Shoppers exit a Bed Bath & Beyond store in New York.
Michael Nagle | Bloomberg | Getty Images
The company said that despite widespread, temporary store closures, it still has the financial flexibility to make key investments in e-commerce and strengthen its ability to offer shoppers the option to buy products online and pick them up at stores.
“The duration and extent of the pandemic is highly uncertain, and Bed Bath & Beyond’s results could be impacted in ways that are difficult to predict today,” it said, in its earnings release.
Bed Bath & Beyond shares jumped roughly 13% in after-hours trading. The stock had closed the day down more than 17%. The company has a market cap of about $563.7 million.
Here’s how Bed Bath & Beyond did, for the quarter ended Feb. 29:
- Earnings per share: 38 cents, adjusted
- Revenue: $3.1 billion
- Same-store sales: down 5.6%
The retailer reported a net loss of $65 million, or 53 cents per share, in the quarter, compared with a loss of $254 million, or $1.92 a share, a year ago.
Excluding one time items, the company earned 38 cents per share, better than the 20 cents analyst were expecting, based on Refinitiv consensus estimates.
Revenue dropped 6% to $3.1 billion, slightly better than the $3.07 billion analysts were anticipating.
Overall same-store sales were down 5.6% during the holiday period. Sales at its bricks-and-mortar stores open for at least 12 months dropped 10%, while online sales jumped 16%, it said.
Social distancing restrictions in the U.S. did not begin to shut many retailers’ stores until the middle of March, which was after Bed Bath & Beyond’s fourth quarter ended. All of Bed Bath & Beyond’s stores, other than Buybuy Baby and Harmon Face Values stores, have been temporarily shut until May 2, to try to help curb the spread of the virus.
Taking preventative measures, the retailer said Wednesday that it plans to cut back discretionary expenses like business travel and advertising, and costs related to the maintenance of stores that are sitting dark. It said it has postponed about $150 million in planned expenses that included some store remodeling.
It said it will be prioritizing roughly $250 million in essential expenditures in its digital business and rolling out more in-store pick-up options, instead.
Meantime, it plans to convert roughly 25% of its Bed Bath & Beyond and Buybuy Baby stores in the U.S. and Canada into temporary, regional fulfillment centers to make faster deliveries, during the crisis. Stuck at home, more people have been turning to Bed Bath & Beyond’s website to buy items like coffee makers, bread makers and vacuums, CEO Mark Tritton said during a call with analysts.
The company has suspended plans to spend as much as $600 million in 2020 on share repurchases, future dividend payments and debt reduction.
Bed Bath & Beyond also said it is working with its landlords to renegotiate rent payments. Tritton said the retailer has as many as 250 leases coming up for renewal in 2020, alone, giving the company ample flexibility with its real estate.