News Release

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Bed Bath & Beyond Inc. Reports Results For Fiscal Second Quarter
Sep 23 2009
- Net Earnings per Diluted Share Increase 13.0% to $.52

UNION, N.J., Sept. 23 /PRNewswire-FirstCall/ -- Bed Bath & Beyond Inc. today reported net earnings of $.52 per diluted share ($135.5 million) in the fiscal second quarter ended August 29, 2009, an increase of approximately 13.0% over net earnings of $.46 per diluted share ($119.3 million) in the same quarter a year ago. Net sales for the fiscal second quarter of 2009 were approximately $1.915 billion, an increase of approximately 3.3% from net sales of approximately $1.854 billion reported in the fiscal second quarter of 2008. Comparable store sales in the fiscal second quarter of 2009 decreased by approximately 0.6%.

For the fiscal first half ended August 29, 2009, the Company reported net earnings of $.86 per diluted share ($222.7 million), an increase of approximately 13.2% over net earnings of $.76 per diluted share ($196.0 million) in the corresponding period a year ago. Net sales for the fiscal first half of 2009 were approximately $3.609 billion, an increase of approximately 3.1% from net sales of approximately $3.502 billion in the corresponding period a year ago. Comparable store sales for the fiscal first half of 2009 decreased by approximately 1.1%.

As of August 29, 2009, the Company had a total of 1,056 stores, including 943 Bed Bath & Beyond stores in 49 states, the District of Columbia, Puerto Rico and Canada, 53 Christmas Tree Shops stores, 19 buybuy BABY stores, and 41 stores under the names of Harmon or Harmon Face Values. During the fiscal second quarter, the Company opened nine Bed Bath & Beyond stores, three buybuy BABY stores and one Harmon Face Values store and closed one Bed Bath & Beyond store. Consolidated store space as of August 29, 2009 was approximately 32.5 million square feet. Since the beginning of the fiscal third quarter on August 30, 2009, three additional Bed Bath & Beyond stores and three additional buybuy BABY stores have been opened. In addition, through a joint venture, the Company 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. Through a joint venture, the Company also operates retail stores in Mexico under the name "Home & More." 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, fuel costs and a declining overall macroeconomic environment; 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 any tax implications relating to the Company's stock option grants. The Company does not undertake any obligation to update its forward-looking statements.

                          BED BATH & BEYOND INC. AND SUBSIDIARIES
                            Consolidated Statements of Earnings
                           (in thousands, except per share data)
                                        (unaudited)

                             Three Months Ended          Six Months Ended
                           August 29,   August 30,     August 29,   August 30,
                             2009         2008           2009         2008

    Net sales             $1,914,909   $1,853,892     $3,609,249   $3,502,383
    Cost of sales          1,141,516    1,114,571      2,169,038    2,107,062
      Gross profit           773,393      739,321      1,440,211    1,395,321
    Selling, general and
     administrative
     expenses                551,362      551,900      1,075,876    1,089,081
      Operating profit       222,031      187,421        364,335      306,240
    Interest income            1,476        2,946          3,243        7,476
      Earnings before
       provision for
       income taxes          223,507      190,367        367,578      313,716
    Provision for income
     taxes                    87,976       71,099        144,875      117,671
      Net earnings          $135,531     $119,268       $222,703     $196,045

    Net earnings per share
     - Basic                   $0.53        $0.46          $0.87        $0.76
    Net earnings per share
     - Diluted                 $0.52        $0.46          $0.86        $0.76

    Weighted average shares
     outstanding - Basic     257,814      256,726        257,378      256,680
    Weighted average shares
     outstanding - Diluted   259,940      258,979        259,352      259,121


                      BED BATH & BEYOND INC. AND SUBSIDIARIES
                          Consolidated Balance Sheets
                           (in thousands, unaudited)

                                           August 29,       August 30,
                                              2009             2008
    Assets

    Current assets:
      Cash and cash equivalents            $1,035,601         $288,556
      Short term investment securities         43,125           10,000
      Merchandise inventories               1,755,377        1,810,313
      Other current assets                    289,101          282,771

        Total current assets                3,123,204        2,391,640

    Long term investment securities           157,193          286,946
    Property and equipment, net             1,111,971        1,123,651
    Other assets                              343,070          330,104

                                           $4,735,438       $4,132,341

    Liabilities and Shareholders' Equity

    Current liabilities:
      Accounts payable                       $682,936         $654,626
      Accrued expenses and other current
       liabilities                            264,066          255,422
      Merchandise credit and gift card
       liabilities                            163,338          170,331
      Current income taxes payable             29,159           11,131

        Total current liabilities           1,139,499        1,091,510

    Deferred rent and other liabilities       236,107          205,644
    Income taxes payable                       98,928           77,449

        Total liabilities                   1,474,534        1,374,603

    Total shareholders' equity              3,260,904        2,757,738

                                           $4,735,438       $4,132,341


                       BED BATH & BEYOND INC. AND SUBSIDIARIES
                        Consolidated Statements of Cash Flows
                              (in thousands, unaudited)

                                                 Six Months Ended
                                            August 29,       August 30,
                                               2009             2008
    Cash Flows from Operating Activities:

    Net earnings                             $222,703         $196,045
    Adjustments to reconcile net
     earnings to net cash
     provided by operating activities:
      Depreciation                             89,746           87,138
      Stock-based compensation                 22,137           21,604
      Tax benefit from stock-based
       compensation                              (964)             266
      Deferred income taxes                   (13,943)         (17,565)
      Other                                       (12)             155
      (Increase) decrease in assets:
        Merchandise inventories              (113,038)        (193,332)
        Trading investment securities          (4,071)          (1,740)
        Other current assets                  (32,756)         (34,906)
        Other assets                              302             (928)
      Increase (decrease) in liabilities:
        Accounts payable                      183,176          102,476
        Accrued expenses and other current
         liabilities                           19,123           (2,907)
        Merchandise credit and gift card
         liabilities                           (2,283)            (921)
        Income taxes payable                   11,318              (61)
        Deferred rent and other liabilities    10,968           12,725

    Net cash provided by operating
     activities                               392,406          168,049

    Cash Flows from Investing Activities:

     Redemption of available-for-sale
      investment securities                    27,245           31,350
     Capital expenditures                     (67,631)        (106,711)
     Investment in unconsolidated joint
      venture, including fees                       -           (4,764)

     Net cash used in investing activities    (40,386)         (80,125)

    Cash Flows from Financing Activities:

     Proceeds from exercise of stock options   45,663           12,779
     Excess tax benefit from stock-based
      compensation                              2,778            4,394
     Repurchase of common stock,
      including fees                          (33,069)         (40,625)

     Net cash provided by (used in)
      financing activities                     15,372          (23,452)

     Net increase in cash and cash
      equivalents                             367,392           64,472

    Cash and cash equivalents:
     Beginning of period                      668,209          224,084
     End of period                         $1,035,601         $288,556

SOURCE Bed Bath & Beyond Inc.

Kenneth C. Frankel, +1-908-855-4554 or Lisa S. Kaplowitz, +1-908-855-4083