The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Globe Investor

News Sources

Take control of your investments with the latest investing news and analysis

Press release from PR Newswire

Bed Bath & Beyond Inc. Reports Results for Fiscal Second Quarter

Wednesday, September 21, 2011

Bed Bath & Beyond Inc. Reports Results for Fiscal Second Quarter16:15 EDT Wednesday, September 21, 2011- Net Earnings per Diluted Share of $.93 - Quarterly Net Sales Increase by Approximately 8.3% - Quarterly Comparable Store Sales Increase by Approximately 5.6% - Modeling Fiscal Third Quarter 2011 Net Earnings per Diluted Share of Approximately $.82 to $.87 - Full Year Net Earnings per Diluted Share Modeled to Increase Approximately 22% to 25%; Previously Modeled at Approximately 15% to 20%UNION, N.J., Sept. 21, 2011 /PRNewswire/ -- Bed Bath & Beyond Inc. (Nasdaq: BBBY) today reported net earnings of $.93 per diluted share ($229.4 million) in the fiscal second quarter ended August 27, 2011, an increase of approximately 33% versus net earnings of $.70 per diluted share ($181.8 million) in the same quarter a year ago.  Net sales for the fiscal second quarter of 2011 were approximately $2.314 billion, an increase of approximately 8.3% from net sales of approximately $2.137 billion reported in the fiscal second quarter of 2010.  Comparable store sales in the fiscal second quarter of 2011 increased by approximately 5.6%, compared with an increase of approximately 7.4% in last year's fiscal second quarter. During the fiscal second quarter of 2011, the Company repurchased approximately $287 million of its common stock representing approximately 5.2 million shares.  As of August 27, 2011, the remaining balance of the current share repurchase program authorized in December 2010 was approximately $1.6 billion.For the fiscal first half ended August 27, 2011, the Company reported net earnings of $1.65 per diluted share ($410.0 million), an increase of approximately 35% over net earnings of $1.22 per diluted share ($319.3 million) in the corresponding period a year ago.  Net sales for the fiscal first half of 2011 were approximately $4.424 billion, an increase of approximately 9.0% from net sales of approximately $4.060 billion in the corresponding period a year ago.  Comparable store sales for the fiscal first half of 2011 increased by approximately 6.3%, compared with an increase of approximately 7.9% in last year's fiscal first half.The Company is now modeling net earnings per diluted share to be approximately $.82 to $.87 for the fiscal third quarter of 2011 and to increase by approximately 22% to 25% for all of fiscal 2011.  As of August 27, 2011, the Company had a total of 1,155 stores, including 986 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada, 70 Christmas Tree Shops stores, 54 buybuy BABY stores and 45 stores under the names of Harmon or Harmon Face Values.  During the fiscal second quarter, the Company opened three Bed Bath & Beyond stores, seven buybuy BABY stores and four Christmas Tree Shops stores and closed one Bed Bath & Beyond store. Consolidated store space as of August 27, 2011 was approximately 35.6 million square feet. Since the beginning of the third quarter of fiscal 2011 on August 28, 2011, an additional three Bed Bath & Beyond stores and two buybuy BABY stores have been opened.  In addition, the Company is a partner in a joint venture which operates two stores in the Mexico City market under the name "Home & More."*   *   *    *    *    *    *    *Bed Bath & Beyond Inc. and subsidiaries (the "Company") is a chain of retail stores, operating under the names of Bed Bath & Beyond, Christmas Tree Shops, Harmon, Harmon Face Values and buybuy BABY.  In addition, the Company is a partner in a joint venture which operates retail stores in Mexico under the name "Home & More."  The Company sells a wide assortment of domestics merchandise and home furnishings.  Domestics merchandise includes categories such as bed linens and related items, bath items and kitchen textiles.  Home furnishings include categories such as kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings, consumables and certain juvenile products.  Shares of Bed Bath & Beyond Inc. are traded on NASDAQ under the symbol "BBBY" and are included in the Standard and Poor's 500 and Global 1200 Indices and the NASDAQ-100 Index.  The Company is counted among the Fortune 500 and the Forbes 2000.    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, 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 that may be outside the Company's control. 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 and spending habits; demographics and other macroeconomic factors that may impact the level of spending for the types of merchandise sold by the Company; unusual weather patterns; competition from existing and potential competitors; competition from other channels of distribution; pricing pressures; the ability to attract and retain associates in all areas of the organization; the cost of labor, merchandise and other costs and expenses; the ability to find suitable locations at acceptable occupancy costs to support the Company's expansion program; the impact of failed auctions for auction rate securities held by the Company; disruptions to the Company's information technology systems including but not limited to security breaches of the Company's systems protecting consumer and employee information; changes to statutory, regulatory and legal requirements; changes to, or new, tax laws or interpretation of existing tax laws; and changes to, or new, accounting standards including, without limitation, changes to lease accounting standards.  The Company does not undertake any obligation to update its forward-looking statements.  BED BATH & BEYOND INC. AND SUBSIDIARIESConsolidated Statements of Earnings(in thousands, except per share data)(unaudited)Three Months EndedSix Months EndedAugust 27,August 28,August 27,August 28,2011201020112010Net sales$   2,314,064$   2,136,730$   4,424,015$   4,059,781Cost of sales1,363,0651,261,8122,615,4442,409,827    Gross profit950,999874,9181,808,5711,649,954Selling, general and administrative expenses579,363578,0161,147,9871,127,658    Operating profit371,636296,902660,584522,296Interest (expense) income, net(1,872)327(1,320)843    Earnings before provision for income taxes369,764297,229659,264523,139Provision for income taxes140,392115,474249,314203,831    Net earnings$     229,372$     181,755$     409,950$     319,308Net earnings per share - Basic$           0.94$           0.71$           1.68$           1.24Net earnings per share - Diluted$           0.93$           0.70$           1.65$           1.22Weighted average shares outstanding - Basic242,751257,013244,148258,207Weighted average shares outstanding - Diluted246,539259,928248,169261,783BED BATH & BEYOND INC. AND SUBSIDIARIESConsolidated Balance Sheets(in thousands, unaudited)August 27,August 28,20112010AssetsCurrent assets:    Cash and cash equivalents$   1,017,990$   1,040,504    Short term investment securities724,911602,223    Merchandise inventories2,117,4141,903,096    Other current assets334,261306,571      Total current assets4,194,5763,852,394Long term investment securities113,705132,242Property and equipment, net1,128,9981,105,297Other assets311,197350,079$   5,748,476$   5,440,012Liabilities and Shareholders' EquityCurrent liabilities:    Accounts payable$      848,063$      771,752    Accrued expenses and other current liabilities328,680306,316    Merchandise credit and gift card liabilities195,688179,119    Current income taxes payable19,26525,244      Total current liabilities1,391,6961,282,431Deferred rent and other liabilities312,584262,198Income taxes payable133,150110,642    Total liabilities1,837,4301,655,271    Total shareholders' equity3,911,0463,784,741$   5,748,476$   5,440,012BED BATH & BEYOND INC. AND SUBSIDIARIESConsolidated Statements of Cash Flows(in thousands, unaudited)Six Months EndedAugust 27,August 28,20112010Cash Flows from Operating Activities:  Net earnings$   409,950$   319,308  Adjustments to reconcile net earnings to net cash      provided by operating activities:      Depreciation88,11089,882      Stock-based compensation24,26822,636      Tax benefit from stock-based compensation (2,736)(2,660)      Deferred income taxes(11,946)(11,281)      Other(915)(694)      (Increase) decrease in assets:          Merchandise inventories(148,507)(143,393)          Trading investment securities(557)(1,859)          Other current assets16,284(29,525)          Other assets685(2,562)      Increase (decrease) in liabilities:          Accounts payable141,161168,903          Accrued expenses and other current liabilities21,19524,322          Merchandise credit and gift card liabilities2,6276,315          Income taxes payable(60,297)(51,370)          Deferred rent and other liabilities6,83116,080  Net cash provided by operating activities486,153404,102Cash Flows from Investing Activities:  Purchase of held-to-maturity investment securities(856,012)(780,750)  Redemption of held-to-maturity investment securities731,250555,020  Redemption of available-for-sale investment securities15,55014,025  Redemption of trading investment securities-42,825  Capital expenditures(89,598)(83,574)  Net cash used in investing activities(198,810)(252,454)Cash Flows from Financing Activities:  Proceeds from exercise of stock options77,70370,054  Excess tax benefit from stock-based compensation9231,038  Repurchase of common stock, including fees(531,566)(278,336)  Net cash used in financing activities(452,940)(207,244)  Net decrease in cash and cash equivalents(165,597)(55,596)Cash and cash equivalents:  Beginning of period1,183,5871,096,100  End of period$   1,017,990$   1,040,504SOURCE Bed Bath & Beyond Inc.For further information: INVESTOR CONTACTS: Kenneth C. Frankel, +1-908-855-4554, or Eugene A. Castagna, +1-908-855-4110