- Quarterly Net Earnings Increase to $.52 Per Diluted Share
- Quarterly Net Sales Increase by 10.8%
- Quarterly Comparable Store Sales Increase by 0.8%
- Estimates Earnings Per Diluted Share of $.64 to $.67 for Fourth Quarter
Ending March 1, 2008
- Opens First Bed Bath & Beyond Store in Canada
UNION, N.J., Jan. 3 /PRNewswire-FirstCall/ -- Bed Bath & Beyond Inc. today reported net earnings of $.52 per diluted share ($138.2 million) in the fiscal third quarter ended December 1, 2007, compared with net earnings of $.50 per diluted share ($142.4 million) in the same quarter a year ago. Net earnings in this year's third quarter included a net $8.0 million benefit due to the favorable resolution of discrete tax items required to be recorded in the quarter. Net sales for the fiscal third quarter of 2007 were approximately $1.795 billion, an increase of approximately 10.8% from net sales of approximately $1.619 billion reported in the fiscal third quarter of 2006. Comparable store sales in the fiscal third quarter of 2007 grew by approximately 0.8%, compared with an increase of approximately 4.6% in last year's fiscal third quarter.
During the fiscal third quarter of 2007, the Company repurchased approximately 3.2 million shares of its common stock for an aggregate cost of approximately $103 million. Through December 1, 2007, including repurchases made during its fiscal third quarter, the Company repurchased approximately 24.5 million shares, for an aggregate cost of approximately $929 million, under the $1 billion share repurchase program authorized in December 2006.
For the fiscal nine months ended December 1, 2007, the Company reported net earnings of $1.44 per diluted share ($389.9 million), compared with net earnings of $1.36 per diluted share ($388.4 million) in the corresponding period a year ago. Net sales for the fiscal nine months of 2007 were approximately $5.116 billion, an increase of approximately 10.7% from net sales of approximately $4.622 billion reported in the corresponding period a year ago. Comparable store sales for the fiscal nine months increased by approximately 1.5%, compared with an increase of approximately 4.8% in last year's fiscal nine months.
For the fiscal fourth quarter of 2007, ending March 1, 2008, the Company estimates it will earn approximately $.64 to $.67 per diluted share based, in part, upon a projected flat comparable store sales percentage for the quarter. This would bring the Company's full year earnings estimate to a range from approximately $2.08 to $2.11 per diluted share. The fiscal 2007 fourth quarter and full year have one less week than last year's corresponding periods, as fiscal 2006 was a fifty-three week year.
As of December 1, 2007, the Company operated a total of 946 stores, including 859 Bed Bath & Beyond stores (28 of which were opened during the fiscal third quarter) in 49 states, the District of Columbia and Puerto Rico. Also as of that date, buybuy BABY operated 8 stores in 4 states and Harmon operated 40 stores in 3 states (1 of which was opened during the fiscal third quarter) under the names Harmon and Harmon Face Values. In addition, Christmas Tree Shops operated 39 stores in 10 states (3 of which were opened during the fiscal third quarter). Consolidated store space as of December 1, 2007 was approximately 29.5 million square feet. Since the beginning of the fiscal fourth quarter on December 2, 2007, 2 additional Bed Bath & Beyond stores, including the Company's first store in Canada, have been opened.
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. The Company sells a wide assortment of merchandise principally including domestics merchandise and home furnishings as well as food, giftware, health and beauty care items and infant and toddler merchandise. 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, estimate, assume, continue, 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: changes in the retailing environment and 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; general economic conditions; unusual weather patterns; competition from existing and potential competitors; competition from other channels of distribution; pricing pressures; 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; and matters arising out of or related to the Company's stock option grants and procedures and related matters, including the outcome of the informal inquiry commenced by the SEC, the possibility that the SEC may not agree with all of the special committee's findings and recommendations and may require additional or different remediation, any other proceedings which may be brought against the Company by the SEC or other governmental agencies, any tax implications relating to the Company's stock option grants, the outcome of the shareholder derivative actions filed against certain of the Company's officers and directors, and the possibility of other private litigation relating to such stock option grants and related matters. The Company does not undertake any obligation to update its forward-looking statements.
The United States Attorney's Office for the District of New Jersey has
concluded its inquiry with respect to matters arising out of and related to
the Company's historical stock option grants and procedures and related
matters and has indicated it will take no further action related to this
matter.
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
December 1, November 25, December 1, November 25,
2007 2006 2007 2006
Net sales $1,794,747 $1,619,240 $5,115,756 $4,622,442
Cost of sales 1,046,881 915,167 2,989,623 2,650,022
Gross profit 747,866 704,073 2,126,133 1,972,420
Selling, general and
administrative
expenses 544,714 492,939 1,547,553 1,392,914
Operating profit 203,152 211,134 578,580 579,506
Interest income 4,968 10,643 21,575 30,230
Earnings before
provision for
income taxes 208,120 221,777 600,155 609,736
Provision for
income taxes 69,888 79,341 210,268 221,334
Net earnings $138,232 $142,436 $389,887 $388,402
Net earnings per
share - Basic $0.53 $0.51 $1.46 $1.38
Net earnings per
share - Diluted $0.52 $0.50 $1.44 $1.36
Weighted average shares
outstanding - Basic 261,588 281,097 267,074 280,629
Weighted average shares
outstanding - Diluted 265,006 285,664 270,929 285,112
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, unaudited)
December 1, November 25,
2007 2006 (1)
Assets
Current assets:
Cash and cash equivalents $190,433 $300,324
Short term investment securities 186,797 517,230
Merchandise inventories 1,797,784 1,639,355
Other current assets 314,800 203,582
Total current assets 2,489,814 2,660,491
Long term investment securities 128 232,820
Property and equipment, net 1,064,081 878,006
Other assets 309,869 217,611
$3,863,892 $3,988,928
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $680,716 $668,727
Accrued expenses and other current
liabilities 263,231 262,464
Merchandise credit and gift card liabilities 156,789 125,385
Current income taxes payable 15,668 70,635
Total current liabilities 1,116,404 1,127,211
Deferred rent and other liabilities 187,588 167,736
Income taxes payable 86,365 -
Total liabilities 1,390,357 1,294,947
Total shareholders' equity 2,473,535 2,693,981
$3,863,892 $3,988,928
(1) Restated for the implementation of Staff Accounting Bulletin No. 108.
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands, unaudited)
Nine Months Ended
December 1, November 25,
2007 2006
Cash Flows from Operating Activities:
Net earnings $389,887 $388,402
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation 116,284 95,634
Amortization of bond premium 1,446 2,774
Stock-based compensation 31,233 43,085
Excess tax benefit from stock-based
compensation 1,363 3,773
Deferred income taxes (6,936) (28,664)
(Increase) decrease in assets, net of
effect of acquisition:
Merchandise inventories (277,476) (337,635)
Trading investment securities (2,705) (2,295)
Other current assets (85,067) (80,251)
Other assets 435 (323)
Increase (decrease) in liabilities, net
of effect of acquisition:
Accounts payable 76,197 135,506
Accrued expenses and other
current liabilities 26,301 19,976
Merchandise credit and gift card liabilities 9,512 11,871
Income taxes payable (61,384) (56,142)
Deferred rent and other liabilities 20,847 22,004
Net cash provided by operating activities 239,937 217,715
Cash Flows from Investing Activities:
Purchase of held-to-maturity
investment securities - (124,125)
Redemption of held-to-maturity
investment securities 366,232 212,586
Purchase of available-for-sale
investment securities (841,805) (824,830)
Redemption of available-for-sale
investment securities 1,167,480 783,815
Capital expenditures (257,054) (235,187)
Payment for acquisition, net of
cash acquired (85,893) -
Net cash provided by (used in)
investing activities 348,960 (187,741)
Cash Flows from Financing Activities:
Proceeds from exercise of stock options 15,741 23,701
Excess tax benefit from stock-based
compensation 4,109 6,607
Repurchase of common stock, including fees (631,695) (988)
Payment of deferred purchase price
for acquisition - (6,667)
Net cash (used in) provided by
financing activities (611,845) 22,653
Net (decrease) increase in cash and
cash equivalents (22,948) 52,627
Cash and cash equivalents:
Beginning of period 213,381 247,697
End of period $190,433 $300,324
SOURCE Bed Bath & Beyond Inc.
CONTACT:
Investors: Ronald Curwin, +1-908-688-0888, ext. 4550
or
Kenneth C. Frankel, +1-908-688-0888, ext. 4554
or
Lisa S. Kaplowitz, +1-908-688-0888, ext. 4083
all for Bed Bath & Beyond Inc.
Web site: http://www.bedbath.com