- Net Earnings for Quarter of $.46 per Diluted Share
- Quarterly Net Sales Increase by 4.9%
- Quarterly Comparable Store Sales Decrease by 0.1%
UNION, N.J., Sept. 24 /PRNewswire-FirstCall/ -- Bed Bath & Beyond Inc. (Nasdaq: BBBY) today reported net earnings of $.46 per diluted share ($119.3 million) in the fiscal second quarter ended August 30, 2008, compared with net earnings of $.55 per diluted share ($147.0 million) in the same quarter a year ago. Net sales for the fiscal second quarter of 2008 were approximately $1.854 billion, an increase of approximately 4.9% from net sales of approximately $1.768 billion reported in the fiscal second quarter of 2007. Comparable store sales in the fiscal second quarter of 2008 decreased by approximately 0.1%, compared with an increase of approximately 2.2% in last year's fiscal second quarter.
For the fiscal first half ended August 30, 2008, the Company reported net earnings of $.76 per diluted share ($196.0 million) compared with net earnings of $.92 per diluted share ($251.7 million) in the corresponding period a year ago. Net sales for the fiscal first half of 2008 were approximately $3.502 billion, an increase of approximately 5.5% from net sales of approximately $3.321 billion in the corresponding period a year ago. Comparable store sales for the fiscal first half of 2008 increased by approximately 0.3%, compared with an increase of approximately 1.9% in last year's fiscal first half.
As of August 30, 2008, the Company had a total of 994 stores, including 903 Bed Bath & Beyond stores (13 of which were opened during the fiscal second quarter, including a second store in Canada) in 49 states, the District of Columbia, Puerto Rico and Canada, 41 Christmas Tree Shops stores, 10 buybuy BABY stores, and 40 stores under the names of Harmon or Harmon Face Values. Consolidated store space as of August 30, 2008 was approximately 30.8 million square feet. Since the beginning of the fiscal third quarter on August 31, 2008, 4 additional Bed Bath & Beyond stores and 1 additional Christmas Tree Shops store have been opened. In addition, through a joint venture, the Company operates 2 stores in Mexico 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. 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: general economic conditions including the housing market and fuel costs; 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; 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; the impact of failed auctions for auction rate securities held by the Company; 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 a shareholder derivative action filed against certain of the Company's officers and directors and related matters, 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.
(Tables Follow)
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(in thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
August 30, September 1, August 30, September 1,
2008 2007 2008 2007
Net sales $1,853,892 $1,767,716 $3,502,383 $3,321,009
Cost of sales 1,114,571 1,035,558 2,107,062 1,942,742
Gross profit 739,321 732,158 1,395,321 1,378,267
Selling,
general and
administrative
expenses 551,900 511,121 1,089,081 1,002,839
Operating
profit 187,421 221,037 306,240 375,428
Interest
income 2,946 6,717 7,476 16,607
Earnings before
provision for
income taxes 190,367 227,754 313,716 392,035
Provision for
income taxes 71,099 80,746 117,671 140,380
Net earnings $ 119,268 $ 147,008 $ 196,045 $ 251,655
Net earnings
per
share - Basic $ 0.46 $0.55 $ 0.76 $ 0.93
Net earnings
per
share -
Diluted $ 0.46 $ 0.55 $ 0.76 $ 0.92
Weighted average
shares
outstanding
- Basic 256,726 266,069 256,680 269,817
Weighted
average
shares
outstanding
- Diluted 258,979 269,531 259,121 273,890
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, unaudited)
August 30, September 1,
2008 2007
Assets
Current assets:
Cash and cash equivalents $ 288,556 $ 122,963
Short term investment securities 10,000 460,771
Merchandise inventories 1,810,313 1,602,677
Other current assets 282,771 288,621
Total current assets 2,391,640 2,475,032
Long term investment securities 286,946 32,152
Property and equipment, net 1,123,651 994,344
Other assets 330,104 316,203
$4,132,341 $3,817,731
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 654,626 $ 649,052
Accrued expenses and other
current liabilities 255,422 255,904
Merchandise credit and
gift card liabilities 170,331 151,557
Current income taxes payable 11,131 49,518
Total current liabilities 1,091,510 1,106,031
Deferred rent and other liabilities 205,644 175,107
Income taxes payable 77,449 115,926
Total liabilities 1,374,603 1,397,064
Total shareholders' equity 2,757,738 2,420,667
$4,132,341 $3,817,731
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands, unaudited)
Six Months Ended
August 30, September 1,
2008 2007
Cash Flows from
Operating Activities:
Net earnings $ 196,045 $ 251,655
Adjustments to reconcile net
earnings to net cash
provided by operating
activities:
Depreciation 87,138 75,177
Amortization of bond premium - 1,123
Stock-based compensation 21,604 20,562
Tax benefit from stock-based
compensation 266 470
Deferred income taxes (17,565) (30,227)
Other 155 -
Increase in assets, net of
effect of acquisition:
Merchandise inventories (193,332) (82,369)
Trading investment
securities (1,740) (2,117)
Other current assets (34,906) (31,180)
Other assets (928) (312)
Increase (decrease) in
liabilities, net of effect
of acquisition:
Accounts payable 102,476 51,824
Accrued expenses and other
current liabilities (2,907) 8,556
Merchandise credit and
gift card liabilities (921) 4,280
Income taxes payable (61) 2,027
Deferred rent and other
liabilities 12,725 8,437
Net cash provided by
operating activities 168,049 277,906
Cash Flows from Investing
Activities:
Redemption of held-to-maturity
investment securities - 188,669
Purchase of available-for-sale
investment securities - (644,330)
Redemption of available-for-sale
investment securities 31,350 841,305
Capital expenditures (106,711) (153,296)
Investment in unconsolidated
joint venture, including fees (4,764) -
Payment for acquisition, net
of cash acquired - (85,893)
Net cash (used in) provided
by investing activities (80,125) 146,455
Cash Flows from Financing
Activities:
Proceeds from exercise of
stock options 12,779 10,576
Excess tax benefit from
stock-based compensation 4,394 2,971
Repurchase of common stock,
including fees (40,625) (528,326)
Net cash used in financing
activities (23,452) (514,779)
Net increase (decrease)
in cash and cash equivalents 64,472 (90,418)
Cash and cash equivalents:
Beginning of period 224,084 213,381
End of period $ 288,556 $ 122,963
SOURCE Bed Bath & Beyond Inc.
CONTACT:
Ronald Curwin, +1-908-855-4550
or
Kenneth C. Frankel, +1-908-855-4554
or
Lisa S. Kaplowitz, +1-908-855-4083