BBBY
$14.11
Bed Bath & Beyond
$.27
1.95%
Earnings Details
2nd Quarter August 2018
Wednesday, September 26, 2018 4:15:00 PM
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Summary

Bed Bath & Beyond Misses

Bed Bath & Beyond (BBBY) reported 2nd Quarter August 2018 earnings of $0.38 per share on revenue of $2.9 billion. The consensus earnings estimate was $0.51 per share on revenue of $3.0 billion. The Earnings Whisper number was $0.50 per share. Revenue fell 0.0% compared to the same quarter a year ago.

The company said it now expects fiscal 2019 earnings of approximately $2.00 per share. The company's previous guidance was for earnings in the low-to-mid $2.00 per share range and the current consensus earnings estimate is $2.32 per share for the year ending February 28, 2019.

Bed Bath & Beyond Inc operates a chain of retail stores. It operates under the names Bed Bath & Beyond, Christmas Tree Shops, Harmon and Harmon Face Values, buybuy BABY & World Market or Cost Plus World Market.

Results
Reported Earnings
$0.38
Earnings Whisper
$0.50
Consensus Estimate
$0.51
Reported Revenue
$2.94 Bil
Revenue Estimate
$2.95 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Bed Bath & Beyond Inc. Reports Results For Fiscal 2018 Second Quarter

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

 

Cision 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.