
|
|
|
issued 342,708
and 341,582, respectively;
|
|
|
|
|
|
|
|
|
outstanding
138,051 and 143,242 shares, respectively
|
|
3,427
|
|
|
3,416
|
|
|
Additional paid-in
capital
|
|
|
|
2,096,282
|
|
|
2,022,826
|
|
|
Retained
earnings
|
|
|
|
11,386,561
|
|
|
11,130,348
|
|
|
Treasury stock, at
cost; 204,657 and 198,340 shares, respectively
|
|
(10,530,712)
|
|
|
(10,399,254)
|
|
|
Accumulated other
comprehensive loss
|
|
|
(53,150)
|
|
|
(35,638)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
|
2,902,408
|
|
|
2,721,698
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
7,319,863
|
|
$
|
6,782,659
|
BED BATH &
BEYOND INC. AND SUBSIDIARIES
|
Consolidated
Statements of Cash Flows
|
(in thousands,
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
1,
|
|
August
26,
|
|
|
|
|
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
|
|
|
|
$
|
92,215
|
|
$
|
169,513
|
|
|
Adjustments to
reconcile net earnings to net cash
|
|
|
|
|
|
|
|
|
|
provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
|
161,668
|
|
|
148,497
|
|
|
|
Stock-based
compensation
|
|
|
|
37,043
|
|
|
36,904
|
|
|
|
Deferred income
taxes
|
|
|
|
|
(4,074)
|
|
|
(10,707)
|
|
|
|
Other
|
|
|
|
|
|
(1,029)
|
|
|
182
|
|
|
|
(Increase) decrease
in assets, net of effect of acquisitions:
|
|
|
|
|
|
|
|
|
Merchandise
inventories
|
|
|
|
(85,805)
|
|
|
31,852
|
|
|
|
Trading investment
securities
|
|
|
(4,174)
|
|
|
(9,221)
|
|
|
|
Other current
assets
|
|
|
|
175,479
|
|
|
10,590
|
|
|
|
Other assets
|
|
|
|
|
1,475
|
|
|
(4,052)
|
|
|
|
Increase (decrease)
in liabilities, net of effect of acquisitions:
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
|
|
218,945
|
|
|
22,004
|
|
|
|
Accrued expenses and other
current liabilities
|
|
|
51,734
|
|
|
2,723
|
|
|
|
Merchandise credit and gift
card liabilities
|
|
|
5,774
|
|
|
8,604
|
|
|
|
Income taxes
payable
|
|
|
|
(7,268)
|
|
|
(46,766)
|
|
|
|
Deferred rent and other
liabilities
|
|
|
(2,967)
|
|
|
4,578
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
|
639,016
|
|
|
364,701
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of
held-to-maturity investment securities
|
|
|
(121,625)
|
|
|
-
|
|
|
Redemption of
held-to-maturity investment securities
|
|
|
298,125
|
|
|
-
|
|
|
Capital
expenditures
|
|
|
|
|
(181,541)
|
|
|
(176,955)
|
|
|
Payment for
acquisition, net of cash acquired
|
|
|
-
|
|
|
(5,207)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
|
|
(5,041)
|
|
|
(182,162)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
exercise of stock options
|
|
|
-
|
|
|
10,161
|
|
|
Payment of
dividends
|
|
|
|
|
(43,401)
|
|
|
(39,241)
|
|
|
Repurchase of common
stock, including fees
|
|
|
(62,740)
|
|
|
(183,715)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
financing activities
|
|
|
|
(106,141)
|
|
|
(212,795)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(4,677)
|
|
|
5,989
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
523,157
|
|
|
(24,267)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
|
|
|
|
|
|
Beginning of
period
|
|
|
|
|
346,140
|
|
|
488,329
|
|
|
End of
period
|
|
|
|
|
$
|
869,297
|
|
$
|
464,062
|
View original
content:http://www.prnewswire.com/news-releases/bed-bath--beyond-inc-reports-results-for-fiscal-2018-second-quarter-300719746.html
SOURCE Bed Bath & Beyond Inc.