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Bed Bath & Beyond Inc. Reports Results for Fiscal Year (Fifty-Three Weeks) Ended March 3, 2007
Apr 11 2007
    * Earnings per Share of $.72 for Q4; $2.09 for Full Year,
      Including Q4 Non-Recurring $.07 Charge ($.79 for Q4; $2.15 for Full
      Year, Excluding Non-Recurring Charge)

    * Quarterly Comparable Store Sales Increase by 5.2%

    * 15th Consecutive Year of Record Earnings Since 1992 IPO

UNION, N.J., April 11 /PRNewswire-FirstCall/ -- Bed Bath & Beyond Inc. today reported net earnings of $.72 per diluted share, including the previously announced fourth quarter non-recurring charge relating to Internal Revenue Code Section 409A, which resulted in approximately $.07 per diluted share, in the fiscal fourth quarter (fourteen weeks) ended March 3, 2007. Excluding the non-recurring charge, net earnings were $.79 per diluted share in the fiscal fourth quarter of 2006, an increase of approximately 17.9% from the $.67 per diluted share earned in the fiscal fourth quarter of 2005 (thirteen weeks). Net sales for the fiscal fourth quarter (fourteen weeks) ended March 3, 2007 were approximately $1.995 billion, an increase of approximately 18.4% from the fiscal fourth quarter (thirteen weeks) of 2005. Comparable store sales for the fiscal fourth quarter of 2006 increased by approximately 5.2%, on top of an increase of approximately 6.3% in last year's fiscal fourth quarter.

Net earnings for the fiscal year (fifty-three weeks) ended March 3, 2007 were $2.09 per diluted share, including the non-recurring charge relating to Internal Revenue Code Section 409A of approximately $.07 per diluted share. Excluding the non-recurring charge, net earnings were $2.15 per diluted share for fiscal 2006, exceeding fiscal 2005 (fifty-two weeks) net earnings of $1.92 per diluted share by approximately 12.0%. Fiscal 2006 was the 15th consecutive year of record earnings since the Company's 1992 IPO. Net sales for fiscal 2006 (fifty-three weeks) were approximately $6.617 billion, an increase of approximately 13.9% from the prior fiscal year (fifty-two weeks). Comparable store sales for fiscal 2006 increased by approximately 4.9%, on top of an increase of approximately 4.6% in fiscal 2005. Comparable store sales percentage increases are calculated based on an equivalent number of weeks for each quarter and annual period.

Effective December 20, 2006, the Board of Directors of Bed Bath & Beyond Inc. approved a $1 billion share repurchase program which authorized the Company to purchase shares of its common stock. The Company intends to fund the program from present and expected future excess cash flows. Through the end of fiscal 2006 (March 3, 2007), the Company repurchased approximately 7.5 million shares for an aggregate cost of approximately $300 million.

During the fiscal fourth quarter, the Company incurred a previously announced non-recurring charge primarily resulting from payments made to over 1,600 employees, excluding senior management, to protect them from certain potential adverse tax consequences arising pursuant to Internal Revenue Code Section 409A. This non-recurring pre-tax charge in the fiscal fourth quarter of 2006 was approximately $30 million, equivalent to approximately $.07 per diluted share.

As of March 3, 2007, the Company operated a total of 888 stores, including 815 Bed Bath & Beyond stores (20 of which were opened during the fiscal fourth quarter, including the first store in the state of Alaska), in 48 states, the District of Columbia and Puerto Rico. In addition, as of March 3, 2007, Christmas Tree Shops, Inc. operated 34 stores in 8 states and Harmon Stores, Inc. operated 39 stores in 3 states (one of which was opened during the fiscal fourth quarter). Consolidated store space as of March 3, 2007 was approximately 27.8 million square feet.

On March 22, 2007, subsequent to the end of fiscal 2006, Bed Bath & Beyond Inc. completed and announced the acquisition of buybuy BABY, a retailer of infant and toddler merchandise. Since this acquisition occurred after the conclusion of fiscal 2006, it had no effect on Bed Bath & Beyond's fiscal 2006 results.

Since the beginning of the current fiscal year on March 4, 2007, 1 additional Bed Bath & Beyond store has been opened, and 2 existing stores were relocated. There are presently 816 Bed Bath & Beyond stores in operation, in 48 states, the District of Columbia and Puerto Rico. In addition, a new Christmas Tree Shops store was opened in March.

As previously disclosed, the Company continues to cooperate with the informal inquiry of the Securities and Exchange Commission and the inquiry of the United States Attorney's office for the District of New Jersey regarding the Company's stock option grant practices.

Bed Bath & Beyond Inc. and subsidiaries (the "Company") is a nationwide chain of retail stores, operating under the names of Bed Bath & Beyond, Christmas Tree Shops, Harmon 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 & 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 macro- economic 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 matters arising out of the inquiry commenced by the US Attorney for the District of New Jersey relating to the Company's stock option grants, 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.


    INVESTOR CONTACTS (at 908/688-0888):
    Ronald Curwin        Ext:  4550
    Kenneth C. Frankel   Ext:  4554
    Paula J. Marbach     Ext:  4552



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

                           Three Months Ended        Twelve Months Ended

                         March 3,   February 25,     March 3, February 25,
                           2007          2006         2007         2006
                       (unaudited)   (unaudited)  (unaudited)

    Net sales           $1,994,987   $1,685,279   $6,617,429   $5,809,562
    Cost of sales        1,132,005      937,459    3,782,027    3,323,814
        Gross profit       862,982      747,820    2,835,402    2,485,748
    Selling, general
     and administrative
     expenses              553,087      442,903    1,946,001    1,606,577
        Operating profit   309,895      304,917      889,401      879,171
    Interest income         13,248       11,252       43,478       35,920
        Earnings before
         provision for
         income taxes      323,143      316,169      932,879      915,091
    Provision for
     income taxes          117,301      118,247      338,635      342,244
        Net earnings      $205,842     $197,922     $594,244     $572,847
    Net earnings
     per share - Basic       $0.74        $0.68        $2.12        $1.95
    Net earnings
     per share - Diluted     $0.72        $0.67        $2.09        $1.92

    Weighted average
     shares outstanding -
     Basic                 279,079      289,683      280,199      293,899
    Weighted average
     shares outstanding -
     Diluted               284,431      294,401      284,956      298,973



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



                                                    March 3,     February 25,
                                                      2007          2006
                                                  (unaudited)
    Assets

    Current assets:
      Cash and cash equivalents                     $213,381       $247,697
      Short term investment securities               774,881        404,113
      Merchandise inventories                      1,505,800      1,301,720
      Other current assets                           204,552        118,415

        Total current assets                       2,698,614      2,071,945

    Long term investment securities                  102,692        393,862
    Property and equipment, net                      929,507        738,742
    Other assets                                     228,491        177,591

                                                  $3,959,304     $3,382,140

    Liabilities and Shareholders' Equity

    Current liabilities:
      Accounts payable                              $615,156       $534,910
      Accrued expenses and other current
       liabilities                                   245,267        249,092
      Merchandise credit and gift card liabilities   143,737        113,514
      Income taxes payable                           140,913         92,030

        Total current liabilities                  1,145,073        989,546

    Deferred rent and other liabilities              165,080        130,144

        Total liabilities                          1,310,153      1,119,690

    Total shareholders' equity                     2,649,151      2,262,450

                                                  $3,959,304     $3,382,140



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

                                                      Twelve Months Ended

                                                    March 3,    February 25,
                                                      2007           2006
                                                  (unaudited)
    Cash Flows from Operating Activities:

    Net earnings                                    $594,244       $572,847
    Adjustments to reconcile net earnings to
     net cash provided by operating activities:
      Depreciation                                   132,955        111,111
      Amortization of bond premium                     3,532          3,172
      Stock-based compensation                        52,596         26,439
      Excess tax benefit from stock-based
       compensation                                    6,691         20,011
      Deferred income taxes                          (56,191)       (25,874)
      Increase in assets:
        Merchandise inventories                     (204,080)      (149,692)
        Trading investment securities                 (2,958)          (423)
        Other current assets                         (38,241)       (23,543)
        Other assets                                    (695)          (307)
    Increase (decrease) in liabilities:
        Accounts payable                              75,883         64,892
        Accrued expenses and other current
         liabilities                                   9,784         (5,742)
        Merchandise credit and gift card liabilities  30,223         26,453
        Income taxes payable                          (9,459)        10,666
        Deferred rent and other liabilities           19,348         30,425

    Net cash provided by operating activities        613,632        660,435

    Cash Flows from Investing Activities:

      Purchase of held-to-maturity investment
       securities                                   (124,125)      (442,356)
      Redemption of held-to-maturity investment
       securities                                    309,818        331,565
      Purchase of available-for-sale investment
       securities                                 (1,443,115)    (1,524,835)
      Redemption of available-for-sale investment
       securities                                  1,177,250      1,788,450
      Capital expenditures                          (317,501)      (220,394)

      Net cash used in investing activities         (397,673)       (67,570)

    Cash Flows from Financing Activities:

      Proceeds from exercise of stock options         43,393         34,953
      Excess tax benefit from stock-based
       compensation                                   14,001          2,682
      Repurchase of common stock                    (301,002)      (598,244)
      Payment of deferred purchase price for
       acquisition                                    (6,667)        (6,667)

      Net cash used in financing activities         (250,275)      (567,276)

      Net (decrease) increase in cash and cash
       equivalents                                   (34,316)        25,589

    Cash and cash equivalents:
      Beginning of period                            247,697        222,108
      End of period                                 $213,381       $247,697
SOURCE  Bed Bath & Beyond Inc.
    -0-                             04/11/2007
    /CONTACT:  Investor - Ronald Curwin, x. 4550, Kenneth C. Frankel, x. 4554,
Paula J. Marbach, x. 4552, all of Bed Bath & Beyond Inc., +1-908-688-0888/
    /Web site:  http://www.bedbath.com/
    (BBBY)

CO:  Bed Bath & Beyond Inc.
ST:  New Jersey
IN:  REA FIN
SU:  ERN

BS-AA
-- NYW106 --
4227 04/11/2007 16:15 EDT http://www.prnewswire.com