UNION, N.J., Dec 15, 2004 /PRNewswire-FirstCall via COMTEX/ -- Bed Bath & Beyond Inc. today reported net earnings of $121.9 million ($.40 per share) in the fiscal third quarter ended November 27, 2004, an increase of approximately 21.3% from the $100.5 million ($.33 per share) earned in the fiscal third quarter of 2003. Net sales for the fiscal third quarter of 2004 were approximately $1.3 billion, an increase of approximately 11.1% from net sales of approximately $1.2 billion in the fiscal third quarter of 2003. Comparable store sales for the fiscal third quarter of 2004 grew by approximately 3.1%.
For the fiscal nine months ended November 27, 2004, net earnings increased approximately 26.9% to $324.0 million ($1.06 per share) from $255.2 million ($.84 per share) earned in the comparable period of the prior year. Net sales for the fiscal nine months of 2004 rose approximately 15.7% to approximately $3.7 billion from approximately $3.2 billion in the corresponding period of the prior year. Comparable store sales for the fiscal nine months increased by approximately 4.2%.
Bed Bath & Beyond Inc. also announced today that its Board of Directors has approved a $350 million share repurchase program, which authorizes the Company to repurchase shares of its common stock in the open market at times and prices considered appropriate by the Company. The program is effective today, and is expected, depending upon prevailing market conditions, to be completed within approximately twelve months.
"Our Board took this action based upon our Company's continued strong financial condition and it reflects the Board's confidence in Bed Bath & Beyond's growth potential, financial outlook and excess cash flow generation," said Steven Temares, Chief Executive Officer and Member of the Board of Directors. "In addition to providing value to our shareholders through the $350 million share repurchase program, our strong operations should allow us to continue to invest in our infrastructure and maintain our flexibility to take advantage of opportunities, as they may arise."
The Company, which has been debt-free for over 8 years, had approximately $1.3 billion in cash, cash equivalents and investment securities as of November 27, 2004, which date is just prior to what has been historically the Company's most positive cash flow generation period of the year.
As of November 27, 2004, the Company operated a total of 698 stores, including 640 Bed Bath & Beyond stores (of which 34 were opened during the fiscal third quarter) in 44 states and Puerto Rico. In addition, as of that date, Christmas Tree Shops, Inc. (acquired in fiscal 2003) operated 26 stores in 7 states, (2 of which were opened during the fiscal third quarter), and Harmon Stores, Inc. (acquired in fiscal 2002) operated 32 stores in 3 states, (1 of which opened during the fiscal third quarter). Consolidated total store space as of November 27, 2004 was approximately 22.4 million square feet.
During the fiscal fourth quarter of 2004 the Company plans to open approximately 20 Bed Bath & Beyond stores, in both new and existing markets, and approximately 4 Harmon Stores. The additional openings will bring to approximately 85 the total number of new Bed Bath & Beyond stores opened in fiscal 2004 and to approximately 660 the number of Bed Bath & Beyond stores expected to be in operation at fiscal year-end. Including the planned fiscal fourth quarter openings, the total square feet of store space added to the core Bed Bath & Beyond chain will be approximately 10% greater than the total square feet of store space added during fiscal 2003, when 85 new Bed Bath & Beyond stores were opened. Also, as of February 26, 2005, there are expected to be in operation 26 Christmas Tree Shops and 36 Harmon Stores.
Bed Bath & Beyond Inc. is a nationwide chain of retail stores. The Company's Bed Bath & Beyond stores sell better quality domestics merchandise and home furnishings. The Company's Christmas Tree Shops and Harmon Stores sell giftware and household items and health and beauty care items, respectively. Shares of Bed Bath & Beyond Inc. are traded on NASDAQ under the symbol "BBBY" and are included in the Standard & Poor's 500 Index and the NASDAQ-100 Index. The Company is counted among the Fortune 500, the Forbes 500 and the Business Week 50.
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 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.
(Tables Follow)
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
November 27, November 29, November 27, November 29,
2004 2003 2004 2003
Net sales $1,305,155 $1,174,740 $3,680,032 $3,180,053
Cost of sales 757,003 687,753 2,144,277 1,866,741
Gross profit 548,152 486,987 1,535,755 1,313,312
Selling, general
and administrative
expenses 357,174 325,528 1,026,962 905,536
Operating profit 190,978 161,459 508,793 407,776
Interest income 4,889 1,965 11,663 7,219
Earnings before
provision for
income taxes 195,867 163,424 520,456 414,995
Provision for
income taxes 73,940 62,918 196,472 159,773
Net earnings $121,927 $100,506 $323,984 $255,222
Net earnings per
share - Basic $0.40 $0.34 $1.08 $0.86
Net earnings
per share - Diluted $0.40 $0.33 $1.06 $0.84
Weighted average
shares outstanding -
Basic 301,409 297,279 300,868 296,018
Weighted average
shares outstanding -
Diluted 307,557 305,156 306,878 304,122
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, unaudited)
November 27, November 29,
2004 2003
Assets
Current assets:
Cash and cash equivalents $781,922 $620,331
Short term investment securities 186,854 84,059
Merchandise inventories 1,213,785 1,167,808
Other current assets 125,639 94,825
Total current assets 2,308,200 1,967,023
Long term investment securities 331,556 133,876
Property and equipment, net 558,496 506,064
Goodwill 147,559 145,932
Other assets 21,148 26,166
$3,366,959 $2,779,061
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $518,817 $529,440
Accrued expenses and other
current liabilities 265,505 287,090
Merchandise credit and gift
card liabilities 73,442 52,957
Income taxes payable 27,259 27,315
Total current liabilities 885,023 896,802
Deferred rent and other liabilities 114,756 82,316
Total liabilities 999,779 979,118
Total shareholders' equity 2,367,180 1,799,943
$3,366,959 $2,779,061
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands, unaudited)
Nine Months Ended
November 27, November 29,
2004 2003
Cash Flows from Operating Activities:
Net earnings $323,984 $255,222
Adjustments to reconcile net earnings
to net cash provided by operating
activities:
Depreciation and amortization 69,957 60,686
Amortization of bond premium 988 1,079
Tax benefit from exercise of
stock options 24,898 43,691
Deferred income taxes 1,607 2,575
(Increase) decrease in assets,
net of effect of acquisition:
Merchandise inventories (201,451) (182,532)
Other current assets (30,417) (24,799)
Other assets 305 (6,998)
Increase (decrease) in liabilities,
net of effect of acquisition:
Accounts payable 120,167 150,131
Accrued expenses and other
current liabilities (1,823) 25,014
Merchandise credit and gift
card liabilities 10,254 8,775
Income taxes payable (6,586) (44,523)
Deferred rent and other liabilities 3,410 12,555
Net cash provided by operating activities 315,293 300,876
Cash Flows from Investing Activities:
Purchase of investment securities (400,578) (222,224)
Redemption of investment securities 133,548 252,770
Payment for acquisition, net of
cash acquired - (175,487)
Capital expenditures (112,167) (79,168)
Net cash used in investing activities (379,197) (224,109)
Cash Flows from Financing Activities:
Proceeds from exercise of stock options 27,478 49,109
Payment of deferred purchase price
for acquisition (6,667) -
Prepayment of acquired debt - (21,215)
Net cash provided by financing activities 20,811 27,894
Net (decrease) increase in cash
and cash equivalents (43,093) 104,661
Cash and cash equivalents:
Beginning of period 825,015 515,670
End of period $781,922 $620,331
SOURCE Bed Bath & Beyond Inc.
Ronald Curwin, Chief Financial Officer and Treasurer, Ext. 4550, or
Kenneth C. Frankel, Director of Financial Planning, Ext. 4554, or
Paula J. Marbach, Investor Relations, Ext. 4552,
All of Bed Bath & Beyond
Inc.,
+1-908-688-0888, or
Fax: +1-908-810-8813
http://www.bedbath.com