News Release

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Bed Bath & Beyond Inc. Announces Second Quarter Results
Sep 25 2001

UNION, N.J., Sept. 25 /PRNewswire/ -- Bed Bath & Beyond Inc. (Nasdaq: BBBY) today reported that in the fiscal second quarter (thirteen weeks) ended September 1, 2001, as compared with the fiscal second quarter (thirteen weeks) ended August 26, 2000, net earnings increased by 23.8% and net earnings per share grew to $.18 from $.15, on an increase in net sales of 21.1%.

Net earnings for the fiscal second quarter of 2001 were $54.0 million, compared with $43.6 million earned in the fiscal second quarter of the prior year. Net sales for the second quarter were $713.6 million compared to net sales of $589.4 million achieved in the corresponding quarter of the prior year. Comparable store sales for the fiscal second quarter increased by approximately 4.8%.

For the fiscal first half (twenty-six weeks) ended September 1, 2001, net earnings increased 25.4% to $84.0 million ($.28 per share) from $66.9 million ($.23 per share) earned in the comparable period (twenty-six weeks) of the prior year. Net sales for the fiscal six months rose 23.0% to $1.3 billion from $1.0 billion for the corresponding period of the prior year. Comparable stores sales for the fiscal first half increased by approximately 4.6%.

Per share amounts have been adjusted to reflect the two-for-one stock split of the Company's common stock on August 11, 2000 (which was effected in the form of a 100% stock dividend).

Total store space as of the end of the fiscal second quarter, during which 22 new stores were opened, grew to approximately 13,159,000 square feet, an increase of approximately 21.8% over total store space of approximately 10,808,000 square feet at the end of the fiscal first half a year ago.

As of September 1, 2001, Bed Bath & Beyond Inc. operated 344 stores. Since that date, the Company has opened 15 additional stores bringing to 359 stores in 44 states the total number of stores now in operation. Including these stores, the Company has opened 48 new stores, including its first unit in New Hampshire, since the beginning of its fiscal year.

The Company plans to open approximately 32 additional stores, in both new and existing markets, during the remainder of the current fiscal year, and expects to be operating approximately 391 stores in 44 states and one U.S. territory at year end. This includes a store in Puerto Rico, the Company's first store outside the Continental U.S., expected to open after Thanksgiving.

Bed Bath & Beyond Inc. is a nationwide chain of superstores selling better quality domestics merchandise and home furnishings. Its stock is traded on Nasdaq under the symbol "BBBY" and is included in the Standard & Poor's 500 Index and the NASDAQ-100 Index.

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: general economic conditions, changes in the retailing environment and consumer 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 the existing and potential competitors; competition from other channels of distribution; pricing pressures; the ability to find suitable locations at reasonable occupancy costs to support the Company's expansion program; and the cost of labor, merchandise and other costs and expenses. The Company does not undertake any obligation to update its forward-looking statements.

                     Consolidated Statements of Earnings
                    (in thousands, except per share data)

                           Three Months Ended            Six Months Ended

                        September 1,   August 26,   September 1,   August 26,
                              2001        2000          2001          2000

    Net sales             $713,636      $589,381   $1,289,469    $1,048,544
    Cost of sales,
     including buying,
     occupancy and
     indirect costs        422,294       348,097      763,168       619,967
    Gross profit           291,342       241,284      526,301       428,577
    Selling, general
     and administrative
     expenses              206,670       171,275      396,027       322,229
    Operating profit        84,672        70,009      130,274       106,348
    Interest income          3,058         1,431        6,248         3,393
    Earnings before
     provision for
     income taxes           87,730        71,440      136,522       109,741
    Provision for
     income taxes           33,776        27,862       52,561        42,799
    Net earnings           $53,954       $43,578      $83,961       $66,942
    Net earnings
     per share - Basic       $0.19         $0.15        $0.29         $0.24
    Net earnings
     per share - Diluted     $0.18         $0.15        $0.28         $0.23

Weighted average

shares outstanding

- Basic 289,791 282,872 289,129 282,298

Weighted average

shares outstanding

     - Diluted             298,816       291,363      298,148       290,661

                         Consolidated Balance Sheets
                          (in thousands, unaudited)

                                                 September 1,     August 26,
                                                      2001           2000

    Current assets:
    Cash and cash equivalents                       $338,770       $147,700
    Merchandise inventories                          733,157        594,602
    Prepaid expenses and other current assets         46,403         38,635

    Total current assets                           1,118,330        780,937

    Property and equipment, net                      322,706        245,686
    Other assets                                       7,691         10,904

                                                  $1,448,727     $1,037,527

    Liabilities and Shareholders' Equity

    Current liabilities:
    Accounts payable                                $296,166       $214,250
    Accrued expenses and other current liabilities   156,815        120,974
    Income taxes payable                              31,649         32,074

    Total current liabilities                        484,630        367,298

    Deferred rent and other liabilities               30,415         21,616

    Total liabilities                                515,045        388,914

    Total shareholders' equity                       933,682        648,613

                                                  $1,448,727     $1,037,527

                    Consolidated Statements of Cash Flows
                          (in thousands, unaudited)

                                                       Six Months Ended

                                                  September 1,     August 26,
                                                        2001           2000

    Cash Flows from Operating Activities:

    Net earnings                                     $83,961        $66,942
    Adjustments to reconcile net earnings
     to net cash provided by operating activities:
    Depreciation and amortization                     29,729         20,691
    Tax benefit from exercise of stock options        18,856         13,312
    Deferred income taxes                              (363)        (3,865)
    Increase in assets:
    Merchandise inventories                        (126,453)      (124,169)
    Prepaid expenses and other current assets        (3,112)        (2,360)
    Other assets                                       (335)          (889)
    Increase (decrease) in liabilities:
    Accounts payable                                 103,765         69,136
    Accrued expenses and other current liabilities    28,015         12,895
    Income taxes payable                               (339)        (1,516)
    Deferred rent                                      1,650          1,644

    Net cash provided by operating activities        135,374         51,821

    Cash Flows from Investing Activities:

    Capital expenditures                            (49,779)       (57,466)

    Net cash used in investing activities           (49,779)       (57,466)

    Cash Flows from Financing Activities:

    Proceeds from exercise of stock options           13,847          9,314

    Net cash provided by financing activities         13,847          9,314

    Net increase in cash and cash equivalents         99,442          3,669

    Cash and cash equivalents:
    Beginning of period                              239,328        144,031
    End of period                                   $338,770       $147,700

SOURCE Bed Bath & Beyond Inc.

CONTACT: Investors - Ronald Curwin, Chief Financial Officer and Treasurer, ext. 4550, Kenneth C. Frankel, Director of Financial Planning, ext. 4554, or Paula J. Marbach, Investor Relations, ext. 4552, fax, +1-908-810-8813, all of Bed Bath & Beyond Inc./