Bed Bath & Beyond earnings reveal struggles with closures, finding a new CEO, and more…
Bed Bath & Beyond posted its second-quarter earnings results on Tuesday. The company revealed better-than-expected earnings … But it missed Wall Street expectations on same-store sales and revenue.
The company is struggling in 2019 as it continues to close stores and tries to get rid of surplus inventory. Investors have lost a lot of confidence in the stock. BBBY has dropped 28% in the last year.
“Our second-quarter financial results reflect the relentless effort of our teams and our progress in driving the Company’s transformation efforts to delight our customers, enhance our competitive position, improve our financial performance, and drive shareholder value,” interim CEO Mary A. Winston said of the results.
Bed Bath & Beyond shares fell by about 2% in after-hours trading.
Here are the key points from Bed Bath & Beyond’s Q2 earnings release:
- Earnings per share: 34 cents
- Same-store sales: down 6.7%
- Revenue: $2.72 billion
Winston remains upbeat on the report: “We are making good progress against our four key near-term priorities.”
Those priorities include BBBY’s sales and growth, cost structure, asset base, and organization structure.
The company also said it expects its fiscal 2019 full-year net sales to be about $11.4 billion. Its net earnings should fall between $2.08 and $2.13. These estimates are in line with Bed Bath & Beyond’s most recent 2019 forecast.
Bed Bath & Beyond’s board of directors also declared a cash dividend of 17 cents per share. The dividend is payable as of January 14, 2020, to shareholders of record at the close of business on December 13, 2019.
The company also mentioned that it repurchased approximately 1.4 million shares of its common stock at $16.5 million.
Search for a New CEO
Earlier this year, Bed Bath & Beyond CEO Steven Temares stepped down from his position. The company continues to search for a new executive to fill his place.
Regarding a search for a new CEO, the company said it “has made substantial progress toward identifying a permanent CEO.” BBBY hopes to make that big announcement soon.
In an earnings call, the company said it will likely close 60 stores by the end of fiscal 2019. That includes 40 Bed Bath & Beyond stores and 20 subsidiary stores.
“With this action we are increasing the profitability of our remaining portfolio, and believe that our remaining fleet will benefit from our renewed focus on driving traffic and operating efficiency,” said Winson regarding the announcement.
Bed Bath & Beyond is determined to turn things around. The company is set on focusing on increasing sales and reevaluating its cost structure. But it’s also adjusting its organization structure and reviewing its asset portfolio.
There are also plans to sell off certain assets, such as Buy Buy Baby and Cost Plus World Market. All of the company’s non-core and real estate assets are estimated to be worth approximately $1.7 billion.
While many investors are down on the company so far this year, some optimism seems to be returning … WedBush recently upgraded the company from neutral to outperform. This earnings release may have been a mixed bag, but Bed Bath & Beyond seems set on moving in a better direction.