Cover
Cover - USD ($) | 12 Months Ended | ||
Feb. 25, 2023 | May 09, 2023 | Aug. 27, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Feb. 25, 2023 | ||
Current Fiscal Year End Date | --02-25 | ||
Document Transition Report | false | ||
Entity File Number | 0-20214 | ||
Entity Registrant Name | BED BATH & BEYOND INC. | ||
Entity Incorporation, State or Country Code | NY | ||
Entity Tax Identification Number | 11-2250488 | ||
Entity Address, Address Line One | 650 Liberty Avenue | ||
Entity Address, City or Town | Union | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 07083 | ||
City Area Code | 908 | ||
Local Phone Number | 688-0888 | ||
Title of 12(b) Security | Common stock, $.01 par value | ||
Trading Symbol | BBBY | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Public Float | $ 848,397,597 | ||
Entity Common Stock, Shares Outstanding | 739,056,836 | ||
Entity Central Index Key | 0000886158 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Feb. 25, 2023 | |
Auditor Information [Abstract] | |
Auditor Name | KPMG LLP |
Auditor Location | New York, New York |
Auditor Firm ID | 185 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Feb. 25, 2023 | Feb. 26, 2022 |
Assets | ||
Cash and cash equivalents | $ 65,853 | $ 439,496 |
Restricted cash | 66,242 | 0 |
Merchandise inventories | 817,553 | 1,725,410 |
Prepaid expenses and other current assets | 147,261 | 198,248 |
Total current assets | 1,096,909 | 2,363,154 |
Long-term restricted cash | 15,262 | 31,388 |
Long-term investment securities | 0 | 19,212 |
Property and equipment, net | 50,143 | 1,027,387 |
Operating lease assets | 965,882 | 1,562,857 |
Other assets | 97,021 | 126,574 |
Total assets | 2,225,217 | 5,130,572 |
Current liabilities: | ||
Current portion of long-term debt | 646,005 | 0 |
Accounts payable | 457,924 | 872,445 |
Accrued expenses and other current liabilities | 244,432 | 529,371 |
Merchandise credit and gift card liabilities | 272,277 | 326,465 |
Current operating lease liabilities | 301,194 | 346,506 |
Preferred stock warrant liabilities | 404,441 | 0 |
Derivative liabilities | 169,611 | 0 |
Total current liabilities | 2,495,884 | 2,074,787 |
Other liabilities | 131,500 | 102,438 |
Operating lease liabilities | 1,278,467 | 1,508,002 |
Income taxes payable | 93,241 | 91,424 |
Long-term debt | 1,026,133 | 1,179,776 |
Total liabilities | 5,025,225 | 4,956,427 |
Mezzanine equity | ||
Convertible Preferred Stock, Series A, $0.001 par value, authorized - 1,000,000 shares authorized; issued 23,685 shares and outstanding 15,142 shares | 0 | 0 |
Shareholders' (deficit) equity: | ||
Preferred stock - $0.01 par value; authorized - 1,000 shares; no shares issued or outstanding | 0 | 0 |
Common stock - $0.01 par value; authorized - 900,000 shares; issued 382,353 and 344,146, respectively; outstanding 259,033 and 81,979 shares, respectively | 3,823 | 3,441 |
Additional paid-in capital | 2,428,439 | 2,235,894 |
Retained earnings | 225,058 | 9,666,091 |
Treasury stock, at cost; 123,320 and 262,167 shares, respectively | (5,457,379) | (11,685,267) |
Accumulated other comprehensive income (loss) | 51 | (46,014) |
Total shareholders' (deficit) equity | (2,800,008) | 174,145 |
Total liabilities, mezzanine equity, and shareholders' (deficit) equity | $ 2,225,217 | $ 5,130,572 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Feb. 25, 2023 | Feb. 26, 2022 |
Statement of Financial Position [Abstract] | ||
Convertible Preferred Stock, Series A, par value (in dollars per share) | $ 0.001 | |
Convertible Preferred Stock, Series A, shares authorized (in shares) | 1,000,000,000 | |
Convertible Preferred Stock, Series A, shares issued (in shares) | 23,685,000 | |
Convertible Preferred Stock, Series A, shares outstanding (in shares) | 15,142,000 | 0 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 |
Common stock, shares issued (in shares) | 382,353,000 | 344,146,000 |
Common stock, shares outstanding (in shares) | 259,033,000 | 81,979,000 |
Treasury stock (in shares) | 123,320,000 | 262,167,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Income Statement [Abstract] | |||
Net sales | $ 5,344,685 | $ 7,867,778 | $ 9,233,028 |
Cost of sales | 4,129,802 | 5,384,287 | 6,114,947 |
Gross profit | 1,214,883 | 2,483,491 | 3,118,081 |
Selling, general and administrative expenses | 2,372,969 | 2,692,292 | 3,224,363 |
Impairments | 1,287,529 | 36,531 | 127,341 |
Restructuring and transformation initiative expenses | 330,024 | 144,025 | 102,202 |
Loss on sale of businesses | 0 | 18,221 | 1,062 |
Operating loss | (2,775,639) | (407,578) | (336,887) |
Interest expense, net | 110,497 | 64,702 | 76,913 |
Loss on preferred stock warrants and derivative liabilities | 639,444 | 0 | 0 |
Loss on deconsolidation of subsidiaries | 98,633 | 0 | 0 |
Loss (gain) on extinguishment of debt | (94,343) | 376 | (77,038) |
Loss before provision (benefit) from income taxes | (3,529,870) | (472,656) | (336,762) |
Provision (benefit) from income taxes | (31,069) | 86,967 | (185,989) |
Net loss | $ (3,498,801) | $ (559,623) | $ (150,773) |
Net loss per share - Basic (in dollars per share) | $ (36.03) | $ (5.64) | $ (1.24) |
Net loss per share - Diluted (in dollars per share) | $ (36.03) | $ (5.64) | $ (1.24) |
Weighted average shares outstanding - Basic (in shares) | 97,106 | 99,249 | 121,446 |
Weighted average shares outstanding - Diluted (in shares) | 97,106 | 99,249 | 121,446 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (3,498,801) | $ (559,623) | $ (150,773) |
Other comprehensive (loss) income: | |||
Change in temporary impairment of auction rate securities, net of tax | 866 | (251) | (617) |
Pension adjustment, net of tax | 0 | (1,562) | (1,396) |
Reclassification adjustment on settlement of the pension plan, net of tax | 0 | 9,938 | 1,522 |
Currency translation adjustment | 45,199 | 1,461 | 9,800 |
Other comprehensive income | 46,065 | 9,586 | 9,309 |
Comprehensive loss | $ (3,452,736) | $ (550,037) | $ (141,464) |
Consolidated Statements of Mezz
Consolidated Statements of Mezzanine Equity and Shareholders' (Deficit) Equity - USD ($) $ in Thousands | Total | Preferred Stock Warrants | Common Stock Warrants | Restricted Stock Units | Performance Stock Units | Common Stock | Common Stock Restricted Stock Units | Common Stock Performance Stock Units | Additional Paid- in Capital | Additional Paid- in Capital Restricted Stock Units | Additional Paid- in Capital Performance Stock Units | Retained Earnings | Retained Earnings Preferred Stock Warrants | Retained Earnings Common Stock Warrants | Treasury Stock | Treasury Stock Preferred Stock Warrants | Treasury Stock Common Stock Warrants | Accumulated Other Comprehensive Loss |
Balance (in shares) at Feb. 29, 2020 | 343,683,000 | |||||||||||||||||
Balance at Feb. 29, 2020 | $ 1,764,935 | $ 3,436 | $ 2,167,337 | $ 10,374,826 | $ 10,715,755 | $ (64,909) | ||||||||||||
Treasury stock, balance (in shares) at Feb. 29, 2020 | (217,155,000) | |||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Net loss | (150,773) | (150,773) | ||||||||||||||||
Other comprehensive income, net of tax | 9,309 | 9,309 | ||||||||||||||||
Dividends forfeited | 1,200 | 1,200 | ||||||||||||||||
Forfeiture of restricted shares, net (in shares) | (786,000) | |||||||||||||||||
Forfeiture of restricted shares, net | 0 | $ (8) | 8 | |||||||||||||||
Payment and vesting of performance stock units (in shares) | 344,000 | |||||||||||||||||
Payment and vesting of performance stock units | 0 | $ 4 | (4) | |||||||||||||||
Stock-based compensation expense, net | 32,344 | 32,344 | ||||||||||||||||
Accelerated share repurchase program (in shares) | (15,833,000) | |||||||||||||||||
Accelerated share repurchase program | (375,000) | (47,550) | $ (327,450) | |||||||||||||||
Repurchase of common stock, including fees (in shares) | (632,000) | |||||||||||||||||
Repurchase of common stock, including fees | (5,079) | $ (5,079) | ||||||||||||||||
Balance (in shares) at Feb. 27, 2021 | 343,241,000 | |||||||||||||||||
Balance at Feb. 27, 2021 | $ 1,276,936 | $ 3,432 | 2,152,135 | 10,225,253 | $ 11,048,284 | (55,600) | ||||||||||||
Treasury stock, balance (in shares) at Feb. 27, 2021 | (233,620,000) | |||||||||||||||||
Ending balance (in shares) at Feb. 26, 2022 | 0 | |||||||||||||||||
Ending balance at Feb. 26, 2022 | $ 0 | |||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Net loss | (559,623) | (559,623) | ||||||||||||||||
Other comprehensive income, net of tax | 9,586 | 9,586 | ||||||||||||||||
Dividends forfeited | 461 | 461 | ||||||||||||||||
Issuance of restricted shares, net (in shares) | 624,000 | |||||||||||||||||
Issuance of restricted shares, net | 0 | $ 6 | (6) | |||||||||||||||
Payment and vesting of performance stock units (in shares) | 274,000 | |||||||||||||||||
Payment and vesting of performance stock units | 0 | $ 3 | (3) | |||||||||||||||
Stock-based compensation expense, net | 36,080 | 36,080 | ||||||||||||||||
Accelerated share repurchase program (in shares) | (200,000) | |||||||||||||||||
Accelerated share repurchase program | 0 | 47,550 | $ (47,550) | |||||||||||||||
Director fees paid in stock (in shares) | 7,000 | |||||||||||||||||
Director fees paid in stock | 138 | 138 | ||||||||||||||||
Repurchase of common stock, including fees (in shares) | (28,347,000) | |||||||||||||||||
Repurchase of common stock, including fees | $ (589,433) | $ (589,433) | ||||||||||||||||
Balance (in shares) at Feb. 26, 2022 | 81,979,000 | 344,146,000 | ||||||||||||||||
Balance at Feb. 26, 2022 | $ 174,145 | $ 3,441 | 2,235,894 | 9,666,091 | $ 11,685,267 | (46,014) | ||||||||||||
Treasury stock, balance (in shares) at Feb. 26, 2022 | (262,167,000) | (262,167,000) | ||||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||||||||||||
Issuance of Series A convertible preferred stock (in shares) | 23,685,000 | |||||||||||||||||
Conversion of Series A convertible Preferred Stock (in shares) | (13,543,000) | |||||||||||||||||
Exercise of Preferred Stock Warrants (in shares) | 5,000,000 | |||||||||||||||||
Ending balance (in shares) at Feb. 25, 2023 | 15,142,000 | |||||||||||||||||
Ending balance at Feb. 25, 2023 | $ 0 | |||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Net loss | (3,498,801) | (3,498,801) | ||||||||||||||||
Other comprehensive income, net of tax | 46,065 | 46,065 | ||||||||||||||||
Dividends forfeited | 235 | 235 | ||||||||||||||||
Issuance of restricted shares, net (in shares) | 178,000 | |||||||||||||||||
Issuance of restricted shares, net | 0 | $ 2 | (2) | |||||||||||||||
Payment and vesting of performance stock units (in shares) | 1,414,000 | 1,163,000 | 177,000 | |||||||||||||||
Payment and vesting of performance stock units | $ 0 | $ 0 | $ 12 | $ 2 | $ (12) | $ (2) | ||||||||||||
Stock-based compensation expense, net | 20,212 | 20,212 | ||||||||||||||||
Director fees paid in stock (in shares) | 11,000 | |||||||||||||||||
Director fees paid in stock | 145 | 145 | ||||||||||||||||
Issuance of common stock (in shares) | 36,678,000 | |||||||||||||||||
Issuance of common stock and At-the-Market offering, net of offering costs | 172,570 | $ 366 | 172,204 | |||||||||||||||
Repurchase of common stock, including fees (in shares) | (2,888,000) | |||||||||||||||||
Repurchase of common stock, including fees | $ (46,146) | $ (46,146) | ||||||||||||||||
Conversion of stock (in shares) | 13,543 | 70,911,000 | 70,824,000 | |||||||||||||||
Conversion of stock | $ 154,940 | $ 176,627 | $ (2,980,160) | $ (2,962,307) | $ 3,135,100 | $ 3,138,934 | ||||||||||||
Balance (in shares) at Feb. 25, 2023 | 259,033,000 | 382,353,000 | ||||||||||||||||
Balance at Feb. 25, 2023 | $ (2,800,008) | $ 3,823 | $ 2,428,439 | $ 225,058 | $ 5,457,379 | $ 51 | ||||||||||||
Treasury stock, balance (in shares) at Feb. 25, 2023 | (123,320,000) | (123,320,000) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Cash Flows from Operating Activities: | |||
Net loss | $ (3,498,801) | $ (559,623) | $ (150,773) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 427,087 | 293,626 | 340,912 |
Impairments | 1,287,529 | 36,531 | 127,341 |
Loss on preferred stock warrants and derivative liabilities | 639,444 | 0 | 0 |
Stock-based compensation | 19,394 | 35,061 | 31,594 |
Realized loss on available-for-sale investment securities | 1,411 | 0 | 0 |
Deferred income taxes | (37,586) | 125,711 | 148,741 |
Loss on sale of businesses | 0 | 18,221 | 1,062 |
Loss on deconsolidation of subsidiaries | 98,633 | 0 | 0 |
Loss (gain) on extinguishment of debt | (94,343) | 376 | (77,038) |
Other | 2,827 | (8,298) | (396) |
Decrease (increase) in assets: | |||
Merchandise inventories | 874,237 | (53,339) | 64,947 |
Other current assets | 46,453 | 387,746 | (387,172) |
Other assets | 11,355 | 607 | 1,519 |
Increase (decrease) in liabilities: | |||
Accounts payable | (365,772) | (132,785) | 168,556 |
Accrued expenses and other current liabilities | (262,530) | (100,356) | 15,538 |
Merchandise credit and gift card liabilities | (53,837) | 13,981 | (12,110) |
Income taxes payable | 2,300 | (11,257) | 54,958 |
Operating lease assets and liabilities, net | (86,785) | (14,162) | (32,813) |
Other liabilities | (1,995) | (14,186) | (26,758) |
Net cash (used in) provided by operating activities | (990,979) | 17,854 | 268,108 |
Cash Flows from Investing Activities: | |||
Purchases of held-to-maturity investment securities | 0 | (29,997) | 0 |
Redemption of held-to-maturity investment securities | 0 | 30,000 | 386,500 |
Proceeds from sale of available-for-sale investment securities | 18,864 | 0 | 0 |
Deconsolidation of subsidiaries cash, cash equivalents and restricted cash | (10,545) | 0 | 0 |
Proceeds received from note receivable | 25,832 | 0 | 0 |
Net proceeds from sales of businesses | 0 | 0 | 534,457 |
Net proceeds from sales of property | 0 | 5,000 | 0 |
Capital expenditures | (332,886) | (354,185) | (183,077) |
Net cash (used in) provided by investing activities | (298,735) | (349,182) | 737,880 |
Cash Flows from Financing Activities: | |||
Borrowings of debt | 1,590,000 | 0 | 236,400 |
Repayments of debt | (926,199) | (11,360) | (457,827) |
Repayments of finance leases | (3,206) | (1,033) | 0 |
Repurchase of common stock, including fees | (46,146) | (589,433) | (332,529) |
Issuance of common stock and At-the-Market offering, net of offering costs | 118,975 | 0 | 0 |
Proceeds from issuance of Series A and preferred and common stock warrants | 225,008 | 0 | 0 |
Proceeds from exercise of preferred stock warrants | 47,500 | 0 | 0 |
Payment of dividends | (329) | (749) | (23,108) |
Payment of Exchange Offer costs | (7,992) | 0 | 0 |
Payment of issuance costs related to Series A and preferred and common stock warrants | (6,334) | 0 | 0 |
Payment of deferred financing fees | (24,242) | (3,443) | (7,690) |
Prepayment under share repurchase agreement | 0 | 0 | (47,550) |
Net cash provided by (used in) financing activities | 967,035 | (606,018) | (632,304) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (848) | 1,006 | 5,075 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (323,527) | (936,340) | 378,759 |
Change in cash balances classified as held-for-sale | 0 | 0 | 4,815 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (323,527) | (936,340) | 383,574 |
Cash, cash equivalents and restricted cash: | |||
Beginning of period | 470,884 | 1,407,224 | 1,023,650 |
End of period | $ 147,357 | $ 470,884 | $ 1,407,224 |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Related Matters | 12 Months Ended |
Feb. 25, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies and Related Matters | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS A. Nature of Operations Bed Bath & Beyond Inc. and subsidiaries (the "Company") is an omni-channel retailer that makes it easy for its customers to feel at home. The Company sells a wide assortment of m erchandise in the Home and Baby markets and operates under the names Bed Bath & Beyond ("BBB") and buybuy BABY ("BABY"). Customers can purchase products either in-store, online, with a mobile device or through a customer contact center. The Company generally has the ability to have customer purchases picked up in-store, curbside or shipped direct to the customer from the Company’s distribution facilities, stores or vendors. In addition, the Company is a partner in a joint venture which operates retail stores in Mexico under the name Bed Bath & Beyond. We acc ount for our operations as one North American Retail reporting segment. In Fiscal 2020, we accounted for our operations as two operating segments: North American Retail and Institutional Sales, the latter of which did not meet the quantitative thresholds under GAAP and, therefore, was not a reportable segment, and which was divested in October 2020. Net sales outside of the U.S. for the Company were not material for Fiscal 2022, 2021, and 2020. As the Company operates in the retail industry, its results of operations are affected by general economic conditions and consumer spending habits. On April 23, 2023 (the “Petition Date”), Bed Bath and Beyond, Inc. (the “Company”) and materially all of its direct and indirect subsidiaries (collectively, the "Debtors" or the “Company Parties”) filed a voluntary petition (the “Chapter 11 Cases”) under Chapter 11 of the U.S. Bankruptcy Code (the “Bankruptcy Code”) in the U.S. Bankruptcy Court for the District of New Jersey (the “Bankruptcy Court”). On the Petition Date, the Company Parties filed a motion with the Bankruptcy Court seeking to jointly administer the Chapter 11 Cases. On April 24, 2023, the Bankruptcy Court entered an order approving joint administration under the caption “In re: Bed Bath & Beyond Inc., ” Case No 23-13359. Certain of the Company’s subsidiaries were not included in the Chapter 11 filing. The Company Parties continue to operate their business and manage their properties as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. Following a hearing held on April 24, 2023, the Bankruptcy Court approved, on an interim basis, the Company Parties’ motions seeking a variety of “first-day” relief, including authority to pay employee wages and benefits and to pay vendors and suppliers for goods and services provided both before and after the Petition Date. The Company Parties resolved numerous informal comments and many of the "first-day" motions were entered on a final basis consensually. A hearing was scheduled on June 14, 2023 for the Bankruptcy Court to consider final approval of the relief requested in certain first day motions, and final approval of the DIP Facility. On February 10, 2023 (the “Canadian Petition Date”), BBB Canada Limited made an application with the Ontario Superior Court of Justice (the “Canadian Court”). BBB Canada Limited was granted an order, which, among other provisions, provides a stay of proceedings pursuant to the Companies’ Creditors Arrangement Act (the “CCAA”). The CCAA is a Federal Act that allows financially troubled corporations that owe their creditors in excess of $5 million the opportunity to restructure their affairs. Although Bed Bath & Beyond Canada L.P. (“BBB LP” and together with BBB Canada Limited, “BBB Canada”) did not file an application with the Canadian Court, the stay of proceedings under the CCAA and other benefits were extended to BBB LP. BBB Canada initiated a wind-down of Bed Bath & Beyond and Buy Buy Baby Stores in Canada under the CCAA. A monitor was appointed by the Canadian Court on February 10, 2023 to oversee the orderly liquidation of its remaining inventory with assistance from a third-party professional liquidator and vacate its leased retail stores and premises. See “Deconsolidation – Canadian Subsidiaries,” Note 4, for additional details. B. Fiscal Year The Company’s Fiscal year is comprised of the 52 or 53-week period ending on the Saturday nearest February 28th. Accordingly, Fiscal 2022, Fiscal 2021, and Fiscal 2020 represented 52 weeks and ended on February 25, 2023, February 26, 2022, and February 27, 2021, respectively. C. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. The Company accounts for its investment in the joint venture referred to above under the equity method. All significant intercompany balances and transactions have been eliminated in consolidation. D. Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04 Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendment provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on contracts, hedging relationships and other transactions that reference LIBOR. These updates are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company adopted this standard in Fiscal 2022; upon adoption, this guidance did not have a material impact on its consolidated financial statements. E. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires the Company to establish accounting policies and to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on other assumptions that it believes to be relevant under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. In particular, judgment is used in areas such as inventory valuation, impairment of long-lived assets, impairment of auction rate securities, goodwill and other indefinite lived intangible assets, accruals for self-insurance, litigation, store opening, expansion, relocation and closing costs, the provision for sales returns, vendor allowances, derivatives, stock-based compensation and income and certain other taxes. Actual results could differ from these estimates. F. Cash and Cash Equivalents The Company considers all highly liquid instruments purchased with original maturities of three months or less to be cash equivalents. Included in cash and cash equivalents are credit and debit card receivables from banks, which typically settle within five business days, of $24.5 million and $47.9 million as of February 25, 2023 and February 26, 2022, respectively. Short-term restricted cash was $66.2 million as of February 25, 2023 and is included in current assets on the consolidated balance sheet. The Company had no short-term restricted cash as of February 26, 2022. Long-term restricted cash of $15.3 million and $31.4 million as of February 25, 2023 and February 26, 2022, respectively, is included in total assets on the consolidated balance sheet. G. Investment Securities Investment securities consist primarily of auction rate securities, which are securities with interest rates that reset periodically through an auction process, and U.S. Treasury Bills, when outstanding. The U.S. Treasury Bills with original maturities of greater than three months were classified as short-term held-to-maturity securities and stated at their amortized cost which approximated fair value. Auction rate securities are classified as available-for-sale and are stated at fair value, which had historically been consistent with cost or par value due to interest rates which reset periodically, typically every 7, 28 or 35 days. As a result, there generally were no cumulative gross unrealized holding gains or losses relating to these auction rate securities. However, during the global financial crisis of 2008 the auction process for the Company’s auction rate securities failed and continues to fail. These failed auctions result in a lack of liquidity in the securities and affect their estimated fair values at February 26, 2022, but do not affect the underlying collateral of the securities. Those investment securities which the Company had the ability and intent to hold until maturity are classified as held-to-maturity investments and are stated at amortized cost. Premiums are amortized and discounts are accreted over the life of the security as adjustments to interest income using the effective interest method. Dividend and interest income are recognized when earned. During Fiscal 2022, the Company sold its long-term available-for-sale investment securities of $20.3 million for $18.9 million resulting in a $1.4 million realized loss, of which $1.1 million was reclassified out of accumulated other comprehensive loss. As of February 26, 2021, the Company’s long-term available-for-sale investment securities represented approximately $20.3 million par value of auction rate securities, less temporary valuation adjustments of approximately $1.1 million. Since these valuation adjustments are deemed to be temporary, they are recorded in accumulated other comprehensive loss, net of a related tax benefit, and did not affect the Company’s net earnings. The Company had no short-term available-for-sale investment securities as of February 25, 2023 or February 26, 2022. H. Inventory Valuation Merchandise inventories are stated at the lower of cost or market. Inventory costs are primarily calculated using the weighted average retail inventory method. Under the retail inventory method, the valuation of inventories at cost and the resulting gross margins are calculated by applying a cost-to-retail ratio to the retail values of inventories. The inputs associated with determining the cost-to-retail ratio include: merchandise purchases, net of returns to vendors, discounts and volume and incentive rebates; inbound freight expenses; and import charges, including duties, insurance and commissions. The retail inventory method contains certain management judgments that may affect inventory valuation. At any one time, inventories include items that have been written down to the Company’s best estimate of their realizable value. Judgment is required in estimating realizable value and factors considered are the age of merchandise, anticipated demand based on factors such as customer preferences and fashion trends, and anticipated changes in product assortment (including related to the launch of Owned Brands) as well as anticipated markdowns to reduce the price of merchandise from its recorded retail price to a retail price at which it is expected to be sold in the future. These estimates are based on historical experience and current information about future events which are inherently uncertain. Actual realizable value could differ materially from this estimate based upon future customer demand or economic conditions. For the fiscal years ended February 26, 2022 and February 27, 2021, the Company estimated its reserve for inventory shrinkage throughout the year based on historical shrinkage and any current trends, if applicable. Actual shrinkage was recorded based upon the results of the Company’s physical inventory counts for locations at which counts were conducted. For locations where physical inventory counts were not conducted in the fiscal year, an estimated shrink reserve was recorded based on historical shrinkage and any current trends, if applicable. For the fiscal year-ended February 25, 2023 the Company performed store physical inventory counts at or near fiscal year-end using a statistical sampling approach based on a stratified random sample. The full population of store inventory was estimated and recorded based on an extrapolation using the direct projection method. The Company estimated a reserve for inventory shrinkage for inventory held at other locations based on historical shrinkage and current trends. The Company accrues for merchandise in transit once it takes legal ownership and title to the merchandise; as such, an estimate for merchandise in transit is included in the Company’s merchandise inventories. I. Property and Equipment Property and equipment are stated at cost and are depreciated primarily using the straight-line method over the estimated useful lives of the assets (39 years for buildings; 7 to 20 years for furniture, fixtures and equipment; and 3 to 10 years for computer equipment and software). Leasehold improvements are amortized using the straight-line method over the lesser of their estimated useful life or the life of the lease. Depreciation expense is primarily included within selling, general and administrative expenses. (see "Property and Equipment," Note 10). The cost of maintenance and repairs is charged to earnings as incurred; significant renewals and betterments are capitalized. Maintenance and repairs amounted to $34.7 million, $80.0 million, and $117.7 million for Fiscal 2022, 2021, and 2020, respectively. J. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying value of these assets may exceed their current fair values. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. In Fiscal 2022 and Fiscal 2021, the Company recorded non-cash pre-tax impairment charges respectively, for certain store-level, distribution facilities, corporate assets, including leasehold improvements, other property and equipment and operating lease assets. At February 25, 2023, the required step one recoverability test resulted in estimation uncertainty regarding the ability to achieve future location and enterprise level positive undiscounted cash flows. As such, the Company moved forward with preparing a step two impairment test for its long-lived assets at all store, distribution facility and corporate locations. The Company used market approach models, including orderly liquidation value, to estimate the fair value of store, distribution facility and corporate location long-lived assets, comparing the fair values to the net book values, and calculating the impairment charge. In the future, if events or market conditions affect the estimated fair value to the extent that a long-lived asset is impaired, the Company will adjust the carrying value of these long-lived assets in the period in which the impairment occurs. K. Goodwill and Other Indefinite Lived Intangible Assets Included within other assets in the accompanying consolidated balance sheets as of February 25, 2023 and February 26, 2022, respectively, are $13.2 million and $16.3 million for indefinite lived tradenames and trademarks. The Company reviews its intangible assets that have indefinite lives for impairment annually as of the end of the fiscal year or when events or changes in circumstances indicate the carrying value of these assets might exceed their current fair values. Impairment testing is based upon the best information available including estimates of fair value which incorporate assumptions marketplace participants would use in making their estimates of fair value. Significant assumptions and estimates are required, including, but not limited to, projecting future cash flows, determining appropriate discount rates and terminal growth rates, and other assumptions, to estimate the fair value of goodwill and indefinite lived intangible assets. Although the Company believes the assumptions and estimates made are reasonable and appropriate, different assumptions and estimates could materially impact its reported financial results. Other indefinite lived intangible assets were recorded as a result of acquisitions and primarily consist of tradenames. The Company values its tradenames using a relief-from-royalty approach, which assumes the value of the tradename is the discounted cash flows of the amount that would be paid by a hypothetical market participant had they not owned the tradename and instead licensed the tradename from another company. For the fiscal years ended February 25, 2023, February 26, 2022, and February 27, 2021, the Company completed a quantitative impairment analysis for certain other indefinite lived intangible assets, by comparing the fair value of the tradenames to their carrying value and recognized non-cash pre-tax tradename impairment charges of $2.9 million, $5.7 million, and $35.1 million, respectively, within goodwill and other impairments As of February 25, 2023, for the remaining other indefinite lived intangible assets, the Company assessed qualitative factors in order to determine whether any events and circumstances existed which indicated that it was more likely than not that the fair value of these other indefinite lived assets did not exceed their carrying values and concluded no such events or circumstances existed which would require an impairment test be performed. In the future, if events or market conditions affect the estimated fair value to the extent that an asset is impaired, the Company will adjust the carrying value of these assets in the period in which the impairment occurs. As of February 25, 2023 and February 26, 2022, the Company did not have any goodwill recorded on its consolidated balance sheet. L. Self-Insurance The Company utilizes a combination of insurance and self-insurance for a number of risks including workers’ compensation, general liability, cyber liability, property liability, automobile liability and employee related health care benefits (a portion of which is paid by its employees). Liabilities associated with the risks that the Company retains are not discounted and are estimated by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. Although the Company’s claims experience has not displayed substantial volatility in the past, actual experience could materially vary from its historical experience in the future. Factors that affect these estimates include but are not limited to: inflation, the number and severity of claims and regulatory changes. In the future, if the Company concludes an adjustment to self-insurance accruals is required, the liability will be adjusted accordingly. Beginning in the fourth quarter of Fiscal 2020, the Company began insuring portions of its workers' compensation and medical insurance through a wholly owned captive insurance subsidiary (the "Captive") to enhance its risk financing strategies. The Captive is subject to regulations in Vermont, including those relating to its levels of liquidity and other requirements. The Captive was in compliance with all regulations as of February 25, 2023. M. Shareholders' (Deficit) Equity and Mezzanine Equity The Company has authorization to make repurchases of its common shares from time to time in the open market or through other programs approved by the Board of Directors pursuant to existing rules and regulations. Common stock purchased for treasury is recorded at cost. At the date of subsequent reissue, the treasury stock account is reduced by the cost of such stock, with cost determined on a weighted-average basis (see "Shareholders' (Deficit) Equity and Mezzanine Equity", Note 8). The Company issues various financial instruments, including preferred stock. Instruments containing redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control are classified as redeemable or mezzanine equity. The Company evaluates whether the contingent redemption provisions are probable of becoming redeemable to determine whether the carrying value of the redeemable convertible preferred units are required to be remeasured to their respective redemption values. All instruments that are classified as mezzanine equity are evaluated for embedded derivative features by evaluating each feature against the nature of the host instrument (e.g. more equity-like or debt-like). Features identified as freestanding instruments or bifurcated embedded derivatives that are material are recognized separately as a derivative asset or liability in the consolidated financial statements (see "Shareholders' (Deficit) Equity and Mezzanine Equity", Note 8). N. Fair Value of Financial Instruments The Company’s financial instruments include cash and cash equivalents, investment securities, accounts payable, long-term debt, derivatives, and certain other liabilities. The Company’s investment securities consist primarily of U.S. Treasury securities, which are stated at amortized cost, and auction rate securities consisting of preferred shares of closed end municipal bond funds, which are stated at their approximate fair value. The book value of the financial instruments, excluding the Company’s long-term debt, is representative of their fair values (see "Fair Value Measurements," Note 5). O. Leases The Company determines if an arrangement is a lease or contains a lease at the inception of the contract. The Company’s leases generally contain fixed and variable components. Variable components are primarily contingent rents based upon store sales exceeding stipulated amounts. Lease agreements may also include non-lease components, such as certain taxes, insurance and common area maintenance, which the Company combines with the lease component to account for both as a single lease component. Lease liabilities, which represent the Company’s obligation to make lease payments arising from the lease, and corresponding right-of-use assets, which represent the Company’s right to use an underlying asset for the lease term, are recognized at the commencement date of the lease, which is typically the date the Company obtains possession of the leased premises, based on the present value of fixed future payments over the lease term. The Company utilizes the lease term for which it is reasonably certain to use the underlying asset, including consideration of options to extend or terminate the lease. Incentives received from landlords are recorded as a reduction to the lease right-of-use assets. The Company does not recognize lease right-of-use assets and corresponding lease liabilities for leases with initial terms of 12 months or less. The Company calculates the present value of future payments using the discount rate implicit in the lease, if available, or its incremental borrowing rate. The incremental borrowing rate is the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The Company determined discount rates based on the rates of its unsecured borrowings, which are then adjusted for the appropriate lease term and effects of full collateralization. In determining the Company's operating lease assets and operating lease liabilities, the Company applied these incremental borrowing rates to the minimum lease payments within each lease agreement. For operating leases, lease expense relating to fixed payments is recognized on a straight-line basis over the lease term and lease expense relating to variable payments is expensed as incurred. For finance leases, the amortization of the asset is recognized over the shorter of the lease term or useful life of the underlying asset (see "Leases," Note 9). P. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets in the accompanying consolidated balance sheets as of February 25, 2023 and February 26, 2022, respectively, are $147.3 million and $198.2 million, which includes income tax receivables as of February 25, 2023 and February 26, 2022 of $16.1 million and $26.5 million, respectively (see "Provision for Income Taxes," Note 12). Q. Revenue Recognition Sales are recognized upon purchase by customers at the Company’s retail stores or upon delivery for products purchased from its websites. The value of point-of-sale coupons and point-of-sale rebates that result in a reduction of the price paid by the customer are recorded as a reduction of sales. Shipping and handling fees that are billed to a customer in a sale transaction are recorded in sales. Taxes, such as sales tax, use tax and value added tax, are not included in sales. Revenues from gift cards, gift certificates and merchandise credits are recognized when redeemed. Gift cards have no provisions for reduction in the value of unused card balances over defined time periods and have no expiration dates. In Fiscal 2022 and Fiscal 2021, the Company recognized net sales for gift card and merchandise credit redemptions of approximately $76.7 million and $72.3 million, respectively, which were included in merchandise credit and gift card liabilities on the consolidated balance sheet as of February 26, 2022 and February 27, 2021, respectively. During the second quarter of fiscal 2022, the Company launched its cross-banner customer loyalty program, Welcome Rewards™, which allows members to earn points for each qualifying purchase at its retail banners either online or in its stores. Points earned are then converted to rewards upon reaching certain thresholds. These rewards may then be redeemed on future merchandise purchases at its retail banners. The Company defers a portion of the revenue related to the points earned at the time of the original transaction and revenue is recognized for these performance obligations upon redemption or expiration of points or rewards earned by the customer. As of February 25, 2023, the Company recorded $4.2 million of loyalty program liabilities in accrued expenses and other current liabilities on the consolidated balance sheet. Sales returns are provided for in the period that the related sales are recorded based on historical experience. Although the estimate for sales returns has not varied materially from historical provisions, actual experience could vary from historical experience in the future if the level of sales return activity changes materially. In the future, if the Company concludes that an adjustment is required due to material changes in the returns activity, the liability for estimated returns and the corresponding right of return asset will be adjusted accordingly. As of February 25, 2023 and February 26, 2022, the liability for estimated returns of $6.9 million and $23.6 million is included in accrued expenses and other current liabilities and the corresponding right of return asset for merchandise of $4.8 million and $14.6 million, respectively, is included in prepaid expenses and other current assets, respectively. The Company sells a wide assortment of domestics merchandise and home furnishings. Domestics merchandise includes categories such as bed linens and related items, bath items and kitchen textiles. Home furnishings include categories such as kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings (including furniture and wall décor), consumables and certain juvenile products. Sales of domestics merchandise and home furnishings accounted for approximately 35.8% and 64.2% of net sales, respectively, for Fiscal 2022, 37.4% and 62.6% of net sales, respectively, for Fiscal 2021 and 34.7% and 65.3% of net sales, respectively, for Fiscal 2020. R. Cost of Sales Cost of sales includes the cost of merchandise, buying costs and costs of the Company’s distribution network including inbound freight charges, import charges (including duties), distribution facility costs, receiving costs, internal transfer costs and shipping and handling costs. S. Vendor Allowances The Company receives allowances from vendors in the normal course of business for various reasons including direct cooperative advertising, purchase volume and reimbursement for other expenses. Annual terms for each allowance include the basis for earning the allowance and payment terms, which vary by agreement. All vendor allowances are recorded as a reduction of inventory cost, except for direct cooperative advertising allowances which are specific, incremental and identifiable. The Company recognizes purchase volume allowances as a reduction of the cost of inventory in the quarter in which milestones are achieved. Advertising costs were reduced by direct cooperative allowances of $24.0 million , $35.8 million, and $28.9 million for Fiscal 2022, 2021, and 2020, respectively. T. Store Opening, Expansion, Relocation and Closing Costs Store opening, expansion, relocation and closing costs, including markdowns, asset residual values and projected occupancy costs, are charged to earnings as incurred. U. Advertising Costs Advertising expenses related to direct response advertising are expensed on the first day of the direct response advertising event. All other advertising expenses associated with store advertising are charged to earnings as incurred. Net advertising costs amounted to $393.7 million , $407.1 million, and $347.8 million for Fiscal 2022, 2021, and 2020, respectively. V. Stock-Based Compensation The Company measures all employee stock-based compensation awards using a fair value method and records such expense, net of estimated forfeitures, in its consolidated financial statements. The Company’s stock-based compensation relates to restricted stock awards, stock options, restricted stock units and performance stock units. The Company’s restricted stock awards are considered nonvested share awards (see "Stock-Based Compensation," Note 11). W. Income Taxes The Company files a consolidated federal income tax return. Income tax returns are also filed with each taxable jurisdiction in which the Company conducts business. The Company accounts for its income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. In assessing the recoverability of its deferred tax assets, the Company evaluates the available objective positive and negative evidence to estimate whether it is more likely than not that sufficient future taxable income will be generated to permit use of existing deferred tax assets in each taxpaying jurisdiction. For any deferred tax asset in excess of the amount for which it is more likely than not that the Company will realize a benefit, a valuation allowance is established. A valuation allowance is a non-cash charge, and does not limit the Company's ability to utilize its deferred tax assets, including its ability to utilize tax loss and credit carryforward amounts against future taxable income. The Company recognizes the tax benefit from an uncertain tax position only if it is at least more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest be |
Liquidity and Going Concern
Liquidity and Going Concern | 12 Months Ended |
Feb. 25, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | LIQUIDITY AND GOING CONCERN Under the accounting guidance related to the presentation of financial statements, when preparing financial statements for each annual and interim reporting period, the Company has the responsibility to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. We considered our current financial condition and liquidity sources, including current funds available, forecasted future cash flows and our conditional and unconditional obligations due over the next twelve months. Based on recurring losses from operations and negative cash flows from operations in the amount of $991.0 million for the twelve months ended February 25, 2023, as well as current cash and liquidity projections, we have concluded that substantial doubt exists about our ability to continue as a going concern for the next twelve months. In view of restructuring our existing debt, we filed the Chapter 11 Cases on April 23, 2023. The filing of the Chapter 11 Cases constituted an event of default that allowed the respective lenders to accelerate all of our debt obligations under (i) the Existing Credit Agreement and (ii) the Indenture, dated as of July 17, 2014, as amended by the First Supplemented Indenture, dated as of July 17, 2014, relating to the 3.749% senior unsecured notes due 2024 (the “3.749% Senior Notes”), the 4.915% senior unsecured notes due 2034 (the “4.915% Senior Notes”) and the 5.165% senior unsecured notes due 2044 (the “5.165% Senior Notes” and, together with the 3.749% Senior Notes and the 4.915% Senior Notes, the “Notes”) between the Company and The Bank of New York Mellon, as trustee. Pursuant to Section 362 of the Bankruptcy Code, the filing of the Chapter 11 Cases automatically stayed most actions against or on behalf of the Company Parties, including actions to collect indebtedness incurred prior to the Petition Date or to exercise control over the Company Parties’ property. For more information on the automatic stay, including of any events of default, during the pendency of the Chapter 11 Cases, see “See “Item 3 — Legal Proceedings — Effect of Automatic Stay upon filing under Chapter 11 of the Bankruptcy Code.” The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainty of us being able to continue as a going concern. Given the risks, unknown results and inherent uncertainties associated with a bankruptcy process and the correlation between the Chapter 11 Cases and our ability to satisfy our financial obligations and to develop and execute our business plan, our ability to continue as a going concern is contingent upon, among other things, our ability to successfully emerge from the Chapter 11 Cases and establish a sustainable capital structure through the restructuring process, subject to the Bankruptcy Court’s approval, the effect of the DIP Facility and the DIP Credit Agreement. The outcome of the Chapter 11 Cases is subject to a high degree of uncertainty and is dependent upon factors that are outside of the Company’s control, including actions of the Bankruptcy Court and the company’s creditors. There can be no assurance that the Company will be able to consummate a Chapter 11 plan with respect to the Chapter 11 Cases. As a result of risks and uncertainties related to events of default under our debt obligations, the delisting of our common stock. and the effects of disruption from the Chapter 11 Cases making it more difficult to maintain business, financing and operational relationships, together with the Company’s recurring losses from operations and accumulated deficit, substantial doubt exists regarding our ability to continue as a going concern for the next 12 months. See "Subsequent Events," Note 17, for additional details on the Chapter 11 Cases. |
Restructuring and Transformatio
Restructuring and Transformation Activities | 12 Months Ended |
Feb. 25, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Transformation Activities | Fiscal 2022 Restructuring and Transformation Initiative Expenses During Fiscal 2022, we recorded charges of $407.7 million for costs associated with restructuring and other transformation initiatives, of which approximately $77.7 million is included in cost of sales. In addition, approximately $330.0 million, was recorded in restructuring and transformation initiative expenses in the consolidated statements of operations, which included approximately $156.9 million of accelerated depreciation related to closing facilities and information technology systems, $101.5 million of other restructuring and transformation costs and $58.1 million of severance costs related to workforce reduction, store closures and leadership changes. The Company also recorded approximately $13.5 million for lease related and other costs, including in connection with store closures. Fiscal 2021 Restructuring and Transformation Initiative Expenses The Company recorded $281.2 million in its consolidated statements of operations for the fiscal year ended February 26, 2022 for costs associated with restructuring and other transformation initiatives, of which approximately $137.2 million is included in cost of sales and approximately $144.0 million is included in restructuring and transformation initiative expenses in the consolidated statements of operations. These charges were comprised of, and classified in the Company’s consolidated statement of operations, as follows: Cost of Sales • $125.2 million primarily related to the Company’s initiatives to introduce certain new Owned Brand merchandise and, to a lesser extent, to redefine certain existing Owned Brands and to rationalize product assortment across the Bed Bath & Beyond banner store base. The costs incurred in connection with these activities included higher markdowns on inventory sold in Fiscal 2021, as well as an adjustment to reduce to its estimated realizable value inventory on hand that will be removed from the product assortment as part of these initiatives. • $12.0 million related to store closures for which the closing process had commenced, related primarily to higher markdowns on inventory sold during the period between final announcement of closing and the final closure of the store. Restructuring and Transformation Initiative Expenses • Store Closures . During Fiscal 2021, the Company closed 63 mostly Bed Bath & Beyond stores as part of its real estate and store fleet optimization program which commenced in Fiscal 2020 and included the closure of 207 mostly Bed Bath & Beyond stores through the end of Fiscal 2021 (including the 144 stores closed in Fiscal 2021). For the fiscal year ended February 26, 2022, the Company recorded costs associated with store closures for which the store closing process has commenced of $2.4 million of severance costs and $45.5 million of lease-related and other costs within restructuring and transformation initiative expenses in its consolidated statements of operations. At this point, the Company is unable to estimate the amount or range of amounts expected to be incurred in connection with future store closures. • Other transformation initiatives . During the fiscal year ended February 26, 2022, the Company recorded costs of $96.1 million which include costs recorded in connection with other transformation initiatives, including technology transformation and business strategy and operating model transformation programs across core functions including merchandising, supply chain and finance. Fiscal 2020 Restructuring Charges The Company recorded $149.3 million within cost of sales and restructuring and transformation initiative expenses in its consolidated statement of operations for Fiscal 2020 for costs associated with its planned store closures as part of the fleet optimization plan for which the store closure process has commenced, workforce reduction and other transformation initiatives . As part of the Company's ongoing business transformation, on July 6, 2020, the Board of Directors of the Company approved the planned closure of approximately 200 mostly Bed Bath & Beyond stores by the end of Fiscal 2021 as part of the Company's store fleet optimization program, 144 of which were closed as of February 27, 2021. In Fiscal 2020, the Company recorded costs associated with its planned store closures for which the store closing process has commenced of $21.0 million within cost of sales, $5.3 million of severance costs and $39.2 million of lease-related and other costs within restructuring and transformation initiative expenses in its consolidated statements of operations . In addition, during the second quarter of Fiscal 2020, the Company announced a realignment of its organizational structure as part of its transformation initiative, to further simplify the Company's operations, support investment in its strategic growth plans, and provide additional financial flexibility. In connection with the organizational realignment, the Company implemented a workforce reduction of approximately 2,800 roles from across its corporate headquarters and retail stores. During the second quarter of Fiscal 2020, the Company recorded pre-tax restructuring charges of approximately $23.1 million within restructuring and transformation initiative expenses in its consolidated statements of operations, related to severance and associated costs for this workforce reduction, all of which have been paid during Fiscal 2020 . During Fiscal 2020, t he Company also recorded costs of approximately $26.1 million within cost of sales and $34.6 million within restructuring and transformation initiative expenses in its consolidated statements of operations related to other transformation initiatives. As of February 25, 2023 and February 26, 2022, the remaining accrual for all severance and associated costs relating to restructuring and transformation initiatives was $31.6 million and $12.8 million, respectively. |
Deconsolidation - Canadian Oper
Deconsolidation - Canadian Operations | 12 Months Ended |
Feb. 25, 2023 | |
Deconsolidation Of Subsidiary [Abstract] | |
Deconsolidation - Canadian Operations | DECONSOLIDATION — CANADIAN OPERATIONS On February 10, 2023 (the “Canadian Petition Date”), BBB Canada Limited made an application with the Ontario Superior Court of Justice (the “Canadian Court”). BBB Canada Limited was granted an order, which, among other provisions, provides a stay of proceedings pursuant to the Companies’ Creditors Arrangement Act (the “CCAA”). The CCAA is a Federal Act that allows financially troubled corporations that owe their creditors in excess of $5.0 million the opportunity to restructure their affairs. Although Bed Bath & Beyond Canada L.P. (“BBB LP” and together with BBB Canada Limited, “BBB Canada”) did not file an application with the Canadian Court, the stay of proceedings under the CCAA and other benefits were extended to BBB LP. BBB Canada initiated a wind-down of Bed Bath & Beyond and Buy Buy Baby Stores in Canada under the CCAA. A monitor was appointed by the Canadian Court on February 10, 2023 to oversee the orderly liquidation of its remaining inventory with assistance from a third-party professional liquidator and vacate its leased retail stores and premises. BBB Canada was a consolidated operating subsidiary of the Company. The Company lost control of BBB Canada as material decisions were subject to review by the Canadian Court. For these reasons, we concluded that the Company had lost control of BBB Canada, and no longer had significant influence over BBB Canada during the pendency of bankruptcy. Therefore, we deconsolidated BBB Canada on the Canadian Petition Date. In order to deconsolidate BBB Canada, the carrying values of the assets and certain liabilities of BBB Canada were removed from our consolidated balance sheet as of February 25, 2023, and we recorded our investment in BBB Canada at its estimated fair value of $0. The deconsolidation resulted in the recognition of a loss of $98.6 million during the year ended February 25, 2023, recognized as a non-operating loss in the consolidated statement of operations. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Feb. 25, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., "the exit price") in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various valuation approaches, including quoted market prices and discounted cash flows. The hierarchy for inputs used in measuring fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from independent sources. Unobservable inputs are inputs that reflect a company’s judgment concerning the assumptions that market participants would use in pricing the asset or liability developed based on the best information available under the circumstances. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset or liability must be classified in its entirety based on the lowest level of input that is significant to the measurement of fair value. The fair value hierarchy is broken down into three levels based on the reliability of inputs as follows: • Level 1 - Valuations based on quoted prices in active markets for identical instruments that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. • Level 2 - Valuations based on quoted prices in active markets for instruments that are similar, or quoted prices in markets that are not active for identical or similar instruments, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The Company’s financial instruments include cash and cash equivalents, investment securities, other long-term investments, accounts payable, short-term and long-term debt, derivative liabilities, and certain other liabilities. The book value of the Company's financial instruments, excluding long-term debt, long-term investments and derivative liabilities, are representative of their fair values. The Company’s investment securities at February 26, 2022 consisted primarily of U.S. Treasury securities, which are carried at amortized cost and the fair values are based on quoted prices in active markets for identical instruments (Level 1 valuation). As of February 25, 2023 and February 26, 2022, the fair value of the Company’s senior unsecured notes was approximately $176.3 million and $956.0 million, respectively, which is based on quoted prices in active markets for identical instruments (i.e., Level 1 valuation), compared to the carrying value of approximately $1.030 billion and $1.184 billion, respectively. Short-term debt is measured utilizing Level 2 inputs included the ABL Facility and FILO Facility. As of February 25, 2023, the carrying amount of the ABL Facility and FILO Facility approximates fair value as interest charged is based on the current market rate and are secured on a first priority basis (subject to customary exceptions) on substantially all assets of the Company and its subsidiaries that are borrowers or guarantors under the ABL Facility and FILO Facility. Other long-term investments utilizing Level 3 inputs included auction rate securities consisting of preferred shares of closed end municipal bond funds. On February 7, 2023, the Company consummated an underwritten public offering of (i) shares of Series A Convertible Preferred Stock (“Series A”), (ii) warrants to purchase shares of the Company’s Common Stock (“Common Stock Warrants”), and (iii) warrants to purchase shares of the Company’s Series A Convertible Preferred Stock (“Preferred Stock Warrants”). The gross proceeds received for the Series A was $225.0 million and there was no additional consideration received for the Common Stock Warrants and Preferred Stock Warrants issued. A total of $6.3 million issuance costs were incurred as part of the underwritten public offering and are recognized in loss on preferred stock warrants and derivative liabilities in the consolidated statement of operations. The Company determined the Common Stock Warrants and Preferred Stock Warrants are derivative liabilities initially recorded at fair value with changes in fair value recorded in earnings (see “Derivatives”, Note 6). The Series A is contingently redeemable which results in mezzanine equity classification and has bifurcated embedded derivative features accounted for as a derivative liability (see “Shareholders' (Deficit) Equity and Mezzanine Equity”, Note 8). As the Series A, Common Stock Warrants, and Preferred Stock Warrants were issued when the Company was in distress, the Company determined the offering was not an orderly transaction and the gross proceeds of $225.0 million did not represent fair value. As a result, the Company used a model-derived valuation to estimate the fair value of the Series A embedded derivative liability, Preferred Stock Warrants and Common Stock Warrants in which the most significant value driver is the as-converted value utilizing the Company’s common stock price as the input. At issuance, the fair value of the Series A embedded derivative liability, Common Stock Warrants, and Preferred Stock Warrants was $300.5 million, $186.6 million, and $615.5 million, respectively, and no fair value was allocated to the Series A exclusive of the embedded derivative liability. The Company recorded a $877.6 million loss for the total fair value of $1,102.6 million of the financial instruments issued in excess of proceeds of $225.0 million in loss on preferred stock warrants and derivative liabilities in its consolidated statement of operations for the year ended February 25, 2023. The loss is partially offset by a gain of $244.5 million related to the change in fair value associated with these derivative liabilities for the quarter ended February 25, 2023. Issuance costs of $6.3 million were expensed as incurred. As of February 25, 2023, the fair value of the Series A embedded derivative liability, Common Stock Warrants, and Preferred Stock Warrants was $166.9 million, $2.7 million, and $404.4 million, respectively. On March 30, 2023, the Company entered into the Exchange Agreement with the holders of the remaining Preferred Stock Warrants (see “Derivatives”, Note 6). As a result of the exchange, the Company will recognize a gain of approximately $353.6 million during the first quarter of fiscal 2023. |
Derivatives
Derivatives | 12 Months Ended |
Feb. 25, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | DERIVATIVES Preferred Stock Warrants On February 7, 2023, the Company issued 84,216 Preferred Stock Warrants to acquire up to 84,216 shares of Series A at a price of $9,500 per share. Additionally, in the event the holder holds a Common Stock Warrant, upon exercise of the Preferred Stock Warrant, there is an increase to the amount of common stock issuable upon exercise of the Common Stock Warrant. The Preferred Stock Warrants are exercisable at any time and expire one year after issuance. The terms allow the Company to force the holders to exercise the Preferred Stock Warrants after every 20 trading day period provided there are no equity condition failures. During the year ended February 25, 2023, 5,000 Preferred Stock Warrants were exercised for gross proceeds of $47.5 million. The Preferred Stock Warrants are classified as a liability in accordance with ASC 480 and initially recorded at fair value with subsequent changes in fair value recorded in earnings. The Company recognizes the Preferred Stock Warrants in Derivative liabilities on the consolidated balance sheet and subsequent changes in fair value in loss on preferred stock warrants and derivative liabilities in the consolidated statement of operations. On March 7, 2023, 9,212 Preferred Stock Warrants were exercised for gross proceeds of $87.5 million. On March 13, 2023, the Company entered into an amendment to the Preferred Stock Warrants in which the holder elected to reduce equity condition thresholds, including certain common stock price and volume requirements such that the Preferred Stock Warrants could still be callable by the Company. On March 30, 2023, the Company and holder entered into the Exchange Agreement, as the Company anticipated that it would not be able to meet the conditions to force the exercise of the Preferred Stock Warrant in the future and receive cash proceeds. Pursuant to the Exchange Agreement, the Company exchanged the remaining 70,004 Preferred Stock Warrants for 10,000,000 shares of common stock and rights to receive 5,000,000 shares of common stock upon the receipt of shareholder approval of a proposal to effectuate a reverse stock split of the Company’s commons stock to be presented to shareholders at a forthcoming special meeting of shareholders (as discussed in “Shareholders' (Deficit) Equity and Mezzanine Equity”, Note 8). The Company also granted to the holder a right to participate, subject to the terms set forth in the Exchange Agreement, in certain future equity or equity-linked offerings of the Company for a period of two years from the date of the Exchange Agreement. Common Stock Warrants On February 7, 2023, the Company issued 95,387,533 Common Stock Warrants to acquire up to approximately 95 million shares of common stock at a strike price of $6.15 per share. The Common Stock Warrants are exercisable at any time and expire five years after issuance. The terms provide for an alternate cashless exercise that allows the holder to receive 0.65 shares of common stock for each share underlying the Common Stock Warrant, for a total of up to 62 million shares of common stock at no cost. During the year ended February 25, 2023, 5,000 Preferred Stock Warrants were exercised resulting in an increase of 16.3 million shares of common stock issuable upon exercise of Common Stock Warrants. The Common Stock Warrants are classified as a liability in accordance with ASC 815-40 and initially recorded at fair value with subsequent changes in fair value recorded in earnings. The Commons Stock Warrants are recorded at fair value in Derivative liabilities in the consolidated balance sheets and subsequent changes in fair value are recorded in loss on preferred stock warrants and derivative liabilities in the consolidated statement of operations. During the year ended February 25, 2023, 109.0 million Common Stock Warrants were exercised and shares were reissued out of treasury stock at a weighted-average cost of $44.27 per share, for a total cost of $3.1 billion. The difference between the cost of the treasury stock and the fair value of common stock issued upon exercise is recorded as a reduction to retained earnings on the consolidated balance sheet and is included within the equity roll forward. On March 7, 2023, 9,212 Preferred Stock Warrants were exercised resulting in an increase of 37.3 million shares of common stock issuable upon exercise of Common Stock Warrants. |
Debt
Debt | 12 Months Ended |
Feb. 25, 2023 | |
Debt Disclosure [Abstract] | |
Debt | DEBT Senior Unsecured Notes On July 17, 2014, the Company issued $300.0 million aggregate principal amount of 3.749% senior unsecured notes due August 1, 2024 (the "2024 Notes"), $300.0 million aggregate principal amount of 4.915% senior unsecured notes due August 1, 2034 (the "2034 Notes"), and $900.0 million aggregate principal amount of 5.165% senior unsecured notes due August 1, 2044 (the "2044 Notes" and, collectively with the 2024 Notes and the 2034 Notes, the "Existing Notes"). Interest on the Notes is payable semi-annually on February 1 and August 1 of each year. The Existing Notes were issued under an indenture (the "Base Indenture"), as supplemented by a first supplemental indenture (together, with the Base Indenture, the "Indenture"), which contains various restrictive covenants, which are subject to important limitations and exceptions that are described in the Indenture. On February 1, 2023, the Company missed interest payments due on the Company’s 3.749% Senior Notes due 2024, 4.915% Senior Notes due 2034 and 5.165% Senior Notes due 2044 (collectively, the "Existing Notes") and had a 30-day grace period to pay these interest payments. On February 28, 2023, the Company paid off interest on the Existing Notes. Exchange Offers During the third fiscal quarter of 2022, the Company commenced exchange offers (the "Exchange Offers") with eligible holders for each series of Existing Notes as follows: (i) 2024 Notes for new 3.693% Senior Second Lien Secured Non-Convertible Notes due November 30, 2027 (the “New Second Lien Non-Convertible Notes”) and/or new 8.821% Senior Second Lien Secured Convertible Notes due November 30, 2027 (the “New Second Lien Convertible Notes”); (ii) 2034 Notes for new 12.000% Senior Third Lien Secured Convertible Notes due November 30, 2029 (the “New Third Lien Convertible Notes” and, together with the New Second Lien Non-Convertible Notes and the New Second Lien Convertible Notes, the “New Notes”); and (iii) 2044 Notes for New Third Lien Convertible Notes. In conjunction with the Exchange Offers, the Company solicited consents from holders of each series of Existing Notes (“Consents”) to certain proposed amendments to the indenture governing the Existing Notes to, among other things, (i) eliminate the restrictive covenants in the Existing Notes Indenture concerning (a) the repurchase of Existing Notes in the event of a change in control of the Company, (b) limitations on liens and (c) limitations on sale and leaseback transactions and (ii) increase the percentage of outstanding notes necessary to accelerate payment upon an event of default (the “Proposed Amendments”). In November 2022, the Company completed privately negotiated exchange offers with existing holders of approximately $69.0 million, $15.3 million, and $70.2 million aggregate principal amount of 2024 Notes, 2034 Notes, and 2044 Notes, respectively, under which the Company issued an aggregate of approximately 13.6 million shares of common stock to the existing holders in exchange for the exchange notes, including accrued and unpaid interest, and 0.9 million shares in exchange for a cash payment from an existing holder of $3.5 million. The exchange notes were cancelled and no longer outstanding upon completion of the exchange. In accordance with ASC subtopic 470-60, " Troubled Debt Restructuring by Debtors ," the private exchange was accounted for as a troubled debt restructuring and the Company recorded a net gain on extinguishment of debt of $94.4 million in its consolidated statement of operations for Fiscal 2022, which included $8.0 million of third-party fees incurred and the write off of unamortized debt financing costs of $0.4 million related to the extinguished notes exchanged for common stock. On January 5, 2023, upon the expiration of the Exchange Offers, the Company announced the termination of the offer and consent solicitations with respect to its Existing Notes, as a result of the conditions applicable thereto not being satisfied. As a result of the termination of the Exchange Offers, none of the Existing Notes that had been tendered in the Exchange Offers were accepted for purchase and no consideration will be paid or become payable to holders of the Existing Notes who have tendered their Existing Notes in the Exchange Offers. During Fiscal 2022, the Company did not purchase any of its outstanding unsecured notes, excluding the aforementioned private exchanges completed in November 2022. During Fiscal 2020, the Company purchased approximately $11.0 million aggregate principal amount of its outstanding 3.749% senior unsecured notes due August 1, 2024. The total consideration paid for the notes accepted for purchase of $11.4 million during the fiscal year ended February 26, 2022 included accrued and unpaid interest up to, but not including, the early settlement date. The Company recorded a loss on extinguishment of debt of $0.4 million in its consolidated statement of operations for the fiscal year ended February 27, 2021, including the write off of unamortized debt financing costs related to the extinguished portion of the notes accepted for purchase and reacquisition costs. As of February 25, 2023 and February 26, 2022, unamortized deferred financing costs associated with the Company’s Existing Notes were $3.8 million and $4.6 million, respectively, and are included in long-term debt in the Company's consolidated balance sheets. Bed Bath and Beyond, Inc.’s filing of the Chapter 11 Cases constitutes an event of default that accelerated its obligations under the New Notes. Pursuant to Section 362 of the Bankruptcy Code, the filing of the Chapter 11 Cases automatically stayed most actions against the applicable debtor, including actions to collect indebtedness incurred prior to the Petition Date or to exercise control over the applicable debtor’s property. Subject to certain exceptions under the Bankruptcy Code, the filing of the Chapter 11 Cases also automatically stayed the continuation of most legal proceedings or the filing of other actions against or on behalf of the applicable debtor or its property to recover on, collect or secure a claim arising prior to the Petition Date or to exercise control over property of the applicable debtor’s bankruptcy estates, unless and until the Bankruptcy Court modifies or lifts the automatic stay as to any such claim. Notwithstanding the general application of the automatic stay described above, governmental authorities may determine to continue actions brought under their police and regulatory powers. Asset-Based Credit Agreement In the second quarter of Fiscal 2021, the Company amended its asset-based credit agreement (the "Credit Agreement") among the Company, certain of the Company’s U.S. and Canadian subsidiaries party thereto, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent (in such capacity, the "Agent"), and the lenders party thereto. The Credit Agreement provides for an asset based revolving credit facility (the “ABL Facility”) with aggregate revolving commitments established at closing of $1.0 billion, including a swingline sub facility and a letter of credit sub facility. The Credit Agreement has an uncommitted expansion feature which allows the borrowers to request, at any time following the delivery of an initial field exam and appraisal, an increase in aggregate revolving commitments under the ABL Facility or elect to enter into a first-in-last-out loan facility ("FIFO Facility"), collectively, in an aggregate amount of up to $375.0 million, subject to certain customary conditions. On August 31, 2022, the Company entered into an amendment (the "First Amendment") to the Credit Agreement, dated as of August 9, 2021 (as amended by the Amendment, the “First Amended Credit Agreement”), for more than $500.0 million of new additional financing commitments, including its newly expanded $1.130 billion ABL Facility, which provides for an increase of $130.0 million in aggregate revolving commitments for the time periods set forth in the Amendment, and a new $375.0 million FILO Facility (the "Initial FILO Loan", together with the ABL Facility, the "Credit Facilities"), with JPMorgan Chase Bank, N.A., as administrative agent and Sixth Street Specialty Lending, Inc., as agent and lender for the FILO Facility. The ABL Facility and FILO Facility mature on August 9, 2026 and August 31, 2027, respectively, unless required to mature earlier pursuant to the terms of the Amendment. On February 7, 2023, the Company entered into a second amendment (the “Second Amendment”) to the Credit Agreement. Pursuant to the Amendment, the lenders agreed to (i) waive any outstanding defaults or events of default under the existing Credit Facilities and (ii) rescind the implementation of the acceleration of obligations under the existing Credit Facilities, the requirement to cash collateralize letters of credit obligations under the existing Credit Facilities and the default interest on the outstanding obligations under the existing Credit Facilities. The Amendment (i) decreased the total revolving commitment from $1.13 billion to $565 million, (ii) result in an increased outstanding principal amount as a result of the call protection make-whole amount of $53.9 million being capitalized as principal to the Initial FILO Loan and (iii) provide for an additional $100.0 million of FILO loans (the “2023 FILO Loan” and together with the Initial FILO Loan, the “FILO Facility”, and together with the ABL Facility, the “Credit Facilities”). Under the Second Amendment, the Company is required to apply all net cash proceeds received from the 2023 FILO Loan and the ATM Program to repay outstanding revolving loans under the ABL Facility. The Company will be able to continue to borrow under its ABL Facility subject to availability thereunder. The Credit Facilities are secured on a first priority basis (subject to customary exceptions) on substantially all assets of the Company and its subsidiaries that are borrowers or guarantors under the Credit Facilities. Amounts available to be drawn from time to time under the ABL Facility (including, in part, in the form of letters of credit) are equal to the lesser of (i) outstanding revolving commitments under the Amended Credit Agreement and (ii) a borrowing base equal to the sum of (a) 90% of eligible credit card receivables plus (b) 90% of eligible inventory (excluding eligible foreign in-transit inventory), valued at the lower of cost or market value, determined on a weighted average cost basis, minus (c) customary reserves, minus (d) FILO deficiency reserves. The term loans under the FILO Facility are subject to a borrowing base equal to the sum of (a) 15% of eligible credit card receivables, plus (b)(i) 15% of eligible inventory, plus (ii) 100% of eligible foreign in transit inventory, plus (iii) 15% of eligible domestic in-transit inventory, in each case, valued at the lower of cost or market value, determined on a weighted average cost basis, plus (c) the lesser of (i) 68% of eligible intellectual property, which shall be reduced by 2.5% each fiscal quarter commencing with the fiscal quarter ending on or about May 8, 2023 and (ii) $115.0 million which shall be reduced by (A) approximately $4.7 million each fiscal quarter commencing with the fiscal quarter ending on or about May 8, 2023 and (B) $75.0 million upon the consummation of certain dispositions. Subject to customary exceptions and restrictions, the Company may voluntarily repay outstanding amounts under the ABL Facility at any time without premium or penalty and may voluntarily repay outstanding amounts under the FILO Facility after the ABL Facility is paid in full. Any voluntary prepayments made will not reduce commitments under the ABL Facility. If at any time the outstanding amount under the ABL Facility exceeds the lesser of (i) the aggregate revolving commitments and (ii) the borrowing base under the ABL Facility, the Company will be required to prepay outstanding amounts or cash collateralize letter of credit obligations under the ABL Facility. The term loans under the FILO Facility are callable at any time. Prepayments of the FILO Facility are subject to a prepayment premium equal to (i) the make-whole amount if prepaid within 18 months following the funding date, (ii) 2.00% of the principal amount of such prepayment if made between 18 months and 30 months following the funding date, (iii) 1.00% of the principal amount of such prepayment if made between 30 months and 36 months following the funding date, and (iii) 0% after such date. Further, certain dispositions of assets are subject to modified prepayment premiums and/or mandatory paydown requirements. If at any time the outstanding amount under the FILO Facility exceeds the borrowing base under the FILO Facility, the Company will be required to prepay term loans in an amount equal to such excess under the FILO Facility. The First Amendment replaced the London Inter-Bank Offered (“LIBO”) Rate as the interest rate benchmark under the Credit Agreement with the forward-looking term rate based on the Secured Overnight Financing Rate (“SOFR”). Outstanding amounts under the Amended Credit Agreement bear interest at a rate per annum equal to, at the applicable borrower’s election: (i) in the case of loans denominated in U.S. dollars, SOFR and an alternate base rate and (ii) in the case of loans denominated in Canadian dollars, the Canadian Prime Rate and Canadian Dollar Offered Rate ("CDOR"), in each case as set forth in the First Amended Credit Agreement, plus (A) with respect to the ABL Facility, an interest rate margin based on average quarterly availability ranging from (x) in the case of SOFR loans and CDOR loans, 1.25% to 1.75%; provided that if SOFR or the CDOR is less than 0.00%, such rate shall be deemed to be 0.00%, as applicable, and (y) in the case of alternate base rate loans and Canadian Prime Rate Loans, 2.25% to 2.75%; provided that if the alternate base rate or Canadian Prime Rate is less than 1.00% such rate shall be deemed to be 1.00%, as applicable, and (B) with respect to the FILO Facility, an interest rate margin equal to (x) in the case of SOFR loans, 7.75%; provided that if SOFR is less than 1.00%, such rate shall be deemed to be 1.00%, and (y) in the case of alternate base rate loans, 6.75%; provided that if the alternate base rate is less than 2.00%, such rate shall be deemed to be 2.00%. The revolving loans under the ABL Facility may be borrowed, prepaid, and reborrowed until the maturity date under the ABL Facility. The Initial FILO Term Loan amortizes at 5.00% per annum payable in equal quarterly installments of 1.25% per annum, commencing with the fiscal quarter ending on or about February 25, 2023. The 2023 FILO Term Loan amortizes at 5.00% per annum payable in equal quarterly installments of 1.25%, commencing with the fiscal quarter ending on or about May 8, 2023. The Amended Credit Agreement contains customary representations and warranties, events of default and financial, affirmative and negative covenants for facilities of this type, including but not limited to a springing financial covenant relating to a fixed charge coverage ratio, and restrictions on indebtedness, liens, investments and acquisitions, asset dispositions, restricted payments and prepayment of certain indebtedness. The Company was in compliance with all covenants related to the Second Amended Credit Agreement as of February 25, 2023. As of February 25, 2023, the Company had $191.3 million of borrowings outstanding under the ABL Facility, at a weighted average interest rate of 8.68%, and $126.9 million of outstanding letters of credit had been issued under the ABL Facility. As of February 25, 2023, the Company had $428.9 million of outstanding borrowings under the Initial FILO Term Loan. The original principal amount of $375 million for the Initial FILO Term Loan has an interest rate of 12.30%, and the make-whole amount of $53.9 million has an interest rate of 12.59% that is paid-in-kind. As of February 25, 2023, the Company had $100.0 million of outstanding borrowings under the 2023 FILO Term Loan at an interest rate of 12.59%. The Company's borrowings under the Credit Facilities as of February 25, 2023 are included in Current portion of long-term debt in the Company’s consolidated balance sheets. As of February 25, 2023 and February 26, 2022, deferred financing costs associated with the Company's ABL Facility were $9.8 million and $7.4 million, respectively, and were recorded in other assets in the Company's consolidated balance sheets. As of February 25, 2023, deferred financing costs associated with the Company's FILO Facility were $20.9 million and are included in Current portion of long-term debt in the Company's consolidated balance sheets. The Company amortizes deferred financing costs for the Existing Notes and the Credit Facilities over their respective terms and such amortization is included in interest expense, net in the consolidated statements of operations. Interest expense related to the Notes and the Credit Facilities, including the commitment fee and the amortization of deferred financing costs, was approximately $107.5 million, $64.1 million, and $73.6 million for the fiscal years ended February 25, 2023, February 26, 2022, and February 27, 2021, respectively. On March 6, 2023, the Company entered into a third amendment to the Credit Agreement (the “Third Amendment). The Third Amendment waived certain events of default under the Credit Agreement related to negative and affirmative covenants. The Third Amendment also revised provisions related to the equity commitment required therein. In particular, the Third Amendment sets forth the requirement to receive minimum specified equity proceeds of approximately $100 million by April 6, 2023, and every twenty-two On March 7, 2023, the Company exercised Preferred Stock Warrants (see “Derivatives,” Note 6) and the proceeds received helped satisfy the March Funding Requirement under the Third Amendment. The Company used proceeds received to date to repay amounts outstanding under the ABL facility. On March 30, 2023, the Company entered into a waiver and amendment (the “Fourth Amendment”) to the Credit Agreement. The Fourth Amendment waived certain events of default under the Credit Agreement related to negative and affirmative covenants. The Fourth Amendment also revised provisions relating to the equity commitment required therein to reflect the Company’s entry into an ATM Agreement and the Common Stock Purchase Agreement. In particular, the Fourth Amendment sets forth (i) the requirement to receive minimum specified equity proceeds or (ii) to demonstrate the minimum cumulative specified equity proceeds. These testing periods are weekly for the next 8 out of 11 weeks requiring a minimum raise with an aggregate cumulative equity raise requirement of approximately $232 million by June 27, 2023 and then $12.5 million weekly thereafter subject to exceptions. In addition, the Fourth Amendment requires that the Company establishes reserves related to the equity proceeds received. As of the date hereof, the conditions detailed above have been met as of the date required. The Company, however, may not be able to meet the conditions on future dates. The failure to meet these conditions would likely cause the Company to file for bankruptcy. On April 6, 2023, the Company entered into an amendment (the “ Fifth Amendment”) to the Credit Agreement. The Amendment permitted the entry into an amendment to the Consignment Agreement, by and between the Company, certain of its subsidiaries and Restore Capital (BBB), LLC (the “Consignment Agreement”). The Amendment also added an Event of Default under the Amended Credit Agreement in the event that the Consignment Agreement is not extended at least fifteen days prior to the termination date therein. Additionally, from the date that the Consignment Agreement is terminated until the Company pays the Buy-Out Price (as defined in the Consignment Agreement), a reserve equal to the amount of the Buy-Out Price and any outstanding fees due and payable to the consignor under the Consignment Agreement will be implemented (see “Subsequent Events,” Note 17). The Company's filing of the Chapter 11 Cases constitutes an event of default that accelerated its obligations under the Credit Facilities. Pursuant to Section 362 of the Bankruptcy Code, the filing of the Chapter 11 Cases automatically stayed most actions against the applicable debtor, including actions to collect indebtedness incurred prior to the Petition Date or to exercise control over the applicable debtor’s property. Subject to certain exceptions under the Bankruptcy Code, the filing of the Chapter 11 Cases also automatically stayed the continuation of most legal proceedings or the filing of other actions against or on behalf of the applicable debtor or its property to recover on, collect or secure a claim arising prior to the Petition Date or to exercise control over property of the applicable debtor’s bankruptcy estates, unless and until the Bankruptcy Court modifies or lifts the automatic stay as to any such claim. Notwithstanding the general application of the automatic stay described above, governmental authorities may determine to continue actions brought under their police and regulatory powers. |
Shareholders' (Deficit) Equity
Shareholders' (Deficit) Equity and Mezzanine Equity | 12 Months Ended |
Feb. 25, 2023 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' (Deficit) Equity and Mezzanine Equity | SHAREHOLDERS' (DEFICIT) EQUITY AND MEZZANINE EQUITYRepurchase Program The Company has authorization to make repurchases of shares of the Company’s common stock from time to time in the open market or through other parameters approved by the Board of Directors pursuant to existing rules and regulations. Between December 2004 and April 2021, the Company’s Board of Directors authorized, through several share repurchase programs, the repurchase of $12.950 billion of its shares of common stock. The Company also acquires shares of its common stock to cover employee related taxes withheld on vested restricted stock, restricted stock units and performance stock unit awards. Since the initial authorization in December 2004, the aggregate total of common stock repurchased is approximately 123.3 million shares for a total cost of approximately $11.731 billion. The Company had approximately $1.221 billion remaining of authorized share repurchases as of February 25, 2023. Decisions regarding share repurchases are within the discretion of the Board of Directors, and are influenced by a number of factors, including the price of the Company's common stock, general business and economic conditions, the Company's financial condition and operating results, the emergence of alternative investment or acquisition opportunities, changes in business strategy and other factors. The Company's share repurchase program could change, and could be influenced by several factors, including business and market conditions, such as the impact of the COVID-19 pandemic. The Company reviews its alternatives with respect to its capital structure on an ongoing basis. Any future share repurchases will be subject to the determination of the Board of Directors, based on an evaluation of the Company's earnings, financial condition and requirements, business conditions and other factors, including the restrictions on share repurchases under the ABL Facility (see "Long-Term Debt," Note 7). In connection with its share repurchase program, during the twelve months ended February 25, 2023, the Company repurchased approximately 2.3 million shares of its common stock, at a total cost of approximately $40.4 million, including fees. The share repurchase program was completed in the first quarter of fiscal 2022. Additionally, during the twelve months ended February 25, 2023, the Company repurchased approximately 0.5 million shares of its common stock, at a total cost of approximately $5.7 million, to cover employee related taxes withheld on vested restricted stock, restricted stock unit awards and performance stock unit awards. In January 2021, the Company entered into a second accelerated share repurchase agreement to repurchase an aggregate $150.0 million of its common stock, subject to market conditions. This resulted in the repurchase of 5.0 million shares in the fourth quarter of Fiscal 2020, and an additional 0.2 million shares received upon final settlement in the first quarter of Fiscal 2021. ATM Program On August 31, 2022, the Company established an at the market equity distribution program (the "ATM Program") by entering into an Open Market Sale Agreement with Jefferies LLC, acting as sales agent for the Company, pursuant to which the Company may issue and sell, from time to time, shares of its common stock, par value $0.01 per share, in any method permitted by law deemed to be an "at the market offering" as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended. Pursuant to the prospectus supplement dated August 31,2022, the Company offered and sold 12.0 million shares of common stock for net proceeds of $72.2 million. On October 28, 2022, the Company filed a prospectus supplement to register additional shares of its common stock, par value $0.01 per share, to offer and sell under its ATM Program at an aggregate sales price of up to $150.0 million. The potential net proceeds, after commissions and offering costs, from the ATM Program were expected to be used for a number of general corporate purposes, which included immediate strategic priorities such as rebalancing the Company's assortment and inventory, and the repayment, refinancing, redemption or repurchase of existing indebtedness. During both the twelve months ended February 25, 2023, the Company has sold approximately 22.2 million shares for approximately $115.4 million of net proceeds under the ATM Program. Shares having an aggregate offering price of $105.6 million remained unsold under the ATM program as of the end of fiscal December 2022. During Fiscal 2016, the Company’s Board of Directors authorized a quarterly dividend program. In March 2020, the Company suspended its future quarterly declarations of cash dividends as a result of the COVID-19 pandemic. During Fiscal 2022, 2021, and 2020, total cash dividends of $0.3 million, $0.7 million, $23.1 million, respectively, were paid. Any future quarterly cash dividend payments on its common stock will be subject to the determination by the Board of Directors, based on an evaluation of the Company’s earnings, financial condition and requirements, business conditions and other factors, including the restrictions on the payment of dividends contained in the Amended Credit Agreement (see "Long-Term Debt," Note 7). Cash dividends, if any, are accrued as a liability on the Company’s consolidated balance sheets and recorded as a decrease to retained earnings when declared. On March 30, 2023, the Company entered into a Sale Agreement with B. Riley Securities, Inc., as a sales agent, to offer and sell additional shares of common stock having an aggregate sales price of up to $300 million from time to time through the Company’s “at the market offering” agreement (“ATM Agreement ”). In connection with the Company’s entry into the ATM Agreement, the Company terminated the Open Market Sale Agreement and ATM Program, effective March 30, 2023. The equity commitments requirement set forth in the Fourth Amendment to the Credit Agreement (see “Debt”, Note 7) is based on proceeds received under the ATM Agreement. On March 30, 2023, the Company also entered into a Common Stock Purchase Agreement and a Registration Rights Agreement with B. Riley Principal Capital II, LLC (“B. Riley Principal”). Pursuant to the Purchase Agreement, subject to the satisfaction of the conditions set forth in the Purchase Agreement, the Company will have the right to sell to B. Riley Principal, up to the lesser of (i) $1,000,000,000 of newly issued shares of the Company’s common stock, par value $0.01 per share, and (ii) the Exchange Cap, from time to time during the term of the Purchase Agreement. The Company announced a special shareholders meeting for May 9, 2023 for a proposed amendment to the Company’s Amended and Restated Certificate of Incorporation to effect, at the discretion of the Board of Directors, a reverse stock split of the Company’s common stock, par value $0.01 per share, at a ratio in the range of 1-for-10 to 1-for-20, with such ratio to be determined at the discretion of the Board. On April 24, 2023, in light of the filing of the Chapter 11 Cases, the Company received written notice from the Listing Qualifications Department of the Nasdaq Stock Market LLC ("Nasdaq") notifying the Company that the Company's common stock will be delisted from Nasdaq. The Company did not appeal this determination. Trading of the Company's common stock was suspended at the opening of business on May 3, 2023. On April 25, 2023, the Board of Directors of the Company determined to cancel the special meeting of shareholders, previously scheduled for May 9, 2023 and to withdraw the proposals to have been submitted to shareholders at the Special Meeting. On April 28, 2023, the Company withdrew the Registration Statement on Form S-1 as it has determined not to proceed with an offering at this time. Mezzanine Equity On February 7, 2023, pursuant to an underwritten public offering, the Company issued 23,685 shares of Series A Convertible Preferred Stock with an original issuance price of $10,000 per share. The Company classifies the Series A as mezzanine equity as the instrument is contingently redeemable outside of the control of the Company. The Series A embedded derivative features were evaluated against the debt-like host and bifurcated embedded derivatives are recognized separately as a derivative liability in Derivative liabilities in the consolidated balance sheets. The derivative liability was initially recorded at fair value with subsequent changes in fair value recorded in loss on preferred stock warrants and derivative liabilities in the consolidated statement of operations. Given the material embedded derivative features, there is no value recognized for the host instrument. There is no remeasurement of the Series A in mezzanine equity as the derivative liability represents the redemption value. During the year ended February 25, 2023, 13,543 Series A were converted and shares were reissued out of treasury stock at a weighted-average cost of $44.27 per share, for a total cost of $3.1 billion. The difference between the cost of the treasury stock and the consideration received is recorded as a reduction to retained earnings on the consolidated balance sheets. See Fair Value Measurements, Note 5, for fair value measurements related to the Series A derivative liability. The terms and preferences of the Series A are summarized as follows: Conversion Rights The Series A are convertible, at any time, at the option of the holder, into a number of shares of common stock based on the conversion rate. The conversion rate is equal to the original issuance price plus all declared and unpaid dividends divided by the applicable conversion price. The conversion price is the lower of (1) $6.15, and (2) the greater of (a) $0.7160 and (b) 92% of the lowest volume weighted average price (“VWAP”) of common stock during the trailing ten Dividend Rights The Series A are entitled to receive dividends when and as declared by the Company’s board. To the extent a dividend is declared on common stock, holders of the Series A would participate on an as-converted basis. Voting Rights The holders of the Series A shall have no voting power and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of share of capital stock, except as otherwise required by the certain laws or for votes that would amend the terms of Series A. Liquidation Rights Upon liquidation of the Company, holders of the Series A have a liquidation preference over holders of our common stock and will be entitled to receive, prior to any distribution to holders of our common stock, an amount equal to the greater of (i) the stated value plus accrued and unpaid dividends multiplied by 125% or (ii) the if-converted value of the common stock that would have been received if the Series A had been converted into common stock immediately prior to the liquidation event at the then effective conversion price. In the event liquidation funds are insufficient, the holders of the Series A will receive an amount equivalent to the percentage of their liquidation preference. Redemption Rights The holders of the Series A shall have the right to redeem in cash all or part of such holder’s shares of Series A upon bankruptcy ("Bankruptcy Triggering Event") or a change of control. Redemption upon bankruptcy results in a cash payment equal to the greater of (i) the original issuance price plus all declared and unpaid dividends multiplied by 115% and (ii) the if-converted value of common stock multiplied by 115%. The redemption upon change of control results in a payout in either cash or other form of consideration at the Company’s election, equal to the greater of (i) the stated value plus accrued and unpaid dividends multiplied by 115% and (ii) the if-converted value of common stock in the event of an equity conditions failure. The filing of the Chapter 11 Cases on April 23, 2023 constitutes a Bankruptcy Triggering Event of the preferred stock, as a result of which mandatory cash redemption provisions are triggered. In addition, the filing of the Chapter 11 Cases triggers a holder’s ability to convert the preferred stock at an alternate conversion price, which could result in a conversion price of lesser than $0.7160. |
Leases
Leases | 12 Months Ended |
Feb. 25, 2023 | |
Leases [Abstract] | |
Leases | LEASES The Company leases retail stores, as well as distribution facilities, offices and equipment, under agreements expiring at various dates throug h 2041. T he leases provide for original lease terms that generally range from 10 to 15 years and most leases provide for a series of five year renewal options, often at increased rents, the exercise of which is at the Company's sole discretion. Certain leases provide for contingent rents (which are based upon store sales exceeding stipulated amounts and are immaterial in Fiscal 2022, 2021, and 2020), scheduled rent increases and renewal options. The Company is obligated under a majority of the leases to pay for taxes, insurance and common area maintenance charges. The Company subleases certain real estate to unrelated third parties, all of which have been classified as operating leases. The Company recognizes sublease income on a straight-line basis over the sublease term, which generally ranges from 5 to 10 years. Most sublease arrangements provide for a series of five year renewal options, the exercise of which are at the Company's sole discretion. The Company regularly negotiates lease terms with landlords, including in connection with its transformation initiatives. Beginning in the first quarter of Fiscal 2021, in order to maintain liquidity given temporary store closures as a result of the COVID-19 pandemic, the Company withheld portions of and/or delayed or deferred payments to certain landlords, including in connection with renegotiations of lease terms. In some instances, the renegotiations led to agreements with landlords for rent abatements or rental deferrals. In Fiscal 2022, the Company has continued to withhold payments to certain landlords in connection with certain negotiations of payment terms. Total payments withheld and/or delayed or deferred as of February 25, 2023 and February 26, 2022 were approximately $0.2 million and $1.9 million , respectively, and are included in current liabilities. In accordance with the FASB’s Staff Q&A regarding rent concessions related to the effects of the COVID-19 pandemic, the Company has elected to account for the concessions agreed to by landlords that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee as though enforceable rights and obligations for those concessions existed in the original lease agreements and the Company has elected to not remeasure the related lease liabilities and right-of-use assets. For qualifying rent abatement concessions, the Company has recorded negative lease expense for the amount of the concession during the period of relief, and for qualifying deferrals of rental payments, the Company has recognized a non-interest bearing payable in lieu of recognizing a decrease in cash for the lease payment that would have been made based on the original terms of the lease agreement, which will be reduced when the deferred payment is made in the future. During the fiscal year ended February 26, 2022, the Company recognized reduced rent expense of $2.7 million related to rent abatement concessions. The components of total lease cost for the fiscal year ended February 25, 2023 and February 26, 2022 were as follows: (in thousands) Statement of Operations Location February 25, 2023 February 26, 2022 Operating lease cost Cost of sales and SG&A $ 386,319 $ 449,394 Finance lease cost: Depreciation of property SG&A 1,611 184 Interest on lease liabilities Interest expense, net 4,966 1,886 Variable lease cost Cost of sales and SG&A 138,219 152,259 Sublease income SG&A (55,407) (43,922) Total lease cost $ 475,708 $ 559,801 As of February 25, 2023 and February 26, 2022, assets and liabilities related to the Company's operating and finance leases were as follows: (in thousands) Consolidated Balance Sheet Location February 25, 2023 February 26, 2022 Assets Operating leases Operating lease assets $ 965,882 $ 1,562,857 Finance leases Property and equipment, net — 38,790 Total Lease assets $ 965,882 $ 1,601,647 Liabilities Current: Operating leases Current operating lease liabilities $ 301,194 $ 346,506 Finance leases Accrued expenses and other current liabilities 7,048 2,494 Noncurrent: Operating leases Operating lease liabilities 1,278,467 1,508,002 Finance leases Other liabilities 64,052 35,447 Total lease liabilities $ 1,650,761 $ 1,892,449 As of February 25, 2023, the Company's lease liabilities mature as follows: (in thousands) Operating Leases Finance Leases Fiscal Year: 2023 $ 373,985 $ 11,525 2024 355,359 11,525 2025 295,382 11,525 2026 229,674 11,525 2027 183,157 11,525 Thereafter 560,964 48,841 Total lease payments $ 1,998,521 $ 106,466 Less imputed interest (418,860) (35,366) Present value of lease liabilities $ 1,579,661 $ 71,100 The Company's lease terms and discount rates were as follows: February 25, 2023 February 26, 2022 Weighted-average remaining lease term (in years) Operating leases 6.7 years 7.0 years Finance leases 9.5 years 10.0 years Weighted-average discount rate Operating leases 8.3 % 6.0 % Finance leases 8.3 % 8.4 % Other information with respect to the Company's leases is as follows: (in thousands) February 25, 2023 February 26, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 419,553 $ 450,082 Operating cash flows from finance leases 4,448 1,886 Financing cash flows from finance leases 3,206 1,033 Operating lease assets obtained in exchange for new operating lease liabilities 96,669 359,933 Financing lease assets obtained in exchange for new financing lease liabilities 35,030 38,974 In Fiscal 2019, the Company completed a sale-leaseback transaction on approximately 2.1 million square feet of owned real estate, which generated approximately $267.3 million in proceeds. As a result of the transaction, the Company recorded a loss, including transaction costs of approximately $5.7 million, of approximately $33.1 million which is included in selling, general and administrative expenses in the consolidated statement of operations for the fiscal year ended February 27, 2021. All leases entered into as a result of the sale-leaseback transaction were classified as operating leases. For certain assets included in the transaction, the Company determined that the fair value of the assets was less than the consideration received. As a result, the Company recognized a financing obligation in the amount of $14.5 million, for the additional financing obtained from the buyer. As of February 25, 2023 and February 26, 2022, the financing obligation amounted to approximately $19.00 million and $13.0 million, respectively, of which approximately $7.6 million and $0.7 million, respectively, is included in accrued expenses and other current liabilities, and approximately 11.4 million and 12.3 million, respectively, is included in other liabilities, in the consolidated balance sheets. |
Leases | LEASES The Company leases retail stores, as well as distribution facilities, offices and equipment, under agreements expiring at various dates throug h 2041. T he leases provide for original lease terms that generally range from 10 to 15 years and most leases provide for a series of five year renewal options, often at increased rents, the exercise of which is at the Company's sole discretion. Certain leases provide for contingent rents (which are based upon store sales exceeding stipulated amounts and are immaterial in Fiscal 2022, 2021, and 2020), scheduled rent increases and renewal options. The Company is obligated under a majority of the leases to pay for taxes, insurance and common area maintenance charges. The Company subleases certain real estate to unrelated third parties, all of which have been classified as operating leases. The Company recognizes sublease income on a straight-line basis over the sublease term, which generally ranges from 5 to 10 years. Most sublease arrangements provide for a series of five year renewal options, the exercise of which are at the Company's sole discretion. The Company regularly negotiates lease terms with landlords, including in connection with its transformation initiatives. Beginning in the first quarter of Fiscal 2021, in order to maintain liquidity given temporary store closures as a result of the COVID-19 pandemic, the Company withheld portions of and/or delayed or deferred payments to certain landlords, including in connection with renegotiations of lease terms. In some instances, the renegotiations led to agreements with landlords for rent abatements or rental deferrals. In Fiscal 2022, the Company has continued to withhold payments to certain landlords in connection with certain negotiations of payment terms. Total payments withheld and/or delayed or deferred as of February 25, 2023 and February 26, 2022 were approximately $0.2 million and $1.9 million , respectively, and are included in current liabilities. In accordance with the FASB’s Staff Q&A regarding rent concessions related to the effects of the COVID-19 pandemic, the Company has elected to account for the concessions agreed to by landlords that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee as though enforceable rights and obligations for those concessions existed in the original lease agreements and the Company has elected to not remeasure the related lease liabilities and right-of-use assets. For qualifying rent abatement concessions, the Company has recorded negative lease expense for the amount of the concession during the period of relief, and for qualifying deferrals of rental payments, the Company has recognized a non-interest bearing payable in lieu of recognizing a decrease in cash for the lease payment that would have been made based on the original terms of the lease agreement, which will be reduced when the deferred payment is made in the future. During the fiscal year ended February 26, 2022, the Company recognized reduced rent expense of $2.7 million related to rent abatement concessions. The components of total lease cost for the fiscal year ended February 25, 2023 and February 26, 2022 were as follows: (in thousands) Statement of Operations Location February 25, 2023 February 26, 2022 Operating lease cost Cost of sales and SG&A $ 386,319 $ 449,394 Finance lease cost: Depreciation of property SG&A 1,611 184 Interest on lease liabilities Interest expense, net 4,966 1,886 Variable lease cost Cost of sales and SG&A 138,219 152,259 Sublease income SG&A (55,407) (43,922) Total lease cost $ 475,708 $ 559,801 As of February 25, 2023 and February 26, 2022, assets and liabilities related to the Company's operating and finance leases were as follows: (in thousands) Consolidated Balance Sheet Location February 25, 2023 February 26, 2022 Assets Operating leases Operating lease assets $ 965,882 $ 1,562,857 Finance leases Property and equipment, net — 38,790 Total Lease assets $ 965,882 $ 1,601,647 Liabilities Current: Operating leases Current operating lease liabilities $ 301,194 $ 346,506 Finance leases Accrued expenses and other current liabilities 7,048 2,494 Noncurrent: Operating leases Operating lease liabilities 1,278,467 1,508,002 Finance leases Other liabilities 64,052 35,447 Total lease liabilities $ 1,650,761 $ 1,892,449 As of February 25, 2023, the Company's lease liabilities mature as follows: (in thousands) Operating Leases Finance Leases Fiscal Year: 2023 $ 373,985 $ 11,525 2024 355,359 11,525 2025 295,382 11,525 2026 229,674 11,525 2027 183,157 11,525 Thereafter 560,964 48,841 Total lease payments $ 1,998,521 $ 106,466 Less imputed interest (418,860) (35,366) Present value of lease liabilities $ 1,579,661 $ 71,100 The Company's lease terms and discount rates were as follows: February 25, 2023 February 26, 2022 Weighted-average remaining lease term (in years) Operating leases 6.7 years 7.0 years Finance leases 9.5 years 10.0 years Weighted-average discount rate Operating leases 8.3 % 6.0 % Finance leases 8.3 % 8.4 % Other information with respect to the Company's leases is as follows: (in thousands) February 25, 2023 February 26, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 419,553 $ 450,082 Operating cash flows from finance leases 4,448 1,886 Financing cash flows from finance leases 3,206 1,033 Operating lease assets obtained in exchange for new operating lease liabilities 96,669 359,933 Financing lease assets obtained in exchange for new financing lease liabilities 35,030 38,974 In Fiscal 2019, the Company completed a sale-leaseback transaction on approximately 2.1 million square feet of owned real estate, which generated approximately $267.3 million in proceeds. As a result of the transaction, the Company recorded a loss, including transaction costs of approximately $5.7 million, of approximately $33.1 million which is included in selling, general and administrative expenses in the consolidated statement of operations for the fiscal year ended February 27, 2021. All leases entered into as a result of the sale-leaseback transaction were classified as operating leases. For certain assets included in the transaction, the Company determined that the fair value of the assets was less than the consideration received. As a result, the Company recognized a financing obligation in the amount of $14.5 million, for the additional financing obtained from the buyer. As of February 25, 2023 and February 26, 2022, the financing obligation amounted to approximately $19.00 million and $13.0 million, respectively, of which approximately $7.6 million and $0.7 million, respectively, is included in accrued expenses and other current liabilities, and approximately 11.4 million and 12.3 million, respectively, is included in other liabilities, in the consolidated balance sheets. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Feb. 25, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | PROPERTY AND EQUIPMENT Property and equipment consist of the following: (in thousands) February 25, 2023 February 26, 2022 Land and buildings $ 4,750 $ 21,597 Furniture, fixtures and equipment (1) 33,985 594,443 Leasehold improvements — 746,365 Computer equipment and software 11,408 1,494,457 Total 50,143 2,856,862 Less: Accumulated depreciation (1) — (1,829,475) Property and equipment, net $ 50,143 $ 1,027,387 ________________________ (1) $63.6 million of furniture, fixtures and equipment, in assets held under finance leases, were fully impaired in Fiscal 2022. Furniture, fixtures and equipment includes $39.0 million in assets held under finance leases as of February 26, 2022. Accumulated depreciation includes $0.2 million in accumulated depreciation for assets held under finance leases as of February 26, 2022. Depreciation expense was $298.5 million, $292.3 million, $338.7 million in Fiscal 2022, 2021, and 2020, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Feb. 25, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | STOCK-BASED COMPENSATION The Company measures all stock-based compensation awards for employees and non-employee directors using a fair value method and records such expense, net of estimated forfeitures, in its consolidated financial statements. Currently, the Company’s stock-based compensation relates to restricted stock awards, restricted stock units, performance stock units, and stock options. The Company’s restricted stock awards are considered nonvested share awards. Stock-based compensation expense and capitalized stock-based compensation cost for the fiscal year ended February 25, 2023, February 26, 2022, and February 27, 2021 were as follows: (in thousands) February 25, 2023 February 26, 2022 February 27, 2021 Stock-based compensation expense: Equity-classified share-settled awards $ 19,394 $ 35,064 $ 31,600 Liability-classified cash-settled awards $ 1,002 $ — $ — Total stock-based compensation expense $ 20,396 $ 35,064 $ 31,600 Capitalized stock-based compensation cost: Equity-classified share-settled awards $ 817 $ 1,020 $ 800 Liability-classified cash-settled awards $ 41 $ — $ — Total capitalized stock-based compensation cost $ 858 $ 1,020 $ 800 Incentive Compensation Plans The Company may grant awards under the Bed Bath & Beyond 2018 Incentive Compensation Plan (the "2018 Plan") and the Bed Bath & Beyond 2012 Incentive Compensation Plan (the "2012 Plan"). The 2018 Plan includes an aggregate of 4.6 million common shares authorized for issuance of awards permitted under the 2018 Plan, including stock options, stock appreciation rights, restricted stock awards, performance awards and other stock based awards. The 2018 Plan supplements the 2012 Plan, which amended and restated the Bed Bath & Beyond 2004 Incentive Compensation Plan (the "2004 Plan"). The 2012 Plan includes an aggregate of 43.2 million common shares authorized for issuance of awards permitted under the 2012 Plan (similar to the 2018 Plan). Outstanding awards that were covered by the 2004 Plan continue to be in effect under the 2012 Plan. The terms of the 2012 Plan and the 2018 Plan are substantially similar and enable the Company to offer incentive compensation through stock options (whether nonqualified stock options or incentive stock options), restricted stock awards, stock appreciation rights, performance awards and other stock based awards, and cash-based awards. Grants are determined by the Compensation Committee of the Board of Directors of the Company for those awards granted to executive officers, and by the Board of Directors of the Company for awards granted to non-employee directors. Stock option grants generally become exercisable in either three or five equal annual installments beginning one year from the date of grant. Restricted stock awards generally become vested in five to seven equal annual installments beginning one The Company generally issues new shares for stock option exercises, restricted stock awards and vesting of restricted stock units and performance stock units. The 2018 Plan expires in May 2028. The 2012 Plan expires in May 2022. As described in further detail below, in Fiscal 2020 and 2019, the Company granted stock-based awards to certain of the Company’s new executive officers as inducements material to their commencement of employment and entry into an employment agreement with the Company. The inducement awards were made in accordance with Nasdaq Listing Rule 5635(c)(4) and were not made under the 2012 Plan or the 2018 Plan. Restricted Stock Awards Restricted stock awards are issued and measured at fair market value on the date of grant and generally become vested in five to seven equal annual installments beginning one Changes in the Company’s restricted stock awards for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Restricted Shares Weighted Average Grant-Date Fair Unvested restricted stock awards, beginning of period 472 $ 32.38 Granted 392 4.90 Vested (168) 38.44 Forfeited (214) 22.63 Unvested restricted stock awards, end of period 482 $ 12.25 Restricted Stock Units ("RSUs") RSUs are issued and measured at fair market value on the date of grant and generally become vested in one to three equal annual installments beginning one year from the date of grant, subject, in general, to the recipient remaining in the Company’s service on specified vesting dates. RSUs are converted into shares of common stock upon vesting. As of February 25, 2023, unrecognized compensation expense related to the unvested portion of the Company’s RSUs, that will be settled in equity, was $5.5 million, which is expected to be recognized over a weighted average period of 1.4 years. Changes in the Company’s RSUs for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Restricted Stock Units Weighted Average Grant-Date Fair Unvested restricted stock units, beginning of period 2,600 $ 17.07 Granted 262 6.78 Vested (1,414) 15.29 Forfeited (890) 18.04 Unvested restricted stock units, end of period 558 $ 15.20 In May of 2022, the Company determined that the RSU awards issued under its incentive compensation plans in May of 2022 would be settled in cash, rather than in equity. As a result, the awards issued in May of 2022 will be accounted for as a liability and measured at their fair value through their respective vesting periods. As of February 25, 2023, unrecognized compensation expense related to the unvested portion of the Company’s RSUs, that will be settled in cash, was $1.3 million, which is expected to be recognized over a weighted average period of 2.1 years. Changes in the Company’s RSUs that will be settled in cash for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Restricted Stock Units Weighted Average Grant-Date Fair Unvested restricted stock units, beginning of period 57 $ 23.44 Granted 2,356 8.71 Vested (144) 9.89 Forfeited (989) 10.10 Unvested restricted stock units, end of period 1,280 $ 8.17 The liability for the cash-settled RSUs was approximately $0.5 million as of February 25, 2023, and is included in accrued expenses and other current liabilities on the consolidated balance sheet. During Fiscal 2022, the Company paid $0.7 million for cash-settled RSUs. Performance Stock Units ("PSUs") PSUs are issued and measured at fair market value on the date of grant using the following performance periods and performance metrics. The performance metrics generally include one or more of Earnings Before Interest and Taxes ("EBIT"), Total Shareholder Return relative to a peer group ("TSR"), Return on Invested Capital ("ROIC") or Gross Margin Percentage ("GM") compared with the Company's peer groups as determined by the Compensation Committee of the Company's Board of Directors. Fiscal Year Performance Period Performance Metrics Target Achievement Range (%) 2020 3 years TSR 0% - 150% 2021 3 years TSR and GM 0% - 150% 2022 3 years TSR and GM 0% - 200% For the PSUs granted in Fiscal 2019, the three year performance-based tests based on a combination of EBIT margin and ROIC were not met in the first quarter of Fiscal 2022 and therefore, there was no payment of these awards following vesting. Vesting of PSUs awarded to certain of the Company’s executives is dependent on the Company’s achievement of a performance-based test from the date of grant, during the performance period and, assuming achievement of the performance-based test, vest at the end of the performance period noted above, subject, in general, to the executive remaining in the Company’s service on specified vesting dates. PSUs are converted into shares of common stock upon payment following vesting. Upon grant of the PSUs, the Company recognizes compensation expense related to these awards based on the Company’s estimate of the percentage of the award that will be achieved. The Company evaluates the estimate on these awards on a quarterly basis and adjusts compensation expense related to these awards, as appropriate. As of February 25, 2023, there was $5.2 million of unrecognized compensation expense associated with these awards, which is expected to be recognized over a weighted average period of 2.0 years. The fair value of the PSUs granted in Fiscal 2022 for which performance during the three-year period will be based on a relative three-year Total Shareholder Return ("TSR") goal relative to a peer group was estimated on the date of the grant using a Monte Carlo simulation that uses the assumptions noted in the following table. Fiscal Year Ended Monte Carlo Simulation Assumptions February 25, 2023 February 26, 2022 February 27, 2021 Risk Free Interest Rate 3.55 % 0.29 % 0.25 % Expected Dividend Yield — % — % — % Expected Volatility 55.00 % 52.21 % 51.47 % Expected Term (in years) 3 years 3 years 3 years Changes in the Company’s PSUs for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Performance Stock Units Weighted Average Grant-Date Fair Unvested performance stock units, beginning of period 1,298 $ 19.55 Granted 2,143 6.79 Vested (666) 15.81 Forfeited (1,292) 15.49 Unvested performance stock units, end of period 1,483 $ 6.33 Stock Options Stock option grants were issued at fair market value on the date of grant and generally became exercisable in either three or five equal annual installments beginning one year from the date of grant, subject, in general, to the recipient remaining in the Company’s service on specified vesting dates. Option grants expired eight years after the date of grant. All option grants were nonqualified. During the fiscal year ended February 27, 2021, the remaining 822,633 options outstanding were forfeited and there were no options outstanding as of February 27, 2021. For the fiscal years ended February 25, 2023 and February 26, 2022, no stock options were granted. For stock options granted in Fiscal 2019, the fair value of these stock options granted were estimated on the date of grant using a Black-Scholes option-pricing model that used the assumptions noted in the table below. The weighted average fair value for the stock options granted in Fiscal 2019 was $4.18. Fiscal Year Ended Black-Scholes Valuation Assumptions (1) February 29, 2020 Weighted Average Expected Life (in years) (2) 7.6 years Weighted Average Expected Volatility (3) 39.41 % Weighted Average Risk Free Interest Rates (4) 2.39 % Expected Dividend Yield (5) 4.34 % ________________________ (1) Forfeitures were estimated based on historical experience. (2) The expected life of stock options was estimated based on historical experience. (3) Expected volatility was based on the average of historical and implied volatility. The historical volatility was determined by observing actual prices of the Company’s stock over a period commensurate with the expected life of the awards. The implied volatility represented the implied volatility of the Company’s call options, which were actively traded on multiple exchanges, had remaining maturities in excess of twelve months, had market prices close to the exercise prices of the employee stock options and were measured on the stock option grant date. (4) Based on the U.S. Treasury constant maturity interest rate whose term was consistent with the expected life of the stock options. (5) Expected dividend yield was estimated based on anticipated dividend payouts. No stock options were exercised during Fiscal 2022 and 2021. Inducement Awards In Fiscal 2020 and 2019, the Company granted stock-based awards to certain of the Company’s new executive officers as inducements material to their commencement of employment and entry into an employment agreement with the Company. These inducement awards were approved by the Compensation Committee of the Board of Directors of the Company and did not require shareholder approval in accordance with Nasdaq Listing Rule 5635(c)(4). RSUs granted as inducement awards are issued and measured at fair market value on the date of grant and generally become vested in one to three equal annual installments beginning one year from the date of grant, subject, in general, to the recipient remaining in the Company’s service on specified vesting dates. There were 437 unvested RSUs, with a weighted average grant- date fair value of $6.10. Changes in the RSUs granted as inducement awards for the fiscal year ended February 25, 2023 included the vesting of 437 RSUs with a weighted average grant-date fair value of $6.09. On November 4, 2019, in connection with the appointment of the Company’s former President and Chief Executive Officer, the Company also granted inducement awards consisting of 273,735 PSU awards. The PSUs vested over two years, based on performance goals requiring the President and CEO to prepare and deliver to the Board of Directors key objectives and goals for the Company and the strategies and initiatives for the achievement of such objectives and goals, and the President and CEO's provision of updates to the Board of Directors regarding achievement of such goals and objectives. Vesting of the PSUs was also subject, in general, to the President and CEO remaining in the Company’s service through the vesting date of November 4, 2021. On November 2, 2021, the Compensation Committee of the Board of Directors determined that the performance goals established for the awards had been met, and the awards vested in full. Other than with respect to the vesting terms described above for the inducement awards to the Company's President and Chief Executive Officer, inducement awards are generally subject to substantially the same terms and conditions as awards that are made under the 2018 Plan. During Fiscal 2020, the Company granted 816,158 RSUs to executive officers of the Company, pursuant to inducement award agreements. During Fiscal 2021, an executive officer's employment with the Company was terminated and, as a result, 160,255 awards vested in accordance with the terms of the awards. As of February 26, 2022, unrecognized compensation expense related to the unvested portion of the Company's inducement awards was $1.6 million and is expected to be recognized over a weighted average period of 1.2 years. Each inducement award recipient must hold at least fifty percent (50%) of the after-tax shares of common stock received pursuant to the inducement awards until they have satisfied the terms of the Company’s stock ownership guidelines. |
Provision for Income Taxes
Provision for Income Taxes | 12 Months Ended |
Feb. 25, 2023 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | PROVISION FOR INCOME TAXES The components of the (benefit) provision for income taxes are as follows: Fiscal Year Ended (in thousands) February 25, 2023 February 26, 2022 February 27, 2021 Current: Federal $ (19,584) $ (43,740) $ (336,506) State and local (11,485) 3,397 1,211 (31,069) (40,343) (335,295) Deferred: Federal — 73,006 150,861 State and local — 54,304 (1,555) — 127,310 149,306 $ (31,069) $ 86,967 $ (185,989) At February 25, 2023, the Company did not have a net deferred income tax asset due to the Company recording a valuation allowance as discussed below and at February 26, 2022, included in other assets are net deferred income tax assets of $(0.1) million. These amounts represent the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of the Company’s deferred tax assets and liabilities consist of the following: (in thousands) February 25, 2023 February 26, 2022 Deferred tax assets: Inventories $ (1,688) $ 4,077 Operating lease liabilities 396,416 473,397 Insurance 14,077 6,416 Stock-based compensation (1,005) 1,592 Merchandise credits and gift card liabilities 62,300 56,690 Accrued expenses 24,835 23,412 Intangibles 1,585 1,685 Goodwill (351) 90 Carryforwards, NOLs and other tax credits 793,163 189,746 Other (4,920) 34,991 Valuation allowance: $ (908,614) $ (249,529) Deferred tax liabilities: Depreciation (126,324) (146,970) Prepaid expenses (5,292) (1,155) Operating lease assets (222,121) (376,079) Other (22,061) (18,499) $ — $ (136) At February 25, 2023, the Company has federal net operating loss carryforwards of $599.7 million (tax effected), of which $4.6 million will expire between 2025 and 2039, state net operating loss carry forwards of $171.6 million (tax effected), which will expire between 2022 and 2042, California state enterprise zone credit carryforwards of $2.1 million (tax effected), which will expire in 2023, but require taxable income in the enterprise zone to be realizable. In assessing the recoverability of its deferred tax assets, the Company evaluates the available objective positive and negative evidence to estimate whether it is more likely than not that sufficient future taxable income will be generated to permit use of existing deferred tax assets in each taxpaying jurisdiction. For any deferred tax asset in excess of the amount for which it is more likely than not that the Company will realize a benefit, the Company establishes a valuation allowance. A valuation allowance is a non-cash charge, and does not limit the Company's ability to utilize its deferred tax assets, including its ability to utilize tax loss and credit carryforward amounts, against future taxable income. The Company assessed all available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of existing deferred tax assets in each taxpaying jurisdiction. On the basis of this evaluation, as of February 25, 2023 , a valuation allowance of $851.8 million was recorded against the Company's net federal and state deferred tax assets as it is not more likely than not that these assets would be realized. As of February 25, 2023 and February 26, 2022, the Company had also recorded a valuation allowance of $56.8 million and $25.2 million, respectively, relative to the Company's Canadian net deferred tax asset, as the Company did not believe the deferred tax assets in that jurisdiction were more likely than not to be realized. The following table summarizes the activity related to the gross unrecognized tax benefits from uncertain tax positions: (in thousands) February 25, 2023 February 26, 2022 Balance at beginning of year $ 95,518 $ 105,749 Increase/(Decrease) related to current year positions (212) 1,125 Decrease related to prior year positions 485 (1,902) Settlements (2,340) (2,340) Lapse of statute of limitations (1,113) (7,114) Balance at end of year $ 92,338 $ 95,518 Gross unrecognized tax benefits are classified in non-current income taxes payable (or a contra deferred tax asset) on the consolidated balance sheet for uncertain tax positions taken (or expected to be taken) on a tax return. As of February 25, 2023 and February 26, 2022, approximately $92.3 million and $95.5 million, respectively, of gross unrecognized tax benefits would impact the Company’s effective tax rate. As of February 25, 2023 and February 26, 2022, the liability for gross unrecognized tax benefits included approximately $8.8 million and $8.6 million, respectively, of accrued interest. The Company recognizes interest and penalties for unrecognized tax benefits, as applicable, in income tax expense. The Company recorded an increase to accrued interest of approximately $0.3 million for the fiscal year ended February 25, 2023 and a decrease of approximately $0.5 million for the fiscal year ended February 26, 2022 for gross unrecognized tax benefits in the consolidated statement of earnings. The Company anticipates that any adjustments to gross unrecognized tax benefits which will impact income tax expense, due to the expiration of statutes of limitations, could be approximately $5.8 million in the next twelve months. However, actual results could differ from those currently anticipated. As of February 25, 2023, the Company operated in all 50 states, the District of Columbia, Puerto Rico, and Canada, and files income tax returns in the United States and various state, local and international jurisdictions. The Company is currently under examination by the Internal Revenue Service for the tax years 2018 - 2021. The Company is open to examination for state, foreign and local jurisdictions with varying statutes of limitations, generally ranging from 3 to 5 years. The following table summarizes the reconciliation between the effective income tax rate and the federal statutory rate: Fiscal Year Ended February 25, 2023 February 26, 2022 February 27, 2021 Federal statutory rate 21.00 % 21.00 % 21.00 % State income tax rate, net of federal impact 2.66 % 3.87 % 3.94 % Uncertain tax positions — % 2.16 % 1.63 % Goodwill non-deductible impairment charges — % — % — % Tax deficiencies related to stock-based compensation (0.07) % (0.81) % (3.18) % Tax credits 0.03 % 0.38 % 0.41 % CARES Act — % 0.94 % 35.98 % Valuation Allowance (18.94) % (48.01) % (7.74) % Canadian Branch Earnings — % 1.60 % 0.78 % Loss on Warrant Issuance (3.80) % — % — % Other — % 0.47 % 2.35 % 0.88 % (18.40) % 55.17 % On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") was enacted in the United States. The CARES Act is an emergency economic aid package to help mitigate the impact of the COVID-19 pandemic. Among other things, the CARES Act provides certain changes to tax laws, As of February 27, 2021, the Company had deferred $3.1 million of employer payroll taxes, which were deposited by December 2021. In addition, during Fiscal 2021 and 2020, the Company recorded credits of approximately $7.8 million and $33.3 million, respectively, as an offset to selling, general and administrative expenses as a result of the employee retention credits and rent and property expense support made available under the CARES Act for U.S. employees and under the Canada Emergency Wage Subsidy for Canadian employees and the Canada Emergency Rent Subsidy. During the fiscal years ended February 26, 2022 and February 27, 2021 under the CARES Act, the Company recorded income tax benefits of $18.7 million and $152.0 million, respectively, as a result of the Fiscal 2020 and Fiscal 2019 net operating losses that were carried back to prior years during which the federal tax rate was 35%. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Feb. 25, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS Defined Contribution Plans The Company has three defined contribution savings plans covering all eligible employees of the Company (the "Plans"). Participants of the Plans may defer annual pre-tax compensation subject to statutory and Plan limitations. In addition, a certain percentage of an employee’s contributions are matched by the Company and vest over a specified period of time, subject to certain statutory and Plan limitations. The Company did not match employee contributions for Fiscal 2022. The Company’s match was approximately $6.2 million, and $10.6 million for Fiscal 2021 and 2020, respectively, which was expensed as incurred. Defined Benefit Plan During Fiscal 2020, upon the divestiture of CTS, the Company retained liability for a non-contributory defined benefit pension plan for CTS employees hired on or before July 31, 2003, who met specified age and length-of-service requirements. During Fiscal 2021, the Company received final approval to terminate the plan, upon which the Company contributed $5.1 million to the plan. Using plan assets, the Company purchased a non-participating group annuity contract for certain participants and made lump sum distributions to all remaining participants. Net periodic pension cost included in the consolidated statement of operations includes the pre-tax release of $13.5 million from other comprehensive income in connection with the settlement of the plan, which is recorded within loss on sale of businesses. As of February 25, 2023, the Company had no liability remaining related to the plan. During Fiscal 2020, the Company released $2.1 million from other comprehensive income in connection with the partial settlement of the plan, recorded within loss on sale of businesses, including impairment of assets held for sale, in the consolidated statements of operations. In addition, as of February 26, 2022, the Company recognized a loss of $8.4 million, net of tax of $3.0 million, within accumulated other comprehensive loss. As of February 26, 2022, the Company had liabilities of $3.6 million, which is included in other liabilities in the Company's consolidated balance sheets. The remaining net periodic pension cost recorded during Fiscal 2022, 2021, and 2020 was not material to the Company’s results of operations. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Feb. 25, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | SUPPLEMENTAL CASH FLOW INFORMATION The Company paid income taxes of $5.4 million, $5.2 million, and $4.8 million in Fiscal 2022, 2021, and 2020, respectively. In addition, the Company had interest payments of approximately $61.3 million, $66.0 million, and $75.5 million in Fiscal 2022, 2021, and 2020, respectively. In Fiscal 2022 and Fiscal 2021, the Company acquired property, plant and equipment of approximately $35.0 million and $39.0 million under finance lease arrangements, respectively. The Company recorded an accrual for capital expenditures of $63.4 million, and $44.6 million as of February 26, 2022, and February 27, 2021, respectively. There was no accrual for capital expenditures as of February 25, 2023. In addition, the Company recorded an accrual for dividends payable of $0.3 million, $0.9 million, $2.1 million as of February 25, 2023, February 26, 2022, and February 27, 2021, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Feb. 25, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES On April 23, 2023, the Debtors filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court. As a result of such bankruptcy filings, substantially all proceedings pending against the Debtors have been stayed by operation of Section 362(a) of the Bankruptcy Code. A putative securities class action was filed on April 14, 2020 against the Company and three of its officers and/or directors (Mark Tritton (the Company's former President and Chief Executive Officer), Mary Winston (the Company’s former Interim Chief Executive Officer) and Robyn D’Elia (the Company’s former Chief Financial Officer and Treasurer)) in the United States District Court for the District of New Jersey (the "New Jersey federal court"). The case, which is captioned Vitiello v. Bed Bath & Beyond Inc., et al. , Case No. 2:20-cv-04240-MCA-MAH, asserts claims under §§ 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") on behalf of a putative class of purchasers of the Company’s securities from October 2, 2019 through February 11, 2020. The Complaint alleges that certain of the Company’s disclosures about financial performance and certain other public statements during the putative class period were materially false or misleading. A similar putative securities class action, asserting the same claims on behalf of the same putative class against the same defendants, was filed on April 30, 2020. That case, captioned Kirkland v. Bed Bath & Beyond Inc., et al. , Case No. 1:20-cv-05339-MCA-MAH, is also pending in the United States District Court for the District of New Jersey. On August 14, 2020, the court consolidated the two cases and appointed Kavin Bakhda as lead plaintiff pursuant to the Private Securities Litigation Reform Act of 1995 (as consolidated, the "Securities Class Action"). Lead plaintiff and additional named plaintiff Richard Lipka filed an Amended Class Action Complaint on October 20, 2020, on behalf of a putative class of purchasers of the Company’s securities from September 4, 2019 through February 11, 2020. Defendants moved to dismiss the Amended Complaint on December 21, 2020. After a mediation held in August 2021, a settlement in principle was reached between the Company and lead plaintiff in the Securities Class Action. The settlement has been executed and was preliminarily approved by the New Jersey Federal Court in February 2022. The court granted final approval to the settlement and dismissed the Securities Class Action on June 2, 2022. The Company had previously recorded a liability for the Securities Class Action, based on the agreed settlement amount and insurance coverage available and this amount was paid by the insurance company in the second fiscal quarter of 2022. On July 10, 2020, the first of three related shareholder derivative actions was filed in the New Jersey federal court on behalf of the Company against various present and former directors and officers. The case, which is captioned Salu v. Tritton, et al. , Case No. 2:20-cv-08673-MCA-MAH (D.N.J.), asserts claims under §§ 10(b) and 20(a) of the Exchange Act and for breach of fiduciary duty, unjust enrichment, and waste of corporate assets under state law arising from the events underlying the securities class actions described above and from the Company’s repurchases of its own shares during the class period pled in the securities cases. The two other derivative actions, which assert similar claims, are captioned Grooms v. Tritton, et al. , Case No. 2:20-cv-09610-SDW-RDW (D.N.J.) (filed July 29, 2020), and Mantia v. Fleming, et al. , Case No. 2:20-cv-09763-MCA-MAH (D.N.J.) (filed July 31, 2020). On August 5, 2020, the court signed a stipulation by the parties in the Salu case to stay that action pending disposition of a motion to dismiss in the Securities Class Action, subject to various terms outlined in the stipulation. The parties in all three derivative cases have moved to consolidate them and to apply the Salu stay of proceedings to all three actions. The court granted the motion on October 14, 2020, but the stay was subsequently lifted. On January 4, 2022, the defendants filed a motion to dismiss this case. On August 28, 2020, another related shareholder derivative action, captioned Schneider v. Tritton , et al., Index No 516051/2020, was filed in the Supreme Court of the State of New York, County of Kings. The claims pled in the Schneider case are similar to those pled in the three federal derivative cases, except that the Schneider complaint does not plead claims under the Exchange Act. On September 21, 2020, the parties filed a stipulation seeking to stay that action pending disposition of a motion to dismiss in the securities class action, subject to various terms and conditions. On June 11, 2021, an additional related derivative action was filed on behalf of the Company against certain present and former directors and officers. This Complaint is entitled Michael Anthony v Mark Tritton et. al. , Index No. 514167/2021 and was filed in the Supreme Court of the State of New York, Kings County. The claims are essentially the same as in the other two derivative actions. On October 26, 2021, the court consolidated the Schneider and Anthony actions, and the plaintiffs subsequently filed a consolidated complaint. On January 10, 2022, the defendants filed a motion to dismiss this case. The derivative cases were not included in the August 2021 settlement referred to above, but after mediation, a settlement in principle was reached in the first quarter of Fiscal 2022. The settlement has been executed and was preliminarily approved by the New York State Court in June 2022. The court granted final approval to the settlement on September 21, 2022 and the settlement amount has been paid by the Company’s insurer. In connection with the sale of PMall (see "Assets Held for Sale and Divestitures", Note 16), the Company agreed to indemnify 1-800-FLOWERS.COM for certain litigation matters then existing at the time of the close of the transaction, including certain matters for which the Company is entitled to indemnification from the former owner of PMall in connection with the Company's purchase of PMall in Fiscal 2016. During Fiscal 2021, the Company recorded a liability for one such matter and a corresponding asset based on the Company's assessment of the ability to recover the expected loss under the indemnification provided at the time of its purchase of PMall. On August 23, 2022, a putative securities class action and shareholder derivative action was filed against the Company, Gustavo Arnal (the Company's former Chief Financial Officer), and certain third parties in the United States District Court for the District of Columbia. The case, which is captioned Si v. Bed Bath & Beyond Corp., et al., Case No. 2:22-cv-02541, asserts claims of breach of fiduciary duty, negligent misrepresentation, and violations of §§ 10(b) and 20(a) of the Exchange Act on behalf of a putative class of purchasers of our securities from March 25, 2022 through August 18, 2022. The Complaint alleges that certain of our disclosures about the Company's revenue and proposed divestments, as well as other disclosures made by certain of our investors about their holdings, during the putative class period were materially false or misleading. The Complaint was amended in November 2022 and again in January 2023 and a Lead Plaintiff was appointed by the Court. The Second Amended Complaint removes Mr. Arnal as a defendant, adds Sue Gove as a defendant, and shortens the class period and reduced the claims against the Company. The matter is now entitled In re Bed Bath & Beyond Corporation Securities Litigation. Based on current knowledge the Company believes the claims are without merit and has filed a Motion to Dismiss the Complaint. The Company records an estimated liability related to its various claims and legal actions arising in the ordinary course of business when and to the extent that it concludes a liability is probable and the amount of the loss can be reasonably estimated. Such estimated loss is based on available information and advice from outside counsel, where appropriate. As additional information becomes available, the Company reassesses the potential liability related to claims and legal actions and revises its estimated liabilities, as appropriate. The Company expects the ultimate disposition of these matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or liquidity. The Company also cannot predict the nature and validity of claims which could be asserted in the future, and future claims could have a material impact on its earnings. |
Assets Held for Sale and Divest
Assets Held for Sale and Divestitures | 12 Months Ended |
Feb. 25, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Assets Held for Sale and Divestitures | ASSETS HELD FOR SALE AND DIVESTITURES Assets Held for Sale The Company has included businesses classified as held for sale within its continuing operations as their dispositions do not represent a strategic shift that will have a major effect on the Company’s operations and financial results. As of February 25, 2023 and February 26, 2022 , the Company did not have any businesses classified as held for sale. Prior to the end of Fiscal 2020, certain assets and liabilities of Cost Plus World Market, Personalization Mall.com ("PMall") and One Kings Lane ("OKL") were classified as held for sale on the Company's consolidated balance sheet. CPWM, PMall, and OKL were sold during Fiscal 2020, as further described below. Divestitures Cost Plus World Market. On December 14, 2020, the Company announced that it entered into a definitive agreement to sell Cost Plus World Market to Kingswood Capital Management. On January 15, 2021, the Company completed the sale of Cost Plus World Market. Proceeds from the sale were approximately $63.7 million, subject to certain working capital and other adjustments. The Company recognized a loss on sale of approximately $72.0 million in loss on sale of businesses including impairment of assets held for sale in its consolidated statements of operations for the fiscal year ended February 27, 2021. The $72.0 million loss on sale includes an impairment of $54.0 million recorded in the third quarter of Fiscal 2020 to remeasure the disposal group that was classified as held for sale to the lower of carrying value or fair value less costs to sell, recorded in impairments, including on assets held for sale. Christmas Tree Shops. On October 11, 2020, the Company entered into definitive agreements to sell Christmas Tree Shops ("CTS") to Handil Holdings LLC and to sell one of the CTS distribution facilities to an institutional buyer, with a leaseback term of nine months, to provide business continuity to the Company for some of its operations currently using the facility. These transactions were completed during the third quarter of Fiscal 2021, generating approximately $233.3 million in proceeds, subject to certain working capital and other adjustments, and the Company recognized a loss on sale of approximately $53.8 million, which was recorded in loss on sale of businesses including impairment of assets held for sale in its consolidated statements of operations for the fiscal year ended February 27, 2021. In Fiscal 2021, the Company recorded an additional loss of sale of CTS of $13.5 million related to the settlement of the CTS Pension Plan. Linen Holdings. On October 11, 2020, the Company entered into a definitive agreement to sell Linen Holdings to The Linen Group, LLC, an affiliate of Lion Equity Partners. On October 24, 2020, the Company completed the sale of Linen Holdings for approximately $10.1 million, subject to certain working capital and other adjustments, and recognized a loss on the sale of $64.6 million, which was recorded in loss on sale of businesses including impairment of assets held for sale in its consolidated statements of operations for the fiscal year ended February 27, 2021. PersonalizationMall.com. On February 14, 2020, the Company entered into a definitive agreement to sell PersonalizationMall.com ("PMall") to 1-800-FLOWERS.COM, Inc. for $252.0 million, subject to certain working capital and other adjustments. The buyer was required to close the transaction on March 30, 2020, but failed to do so. Accordingly, the Company had filed an action to require the buyer to close the transaction. On July 20, 2020, the Company entered into a settlement agreement with respect to the litigation. Under this agreement, 1-800-FLOWERS.COM agreed to move forward with its purchase of PMall from the Company for $245.0 million, subject to certain working capital and other adjustments. The transaction closed on August 3, 2020. Net proceeds from the sale of PMall were $244.6 million , subject to certain working capital and other adjustments, and the Company recognized a gain on the sale of approximately $189.3 million , which was recorded in loss on sale of businesses including impairment of assets held for sale in its consolidated statement of operations for the fiscal year ended February 27, 2021. Upon the close of the transaction, Bed Bath & Beyond withdrew the litigation against 1-800-FLOWERS.COM and 800-FLOWERS, INC. In connection with the sale of PMall, the Company agreed to indemnify 1-800-FLOWERS.COM for certain litigation matters then existing at the time of the close of the transaction, including certain matters for which the Company is entitled to indemnification from the former owner of PMall in connection with the Company's purchase of PMall in Fiscal 2016 (see "Commitments and Contingencies" Note 15 for additional information.) One Kings Lane. On April 13, 2020, the Company completed the sale of One Kings Lane ("OKL"). Proceeds from the sale were not material. During the fiscal year ended February 26, 2022, the Company recognized approximately $18.2 million of loss on the sale of these businesses primarily associated with the Fiscal 2021 settlement of the CTS pension plan (see "Employee Benefit Plans" Note 13) and certain working capital and other adjustments related to the above divestitures. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Feb. 25, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Chapter 11 Cases On April 23, 2023, (the “Petition Date”), the Company and certain of its direct and indirect subsidiaries (collectively, the “Debtors” or the “Company Parties”) filed voluntary petitions (the “Chapter 11 Cases”) under Chapter 11 of the U.S. Bankruptcy Code (the “Bankruptcy Code”) in the U.S. Bankruptcy Court for the District of New Jersey (the “Bankruptcy Court”). On the Petition Date, the Company Parties filed a motion with the Bankruptcy Court seeking to jointly administer the Chapter 11 Cases. On April 24, 2023, the Bankruptcy Court entered an order approving joint administration under the caption “In re Bed Bath & Beyond Inc. , ” Case No. 23-13359. Certain of the Company’s subsidiaries were not included in the Chapter 11 filing. The Company Parties continue to operate their business and manage their properties as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. The Company Parties filed with the Bankruptcy Court motions seeking a variety of “first-day” relief, including authority to pay employee wages and benefits and to pay vendors and suppliers for goods and services provided both before and after the Petition Date. In addition, the Company filed with the Bankruptcy Court a motion seeking approval (“Interim DIP Order”) of debtor-in-possession financing (“DIP Financing”) in the form of the DIP Credit Agreement (as defined and described below). Following a hearing held on April 24, 2023, the Bankruptcy Court approved the Company Parties’ motions seeking a variety of “first-day” relief on an interim basis for. The Company Parties resolved numerous informal comments and many of the "first-day" motions were entered on a final basis consensually. A hearing is scheduled on June 14, 2023 for the Bankruptcy Court to consider final approval of the relief requested in certain first day motions, and final approval of the DIP Facility. DIP Credit Agreement Prior to the Petition Date, the Company Parties and Sixth Street Specialty Lending, Inc., Sixth Street Lending Partners and TAO Talents (the “DIP Parties”) agreed to enter into a senior secured super-priority debtor-in-possession term loan credit facility in an aggregate principal amount of $240.0 million subject to the terms and conditions set forth therein (the “DIP Credit Agreement”). On April 24, 2023, the Bankruptcy Court entered an order approving entry into the DIP Credit Facility on an interim basis. Pursuant to the DIP Credit Agreement, the DIP Lenders have provided a senior secured super-priority debtor in possession term loan facility (the “DIP Facility”), consisting of (1) a new money single draw term loan facility in the amount of $40.0 million, and (2) a roll-up of certain secured obligations under the existing prepetition credit agreement between the Company Parties and the Prepetition FILO Lenders in the amount of $200.0 million. Borrowings under the DIP Facility are senior secured obligations of the Company and certain Company Parties, secured by a super priority lien on the collateral under the Amended and Restated Credit Agreement, dated as of August 9, 2021 (as amended by that certain First Amendment to Amended and Restated Credit Agreement, dated as of August 31, 2022, that certain Second Amendment to Amended and Restated Credit Agreement and Waiver, dated as of February 7, 2023, that certain Third Amendment to Amended and Restated Credit Agreement and Waiver, dated as of March 6, 2023, that certain Fourth Amendment to Amended and Restated Credit Agreement and Waiver, dated as of March 30, 2023, that certain Fifth Amendment to Amended and Restated Credit Agreement and Waiver, dated as of April 6, 2023 and that certain Sixth Amendment to Amended and Restated Credit Agreement, Consent and Waiver, dated as of April 21, 2023, the “Existing Credit Agreement”), as well as all unencumbered assets of the Company Parties (subject to customary exceptions). The DIP Credit Agreement has various customary covenants, as well as covenants mandating compliance by the Debtors with a 13-week budget, variance testing and reporting requirements, among others. The proceeds of all or a portion of the proposed DIP Credit Agreements may be used for, among other things, post-petition working capital for the Company and its subsidiaries, payment of costs to administer the Chapter 11 Cases, payment of expenses and fees of the transactions contemplated by the Chapter 11 Cases, payment of court-approved adequate protection obligations under the DIP Credit Agreements, and payment of other costs, in each case, subject to an approved budget and such other purposes permitted under the DIP Credit Agreement and the Interim DIP Order or any other order of the Bankruptcy Court. The Interim DIP Order provides certain milestones for the Chapter 11 Cases. Failure of the Debtors to satisfy these milestones without a waiver or consensual amendment would provide the Required DIP Lenders a termination right under the Interim DIP Order. These milestones include (i) the entry of an order approving the sale(s) of all or substantially all of the Debtors’ assets, (ii) the filing of a Chapter 11 plan and disclosure statement, in form and substance acceptable to the Required DIP Lenders (iii) the entry of an order confirming the Chapter 11 plan within 120 days after the Petition Date The Debtors have satisfied the first milestone as of the filing of these financial statements. Adequate Protection Pursuant to the Interim DIP Order, we are obligated to make certain adequate protection payments during our bankruptcy proceedings on each of our Prepetition Secured Obligations. The Prepetition Secured Obligations are each entitled to receive adequate protection as set forth to the extent of Diminution in Value of their respective interests in the Prepetition Collateral. Nasdaq Delisting Proceedings On April 24, the Company received written notice from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, as a result of the Chapter 11 Cases and in accordance with the Nasdaq Listing Rules 5101, 5110(b) and IM-5101-1, Nasdaq had determined that the Company’s common stock will be delisted from Nasdaq. Trading of the Company’s common stock was suspended at the opening of business on May 3, 2023. Following delisting from Nasdaq, the Company’s common stock has been quoted in the OTC Pink Open Market under the symbol “BBBYQ”. The OTC Pink Open Market is a significantly more limited market than Nasdaq, and quotation on the OTC Pink Open Market likely results in a less liquid market for existing and potential holders of the common stock to trade the Company’s common stock and could further depress the trading price of the common stock. The Company can provide no assurance as to whether broker-dealers will continue to provide public quotes of the common stock on this market, or whether the trading volume of the common stock will be sufficient to provide for an efficient trading market. We expect Nasdaq to file a Form 25 with the SEC to delist our common stock from trading on Nasdaq and to remove it from registration under Section 12(b) of the Exchange Act. The delisting became effective 10 days after such filing. In accordance with Rule 12d2-2 of the Exchange Act, the de-registration of our common stock under Section 12(b) of the Exchange Act will become effective 90 days, or such shorter period as the SEC may determine, from the date of the Form 25 filing. Potential Claims The Debtors have filed with the Bankruptcy Court schedules and statements setting forth, among other things, the assets and liabilities of each of the Debtors , subject to the assumptions filed in connection therewith. These schedules and statements may be subject to further amendment or modification after filing. Certain holders of pre-petition claims that are not governmental units are required to file proofs of claim by the deadline for general claims, which is currently expected to be June 30, 2023 (the “Bar Date”). The Debtors' have received approximately 2,413 proofs of claim, primarily representing general unsecured claims, for an amount of approximately $181.7 million. These claims will be reconciled to amounts recorded in the Company's accounting records. Differences in amounts recorded and claims filed by creditors will be investigated and resolved, including through the filing of objections with the Bankruptcy Court, where appropriate. The Company may ask the Bankruptcy Court to disallow claims that the Company believes are duplicative, have been later amended or superseded, are without merit, are overstated or should be disallowed for other reasons. In addition, as a result of this process, the Company may identify additional liabilities that will need to be recorded or reclassified to Liabilities subject to compromise. In light of the substantial number of claims filed, and expected to be filed, the claims resolution process may take considerable time to complete and likely will continue after the Debtors emerge from bankruptcy. Rejected Executory Contracts and Leases Subject to certain exceptions, under the Bankruptcy Code, the Company Parties may assume, assign, or reject certain executory contracts and unexpired leases subject to the approval of the Bankruptcy Court and certain other conditions. Generally, the rejection of an executory contract or unexpired lease is treated as a pre-petition breach of such executory contract or unexpired lease and, subject to certain exceptions, relieves the Company Parties from performing their future obligations under such executory contract or unexpired lease but entitles the contract counterparty or lessor to a pre-petition general unsecured claim for damages caused by such deemed breach. Generally, the assumption of an executory contract or unexpired lease requires the Company Parties to cure existing monetary defaults under such executory contract or unexpired lease and provide adequate assurance of future performance. Accordingly, any description of an executory contract or unexpired lease with the Company Parties discussed herein, including a quantification of the Company Parties’ obligations under any such executory contract or unexpired lease, is qualified by any overriding rejection rights the Company Parties have under the Bankruptcy Code. Delisting of Our Common Stock form Nasdaq In connection with the Chapter 11 Cases, on April 24, 2023, the Company received written notice (the “Delisting Notice”) from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, as a result of the Chapter 11 Cases and in accordance with Nasdaq Listing Rules 5101, 5110(b) and IM-5101-1, Nasdaq had determined that the Company’s common stock will be delisted from Nasdaq. The Company did not intend to appeal this determination. Trading of the Company’s common stock was suspended at the opening of business on May 3, 2023. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Feb. 25, 2023 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | Schedule II - Valuation and Qualifying Accounts Fiscal Years Ended February 25, 2023, February 26, 2022, and February 27, 2021 (amounts in millions) Column A Column B Column C Column D Column E Description Balance at Beginning of Additions Charged to Adjustments and/or Deductions Balance at End of Period Sales Returns and Allowance Year Ended: February 25, 2023 $ 22.2 $ 101.0 $ (116.2) $ 7.0 February 26, 2022 36.2 227.1 (241.1) 22.2 February 27, 2021 71.6 259.8 (295.2) 36.2 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Related Matters (Policies) | 12 Months Ended |
Feb. 25, 2023 | |
Accounting Policies [Abstract] | |
Fiscal Year | Fiscal YearThe Company’s Fiscal year is comprised of the 52 or 53-week period ending on the Saturday nearest February 28th. Accordingly, Fiscal 2022, Fiscal 2021, and Fiscal 2020 represented 52 weeks and ended on February 25, 2023, February 26, 2022, and February 27, 2021, respectively. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. The Company accounts for its investment in the joint venture referred to above under the equity method. All significant intercompany balances and transactions have been eliminated in consolidation. |
Recent Accounting Pronouncements | Recent Accounting PronouncementsIn March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04 Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendment provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on contracts, hedging relationships and other transactions that reference LIBOR. These updates are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company adopted this standard in Fiscal 2022; upon adoption, this guidance did not have a material impact on its consolidated financial statements. |
Use of Estimates | Use of EstimatesThe preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires the Company to establish accounting policies and to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on other assumptions that it believes to be relevant under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. In particular, judgment is used in areas such as inventory valuation, impairment of long-lived assets, impairment of auction rate securities, goodwill and other indefinite lived intangible assets, accruals for self-insurance, litigation, store opening, expansion, relocation and closing costs, the provision for sales returns, vendor allowances, derivatives, stock-based compensation and income and certain other taxes. Actual results could differ from these estimates. |
Cash and Cash Equivalents | Cash and Cash EquivalentsThe Company considers all highly liquid instruments purchased with original maturities of three months or less to be cash equivalents. Included in cash and cash equivalents are credit and debit card receivables from banks, which typically settle within five business days, of $24.5 million and $47.9 million as of February 25, 2023 and February 26, 2022, respectively. |
Investment Securities | Investment Securities Investment securities consist primarily of auction rate securities, which are securities with interest rates that reset periodically through an auction process, and U.S. Treasury Bills, when outstanding. The U.S. Treasury Bills with original maturities of greater than three months were classified as short-term held-to-maturity securities and stated at their amortized cost which approximated fair value. Auction rate securities are classified as available-for-sale and are stated at fair value, which had historically been consistent with cost or par value due to interest rates which reset periodically, typically every 7, 28 or 35 days. As a result, there generally were no cumulative gross unrealized holding gains or losses relating to these auction rate securities. However, during the global financial crisis of 2008 the auction process for the Company’s auction rate securities failed and continues to fail. These failed auctions result in a lack of liquidity in the securities and affect their estimated fair values at February 26, 2022, but do not affect the underlying collateral of the securities. Those investment securities which the Company had the ability and intent to hold until maturity are classified as held-to-maturity investments and are stated at amortized cost. Premiums are amortized and discounts are accreted over the life of the security as adjustments to interest income using the effective interest method. Dividend and interest income are recognized when earned. During Fiscal 2022, the Company sold its long-term available-for-sale investment securities of $20.3 million for $18.9 million resulting in a $1.4 million realized loss, of which $1.1 million was reclassified out of accumulated other comprehensive loss. As of February 26, 2021, the Company’s long-term available-for-sale investment securities represented approximately $20.3 million par value of auction rate securities, less temporary valuation adjustments of approximately $1.1 million. Since these valuation adjustments are deemed to be temporary, they are recorded in accumulated other comprehensive loss, net of a related tax benefit, and did not affect the Company’s net earnings. The Company had no short-term available-for-sale investment securities as of February 25, 2023 or February 26, 2022. |
Inventory Valuation | Inventory Valuation Merchandise inventories are stated at the lower of cost or market. Inventory costs are primarily calculated using the weighted average retail inventory method. Under the retail inventory method, the valuation of inventories at cost and the resulting gross margins are calculated by applying a cost-to-retail ratio to the retail values of inventories. The inputs associated with determining the cost-to-retail ratio include: merchandise purchases, net of returns to vendors, discounts and volume and incentive rebates; inbound freight expenses; and import charges, including duties, insurance and commissions. The retail inventory method contains certain management judgments that may affect inventory valuation. At any one time, inventories include items that have been written down to the Company’s best estimate of their realizable value. Judgment is required in estimating realizable value and factors considered are the age of merchandise, anticipated demand based on factors such as customer preferences and fashion trends, and anticipated changes in product assortment (including related to the launch of Owned Brands) as well as anticipated markdowns to reduce the price of merchandise from its recorded retail price to a retail price at which it is expected to be sold in the future. These estimates are based on historical experience and current information about future events which are inherently uncertain. Actual realizable value could differ materially from this estimate based upon future customer demand or economic conditions. For the fiscal years ended February 26, 2022 and February 27, 2021, the Company estimated its reserve for inventory shrinkage throughout the year based on historical shrinkage and any current trends, if applicable. Actual shrinkage was recorded based upon the results of the Company’s physical inventory counts for locations at which counts were conducted. For locations where physical inventory counts were not conducted in the fiscal year, an estimated shrink reserve was recorded based on historical shrinkage and any current trends, if applicable. For the fiscal year-ended February 25, 2023 the Company performed store physical inventory counts at or near fiscal year-end using a statistical sampling approach based on a stratified random sample. The full population of store inventory was estimated and recorded based on an extrapolation using the direct projection method. The Company estimated a reserve for inventory shrinkage for inventory held at other locations based on historical shrinkage and current trends. The Company accrues for merchandise in transit once it takes legal ownership and title to the merchandise; as such, an estimate for merchandise in transit is included in the Company’s merchandise inventories. |
Property and Equipment | Property and EquipmentProperty and equipment are stated at cost and are depreciated primarily using the straight-line method over the estimated useful lives of the assets (39 years for buildings; 7 to 20 years for furniture, fixtures and equipment; and 3 to 10 years for computer equipment and software). Leasehold improvements are amortized using the straight-line method over the lesser of their estimated useful life or the life of the lease. Depreciation expense is primarily included within selling, general and administrative expenses. (see "Property and Equipment," Note 10).The cost of maintenance and repairs is charged to earnings as incurred; significant renewals and betterments are capitalized. |
Impairment of Long-Lived Assets | Impairment of Long-Lived AssetsThe Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying value of these assets may exceed their current fair values. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. In Fiscal 2022 and Fiscal 2021, the Company recorded non-cash pre-tax impairment charges respectively, for certain store-level, distribution facilities, corporate assets, including leasehold improvements, other property and equipment and operating lease assets. At February 25, 2023, the required step one recoverability test resulted in estimation uncertainty regarding the ability to achieve future location and enterprise level positive undiscounted cash flows. As such, the Company moved forward with preparing a step two impairment test for its long-lived assets at all store, distribution facility and corporate locations. The Company used market approach models, including orderly liquidation value, to estimate the fair value of store, distribution facility and corporate location long-lived assets, comparing the fair values to the net book values, and calculating the impairment charge. In the future, if events or market conditions affect the estimated fair value to the extent that a long-lived asset is impaired, the Company will adjust the carrying value of these long-lived assets in the period in which the impairment occurs. |
Goodwill and Other Indefinite Lived Intangible Assets | Goodwill and Other Indefinite Lived Intangible Assets Included within other assets in the accompanying consolidated balance sheets as of February 25, 2023 and February 26, 2022, respectively, are $13.2 million and $16.3 million for indefinite lived tradenames and trademarks. The Company reviews its intangible assets that have indefinite lives for impairment annually as of the end of the fiscal year or when events or changes in circumstances indicate the carrying value of these assets might exceed their current fair values. Impairment testing is based upon the best information available including estimates of fair value which incorporate assumptions marketplace participants would use in making their estimates of fair value. Significant assumptions and estimates are required, including, but not limited to, projecting future cash flows, determining appropriate discount rates and terminal growth rates, and other assumptions, to estimate the fair value of goodwill and indefinite lived intangible assets. Although the Company believes the assumptions and estimates made are reasonable and appropriate, different assumptions and estimates could materially impact its reported financial results. Other indefinite lived intangible assets were recorded as a result of acquisitions and primarily consist of tradenames. The Company values its tradenames using a relief-from-royalty approach, which assumes the value of the tradename is the discounted cash flows of the amount that would be paid by a hypothetical market participant had they not owned the tradename and instead licensed the tradename from another company. For the fiscal years ended February 25, 2023, February 26, 2022, and February 27, 2021, the Company completed a quantitative impairment analysis for certain other indefinite lived intangible assets, by comparing the fair value of the tradenames to their carrying value and recognized non-cash pre-tax tradename impairment charges of $2.9 million, $5.7 million, and $35.1 million, respectively, within goodwill and other impairments As of February 25, 2023, for the remaining other indefinite lived intangible assets, the Company assessed qualitative factors in order to determine whether any events and circumstances existed which indicated that it was more likely than not that the fair value of these other indefinite lived assets did not exceed their carrying values and concluded no such events or circumstances existed which would require an impairment test be performed. In the future, if events or market conditions affect the estimated fair value to the extent that an asset is impaired, the Company will adjust the carrying value of these assets in the period in which the impairment occurs. As of February 25, 2023 and February 26, 2022, the Company did not have any goodwill recorded on its consolidated balance sheet. |
Self-Insurance | Self-InsuranceThe Company utilizes a combination of insurance and self-insurance for a number of risks including workers’ compensation, general liability, cyber liability, property liability, automobile liability and employee related health care benefits (a portion of which is paid by its employees). Liabilities associated with the risks that the Company retains are not discounted and are estimated by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. Although the Company’s claims experience has not displayed substantial volatility in the past, actual experience could materially vary from its historical experience in the future. Factors that affect these estimates include but are not limited to: inflation, the number and severity of claims and regulatory changes. In the future, if the Company concludes an adjustment to self-insurance accruals is required, the liability will be adjusted accordingly.Beginning in the fourth quarter of Fiscal 2020, the Company began insuring portions of its workers' compensation and medical insurance through a wholly owned captive insurance subsidiary (the "Captive") to enhance its risk financing strategies. The Captive is subject to regulations in Vermont, including those relating to its levels of liquidity and other requirements. |
Shareholders' (Deficit) Equity and Mezzanine Equity | Shareholders' (Deficit) Equity and Mezzanine Equity The Company has authorization to make repurchases of its common shares from time to time in the open market or through other programs approved by the Board of Directors pursuant to existing rules and regulations. Common stock purchased for treasury is recorded at cost. At the date of subsequent reissue, the treasury stock account is reduced by the cost of such stock, with cost determined on a weighted-average basis (see "Shareholders' (Deficit) Equity and Mezzanine Equity", Note 8). The Company issues various financial instruments, including preferred stock. Instruments containing redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control are classified as redeemable or mezzanine equity. The Company evaluates whether the contingent redemption provisions are probable of becoming redeemable to determine whether the carrying value of the redeemable convertible preferred units are required to be remeasured to their respective redemption values. All instruments that are classified as mezzanine equity are evaluated for embedded derivative features by evaluating each feature against the nature of the host instrument (e.g. more equity-like or debt-like). Features identified as freestanding instruments or bifurcated embedded derivatives that are material are recognized separately as a derivative asset or liability in the consolidated financial statements (see "Shareholders' (Deficit) Equity and Mezzanine Equity", Note 8). |
Fair Value of Financial Instruments | Fair Value of Financial InstrumentsThe Company’s financial instruments include cash and cash equivalents, investment securities, accounts payable, long-term debt, derivatives, and certain other liabilities. The Company’s investment securities consist primarily of U.S. Treasury securities, which are stated at amortized cost, and auction rate securities consisting of preferred shares of closed end municipal bond funds, which are stated at their approximate fair value. The book value of the financial instruments, excluding the Company’s long-term debt, is representative of their fair values (see "Fair Value Measurements," Note 5). Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., "the exit price") in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various valuation approaches, including quoted market prices and discounted cash flows. The hierarchy for inputs used in measuring fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from independent sources. Unobservable inputs are inputs that reflect a company’s judgment concerning the assumptions that market participants would use in pricing the asset or liability developed based on the best information available under the circumstances. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset or liability must be classified in its entirety based on the lowest level of input that is significant to the measurement of fair value. The fair value hierarchy is broken down into three levels based on the reliability of inputs as follows: • Level 1 - Valuations based on quoted prices in active markets for identical instruments that the Company is able to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. • Level 2 - Valuations based on quoted prices in active markets for instruments that are similar, or quoted prices in markets that are not active for identical or similar instruments, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. • Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The Company’s financial instruments include cash and cash equivalents, investment securities, other long-term investments, accounts payable, short-term and long-term debt, derivative liabilities, and certain other liabilities. The book value of the Company's financial instruments, excluding long-term debt, long-term investments and derivative liabilities, are representative of their fair values. |
Leases | Leases The Company determines if an arrangement is a lease or contains a lease at the inception of the contract. The Company’s leases generally contain fixed and variable components. Variable components are primarily contingent rents based upon store sales exceeding stipulated amounts. Lease agreements may also include non-lease components, such as certain taxes, insurance and common area maintenance, which the Company combines with the lease component to account for both as a single lease component. Lease liabilities, which represent the Company’s obligation to make lease payments arising from the lease, and corresponding right-of-use assets, which represent the Company’s right to use an underlying asset for the lease term, are recognized at the commencement date of the lease, which is typically the date the Company obtains possession of the leased premises, based on the present value of fixed future payments over the lease term. The Company utilizes the lease term for which it is reasonably certain to use the underlying asset, including consideration of options to extend or terminate the lease. Incentives received from landlords are recorded as a reduction to the lease right-of-use assets. The Company does not recognize lease right-of-use assets and corresponding lease liabilities for leases with initial terms of 12 months or less. The Company calculates the present value of future payments using the discount rate implicit in the lease, if available, or its incremental borrowing rate. The incremental borrowing rate is the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. The Company determined discount rates based on the rates of its unsecured borrowings, which are then adjusted for the appropriate lease term and effects of full collateralization. In determining the Company's operating lease assets and operating lease liabilities, the Company applied these incremental borrowing rates to the minimum lease payments within each lease agreement. For operating leases, lease expense relating to fixed payments is recognized on a straight-line basis over the lease term and lease expense relating to variable payments is expensed as incurred. For finance leases, the amortization of the asset is recognized over the shorter of the lease term or useful life of the underlying asset (see "Leases," Note 9). |
Revenue Recognition | Revenue Recognition Sales are recognized upon purchase by customers at the Company’s retail stores or upon delivery for products purchased from its websites. The value of point-of-sale coupons and point-of-sale rebates that result in a reduction of the price paid by the customer are recorded as a reduction of sales. Shipping and handling fees that are billed to a customer in a sale transaction are recorded in sales. Taxes, such as sales tax, use tax and value added tax, are not included in sales. Revenues from gift cards, gift certificates and merchandise credits are recognized when redeemed. Gift cards have no provisions for reduction in the value of unused card balances over defined time periods and have no expiration dates. In Fiscal 2022 and Fiscal 2021, the Company recognized net sales for gift card and merchandise credit redemptions of approximately $76.7 million and $72.3 million, respectively, which were included in merchandise credit and gift card liabilities on the consolidated balance sheet as of February 26, 2022 and February 27, 2021, respectively. During the second quarter of fiscal 2022, the Company launched its cross-banner customer loyalty program, Welcome Rewards™, which allows members to earn points for each qualifying purchase at its retail banners either online or in its stores. Points earned are then converted to rewards upon reaching certain thresholds. These rewards may then be redeemed on future merchandise purchases at its retail banners. The Company defers a portion of the revenue related to the points earned at the time of the original transaction and revenue is recognized for these performance obligations upon redemption or expiration of points or rewards earned by the customer. As of February 25, 2023, the Company recorded $4.2 million of loyalty program liabilities in accrued expenses and other current liabilities on the consolidated balance sheet. Sales returns are provided for in the period that the related sales are recorded based on historical experience. Although the estimate for sales returns has not varied materially from historical provisions, actual experience could vary from historical experience in the future if the level of sales return activity changes materially. In the future, if the Company concludes that an adjustment is required due to material changes in the returns activity, the liability for estimated returns and the corresponding right of return asset will be adjusted accordingly. As of February 25, 2023 and February 26, 2022, the liability for estimated returns of $6.9 million and $23.6 million is included in accrued expenses and other current liabilities and the corresponding right of return asset for merchandise of $4.8 million and $14.6 million, respectively, is included in prepaid expenses and other current assets, respectively. The Company sells a wide assortment of domestics merchandise and home furnishings. Domestics merchandise includes categories such as bed linens and related items, bath items and kitchen textiles. Home furnishings include categories such as kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings (including furniture and wall décor), consumables and certain juvenile products. Sales of domestics merchandise and home furnishings accounted for approximately 35.8% and 64.2% of net sales, respectively, for Fiscal 2022, 37.4% and 62.6% of net sales, respectively, for Fiscal 2021 and 34.7% and 65.3% of net sales, respectively, for Fiscal 2020. |
Cost of Sales and Vendor Allowances | Cost of SalesCost of sales includes the cost of merchandise, buying costs and costs of the Company’s distribution network including inbound freight charges, import charges (including duties), distribution facility costs, receiving costs, internal transfer costs and shipping and handling costs.Vendor AllowancesThe Company receives allowances from vendors in the normal course of business for various reasons including direct cooperative advertising, purchase volume and reimbursement for other expenses. Annual terms for each allowance include the basis for earning the allowance and payment terms, which vary by agreement. All vendor allowances are recorded as a reduction of inventory cost, except for direct cooperative advertising allowances which are specific, incremental and identifiable. The Company recognizes purchase volume allowances as a reduction of the cost of inventory in the quarter in which milestones are achieved. |
Store Opening, Expansion, Relocation and Closing Costs | Store Opening, Expansion, Relocation and Closing CostsStore opening, expansion, relocation and closing costs, including markdowns, asset residual values and projected occupancy costs, are charged to earnings as incurred. |
Advertising Costs | Advertising CostsAdvertising expenses related to direct response advertising are expensed on the first day of the direct response advertising event. All other advertising expenses associated with store advertising are charged to earnings as incurred. |
Stock-Based Compensation | Stock-Based CompensationThe Company measures all employee stock-based compensation awards using a fair value method and records such expense, net of estimated forfeitures, in its consolidated financial statements. The Company’s stock-based compensation relates to restricted stock awards, stock options, restricted stock units and performance stock units. The Company’s restricted stock awards are considered nonvested share awards (see "Stock-Based Compensation," Note 11).The Company measures all stock-based compensation awards for employees and non-employee directors using a fair value method and records such expense, net of estimated forfeitures, in its consolidated financial statements. Currently, the Company’s stock-based compensation relates to restricted stock awards, restricted stock units, performance stock units, and stock options. The Company’s restricted stock awards are considered nonvested share awards. |
Income Taxes | Income Taxes The Company files a consolidated federal income tax return. Income tax returns are also filed with each taxable jurisdiction in which the Company conducts business. The Company accounts for its income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. In assessing the recoverability of its deferred tax assets, the Company evaluates the available objective positive and negative evidence to estimate whether it is more likely than not that sufficient future taxable income will be generated to permit use of existing deferred tax assets in each taxpaying jurisdiction. For any deferred tax asset in excess of the amount for which it is more likely than not that the Company will realize a benefit, a valuation allowance is established. A valuation allowance is a non-cash charge, and does not limit the Company's ability to utilize its deferred tax assets, including its ability to utilize tax loss and credit carryforward amounts against future taxable income. The Company recognizes the tax benefit from an uncertain tax position only if it is at least more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon settlement with the taxing authorities. Judgment is required in determining the provision for income and other taxes and related accruals, and deferred tax assets and liabilities. In the ordinary course of business, there are transactions and calculations where the ultimate tax outcome is uncertain. Additionally, the Company's various tax returns are subject to audit by various tax authorities. Although the Company believes that its estimates are reasonable, actual results could differ from these estimates (see "Provision for Income Taxes", Note 12). |
Earnings per Share | Earnings per ShareThe Company presents earnings per share on a basic and diluted basis. Basic earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding. Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding, including the dilutive effect of stock-based awards as calculated under the treasury stock method. For Fiscal 2022, Fiscal 2021 and Fiscal 2020, the Company reported a net loss and therefore, the potentially dilutive securities are antidilutive and accordingly, basic net loss per share equals diluted net loss per share. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Feb. 25, 2023 | |
Leases [Abstract] | |
Schedule of Lease Cost | The components of total lease cost for the fiscal year ended February 25, 2023 and February 26, 2022 were as follows: (in thousands) Statement of Operations Location February 25, 2023 February 26, 2022 Operating lease cost Cost of sales and SG&A $ 386,319 $ 449,394 Finance lease cost: Depreciation of property SG&A 1,611 184 Interest on lease liabilities Interest expense, net 4,966 1,886 Variable lease cost Cost of sales and SG&A 138,219 152,259 Sublease income SG&A (55,407) (43,922) Total lease cost $ 475,708 $ 559,801 |
Assets and Liabilities Related to Operating and Finance Leases | As of February 25, 2023 and February 26, 2022, assets and liabilities related to the Company's operating and finance leases were as follows: (in thousands) Consolidated Balance Sheet Location February 25, 2023 February 26, 2022 Assets Operating leases Operating lease assets $ 965,882 $ 1,562,857 Finance leases Property and equipment, net — 38,790 Total Lease assets $ 965,882 $ 1,601,647 Liabilities Current: Operating leases Current operating lease liabilities $ 301,194 $ 346,506 Finance leases Accrued expenses and other current liabilities 7,048 2,494 Noncurrent: Operating leases Operating lease liabilities 1,278,467 1,508,002 Finance leases Other liabilities 64,052 35,447 Total lease liabilities $ 1,650,761 $ 1,892,449 |
Schedule of Lease Liabilities, Operating | As of February 25, 2023, the Company's lease liabilities mature as follows: (in thousands) Operating Leases Finance Leases Fiscal Year: 2023 $ 373,985 $ 11,525 2024 355,359 11,525 2025 295,382 11,525 2026 229,674 11,525 2027 183,157 11,525 Thereafter 560,964 48,841 Total lease payments $ 1,998,521 $ 106,466 Less imputed interest (418,860) (35,366) Present value of lease liabilities $ 1,579,661 $ 71,100 |
Schedule of Other Lease Information | The Company's lease terms and discount rates were as follows: February 25, 2023 February 26, 2022 Weighted-average remaining lease term (in years) Operating leases 6.7 years 7.0 years Finance leases 9.5 years 10.0 years Weighted-average discount rate Operating leases 8.3 % 6.0 % Finance leases 8.3 % 8.4 % Other information with respect to the Company's leases is as follows: (in thousands) February 25, 2023 February 26, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 419,553 $ 450,082 Operating cash flows from finance leases 4,448 1,886 Financing cash flows from finance leases 3,206 1,033 Operating lease assets obtained in exchange for new operating lease liabilities 96,669 359,933 Financing lease assets obtained in exchange for new financing lease liabilities 35,030 38,974 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Feb. 25, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment consist of the following: (in thousands) February 25, 2023 February 26, 2022 Land and buildings $ 4,750 $ 21,597 Furniture, fixtures and equipment (1) 33,985 594,443 Leasehold improvements — 746,365 Computer equipment and software 11,408 1,494,457 Total 50,143 2,856,862 Less: Accumulated depreciation (1) — (1,829,475) Property and equipment, net $ 50,143 $ 1,027,387 ________________________ (1) $63.6 million of furniture, fixtures and equipment, in assets held under finance leases, were fully impaired in Fiscal 2022. Furniture, fixtures and equipment includes $39.0 million in assets held under finance leases as of February 26, 2022. Accumulated depreciation includes $0.2 million in accumulated depreciation for assets held under finance leases as of February 26, 2022. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Feb. 25, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation Expense and Capitalized Cost | Stock-based compensation expense and capitalized stock-based compensation cost for the fiscal year ended February 25, 2023, February 26, 2022, and February 27, 2021 were as follows: (in thousands) February 25, 2023 February 26, 2022 February 27, 2021 Stock-based compensation expense: Equity-classified share-settled awards $ 19,394 $ 35,064 $ 31,600 Liability-classified cash-settled awards $ 1,002 $ — $ — Total stock-based compensation expense $ 20,396 $ 35,064 $ 31,600 Capitalized stock-based compensation cost: Equity-classified share-settled awards $ 817 $ 1,020 $ 800 Liability-classified cash-settled awards $ 41 $ — $ — Total capitalized stock-based compensation cost $ 858 $ 1,020 $ 800 |
Changes in the Company's Performance Stock Units | Fiscal Year Performance Period Performance Metrics Target Achievement Range (%) 2020 3 years TSR 0% - 150% 2021 3 years TSR and GM 0% - 150% 2022 3 years TSR and GM 0% - 200% Changes in the Company’s PSUs for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Performance Stock Units Weighted Average Grant-Date Fair Unvested performance stock units, beginning of period 1,298 $ 19.55 Granted 2,143 6.79 Vested (666) 15.81 Forfeited (1,292) 15.49 Unvested performance stock units, end of period 1,483 $ 6.33 |
Assumptions Used To Estimate the Black-Scholes Fair Value of Performance Stock Units Granted | The fair value of the PSUs granted in Fiscal 2022 for which performance during the three-year period will be based on a relative three-year Total Shareholder Return ("TSR") goal relative to a peer group was estimated on the date of the grant using a Monte Carlo simulation that uses the assumptions noted in the following table. Fiscal Year Ended Monte Carlo Simulation Assumptions February 25, 2023 February 26, 2022 February 27, 2021 Risk Free Interest Rate 3.55 % 0.29 % 0.25 % Expected Dividend Yield — % — % — % Expected Volatility 55.00 % 52.21 % 51.47 % Expected Term (in years) 3 years 3 years 3 years |
Assumptions Used To Estimate the Black-Scholes Fair Value of Stock Options Granted | Fiscal Year Ended Black-Scholes Valuation Assumptions (1) February 29, 2020 Weighted Average Expected Life (in years) (2) 7.6 years Weighted Average Expected Volatility (3) 39.41 % Weighted Average Risk Free Interest Rates (4) 2.39 % Expected Dividend Yield (5) 4.34 % ________________________ (1) Forfeitures were estimated based on historical experience. (2) The expected life of stock options was estimated based on historical experience. (3) Expected volatility was based on the average of historical and implied volatility. The historical volatility was determined by observing actual prices of the Company’s stock over a period commensurate with the expected life of the awards. The implied volatility represented the implied volatility of the Company’s call options, which were actively traded on multiple exchanges, had remaining maturities in excess of twelve months, had market prices close to the exercise prices of the employee stock options and were measured on the stock option grant date. (4) Based on the U.S. Treasury constant maturity interest rate whose term was consistent with the expected life of the stock options. (5) Expected dividend yield was estimated based on anticipated dividend payouts. |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Unit Activity | Changes in the Company’s restricted stock awards for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Restricted Shares Weighted Average Grant-Date Fair Unvested restricted stock awards, beginning of period 472 $ 32.38 Granted 392 4.90 Vested (168) 38.44 Forfeited (214) 22.63 Unvested restricted stock awards, end of period 482 $ 12.25 Changes in the Company’s RSUs for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Restricted Stock Units Weighted Average Grant-Date Fair Unvested restricted stock units, beginning of period 2,600 $ 17.07 Granted 262 6.78 Vested (1,414) 15.29 Forfeited (890) 18.04 Unvested restricted stock units, end of period 558 $ 15.20 Changes in the Company’s RSUs that will be settled in cash for the fiscal year ended February 25, 2023 were as follows: (Shares in thousands) Number of Restricted Stock Units Weighted Average Grant-Date Fair Unvested restricted stock units, beginning of period 57 $ 23.44 Granted 2,356 8.71 Vested (144) 9.89 Forfeited (989) 10.10 Unvested restricted stock units, end of period 1,280 $ 8.17 |
Provision for Income Taxes (Tab
Provision for Income Taxes (Tables) | 12 Months Ended |
Feb. 25, 2023 | |
Income Tax Disclosure [Abstract] | |
Components of the Provision for Income Taxes | The components of the (benefit) provision for income taxes are as follows: Fiscal Year Ended (in thousands) February 25, 2023 February 26, 2022 February 27, 2021 Current: Federal $ (19,584) $ (43,740) $ (336,506) State and local (11,485) 3,397 1,211 (31,069) (40,343) (335,295) Deferred: Federal — 73,006 150,861 State and local — 54,304 (1,555) — 127,310 149,306 $ (31,069) $ 86,967 $ (185,989) |
Schedule of Deferred Tax Assets and Liabilities | The significant components of the Company’s deferred tax assets and liabilities consist of the following: (in thousands) February 25, 2023 February 26, 2022 Deferred tax assets: Inventories $ (1,688) $ 4,077 Operating lease liabilities 396,416 473,397 Insurance 14,077 6,416 Stock-based compensation (1,005) 1,592 Merchandise credits and gift card liabilities 62,300 56,690 Accrued expenses 24,835 23,412 Intangibles 1,585 1,685 Goodwill (351) 90 Carryforwards, NOLs and other tax credits 793,163 189,746 Other (4,920) 34,991 Valuation allowance: $ (908,614) $ (249,529) Deferred tax liabilities: Depreciation (126,324) (146,970) Prepaid expenses (5,292) (1,155) Operating lease assets (222,121) (376,079) Other (22,061) (18,499) $ — $ (136) |
Summary of Gross Unrecognized Tax Benefits from Uncertain Tax Positions Activity | The following table summarizes the activity related to the gross unrecognized tax benefits from uncertain tax positions: (in thousands) February 25, 2023 February 26, 2022 Balance at beginning of year $ 95,518 $ 105,749 Increase/(Decrease) related to current year positions (212) 1,125 Decrease related to prior year positions 485 (1,902) Settlements (2,340) (2,340) Lapse of statute of limitations (1,113) (7,114) Balance at end of year $ 92,338 $ 95,518 |
Schedule of Effective Income Tax Rate Reconciliation | The following table summarizes the reconciliation between the effective income tax rate and the federal statutory rate: Fiscal Year Ended February 25, 2023 February 26, 2022 February 27, 2021 Federal statutory rate 21.00 % 21.00 % 21.00 % State income tax rate, net of federal impact 2.66 % 3.87 % 3.94 % Uncertain tax positions — % 2.16 % 1.63 % Goodwill non-deductible impairment charges — % — % — % Tax deficiencies related to stock-based compensation (0.07) % (0.81) % (3.18) % Tax credits 0.03 % 0.38 % 0.41 % CARES Act — % 0.94 % 35.98 % Valuation Allowance (18.94) % (48.01) % (7.74) % Canadian Branch Earnings — % 1.60 % 0.78 % Loss on Warrant Issuance (3.80) % — % — % Other — % 0.47 % 2.35 % 0.88 % (18.40) % 55.17 % |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies and Related Matters (Details) shares in Millions | 7 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 segment | Feb. 25, 2023 USD ($) segment day shares | Feb. 26, 2022 USD ($) shares | Feb. 27, 2021 USD ($) shares | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Number of operating segments | segment | 2 | 1 | ||
Number of business days | day | 5 | |||
Credit and debit card receivables, at carrying value | $ 24,500,000 | $ 47,900,000 | ||
Restricted cash | 66,242,000 | 0 | ||
Long-term restricted cash | $ 15,262,000 | 31,388,000 | ||
Auction rate securities interval period, one | 7 days | |||
Auction rate securities interval period, two | 28 days | |||
Auction rate securities interval period, three | 35 days | |||
Long-term available-for-sale investment securities sold | $ 20,300,000 | |||
Proceeds from sale of available-for-sale investment securities | 18,864,000 | 0 | $ 0 | |
Realized loss on available-for-sale investment securities | 1,411,000 | 0 | 0 | |
Long-term available-for-sale investment securities loss reclassified out of accumulated other comprehensive loss | 1,100,000 | |||
Short-term available-for-sale investment securities | 0 | 0 | ||
Cost of repairs and maintenance | $ 34,700,000 | 80,000,000 | 117,700,000 | |
Impairment, Long-Lived Asset, Held-for-Use, Statement of Income or Comprehensive Income [Extensible Enumeration] | Impairments | |||
Non-cash pre-tax impairment charge | $ 1,280,000,000 | 30,800,000 | ||
Indefinite-lived intangible assets | $ 13,200,000 | 16,300,000 | ||
Impairment, Intangible Asset, Finite-Lived, Statement of Income or Comprehensive Income [Extensible Enumeration] | Impairments | |||
Prepaid expenses and other current assets | $ 147,261,000 | 198,248,000 | ||
Income taxes receivable | 16,100,000 | 26,500,000 | ||
Net sales for gift card and merchandise credit redemptions | 76,700,000 | 72,300,000 | ||
Loyalty program liabilities | 4,200,000 | |||
Liability for estimated returns | 6,900,000 | 23,600,000 | ||
Right of return asset for merchandise, percentage | 4,800,000 | 14,600,000 | ||
Cooperative advertising amount | 24,000,000 | 35,800,000 | 28,900,000 | |
Advertising expense | $ 393,700,000 | $ 407,100,000 | $ 347,800,000 | |
Share-Based Payment Arrangement | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Shares excluded from computation of earnings per share (in shares) | shares | 1.7 | 2.9 | 2.4 | |
Preferred Stock and Derivatives | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Shares excluded from computation of earnings per share (in shares) | shares | 15.7 | |||
Auction Rate Securities | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Long term available-for-sale investment securities | $ 20,300,000 | |||
Valuation adjustments | $ 1,100,000 | |||
Domestic Merchandise | Net Sales | Product Concentration Risk | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Percentage of net sales | 35.80% | 37.40% | 34.70% | |
Home Furnishings | Net Sales | Product Concentration Risk | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Percentage of net sales | 64.20% | 62.60% | 65.30% | |
North American Retail | Trade Names | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Intangible asset impairment charge | $ 2,900,000 | $ 5,700,000 | $ 35,100,000 | |
Building | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Estimated useful life | 39 years | |||
Furniture, Fixtures and Equipment | Minimum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Estimated useful life | 7 years | |||
Furniture, Fixtures and Equipment | Maximum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Estimated useful life | 20 years | |||
Computer Equipment and Software | Minimum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Estimated useful life | 3 years | |||
Computer Equipment and Software | Maximum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Estimated useful life | 10 years |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | Jul. 17, 2014 | |
Debt Instrument [Line Items] | ||||
Negative cash flows from operations | $ 990,979 | $ (17,854) | $ (268,108) | |
The 2024 Notes | Senior Unsecured Notes | ||||
Debt Instrument [Line Items] | ||||
Debt interest rate | 3.749% | |||
The 2034 Notes | Senior Unsecured Notes | ||||
Debt Instrument [Line Items] | ||||
Debt interest rate | 4.915% | |||
The 2044 Notes | Senior Unsecured Notes | ||||
Debt Instrument [Line Items] | ||||
Debt interest rate | 5.165% |
Restructuring and Transformat_2
Restructuring and Transformation Activities (Details) $ in Millions | 12 Months Ended | ||
Feb. 25, 2023 USD ($) | Feb. 26, 2022 USD ($) store | Feb. 27, 2021 USD ($) store | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring reserve | $ 31.6 | $ 12.8 | |
Fiscal 2022 Restructuring Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 407.7 | ||
Fiscal 2022 Restructuring Charges | Other Restructuring | Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 77.7 | ||
Fiscal 2022 Restructuring Charges | Store Closures and Other Transformation Initiatives | |||
Restructuring Cost and Reserve [Line Items] | |||
Accelerated depreciation | 156.9 | ||
Other restructuring and transformation costs | 101.5 | ||
Severance costs | 58.1 | ||
Lease-related costs | 13.5 | ||
Fiscal 2022 Restructuring Charges | Store Closures and Other Transformation Initiatives | Restructuring Charges and Transformation Initiative Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | $ 330 | ||
Fiscal 2021 Restructuring Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Number of stores closed | store | 207 | ||
Fiscal 2021 Restructuring Charges | Restructuring Charges and Transformation Initiative Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | $ 281.2 | ||
Fiscal 2021 Restructuring Charges | Other Restructuring | Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 137.2 | ||
Fiscal 2021 Restructuring Charges | Other Restructuring | Restructuring Charges and Transformation Initiative Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 96.1 | ||
Fiscal 2021 Restructuring Charges | Store Closures and Other Transformation Initiatives | Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 12 | ||
Fiscal 2021 Restructuring Charges | Store Closures and Other Transformation Initiatives | Restructuring Charges and Transformation Initiative Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 144 | ||
Fiscal 2021 Restructuring Charges | Brand Initiatives | Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 125.2 | ||
Fiscal 2021 Restructuring Charges | Network Optimization Program | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | 2.4 | ||
Lease-related costs | $ 45.5 | ||
Fiscal 2021 Restructuring Charges related to Store Fleet Optimization | |||
Restructuring Cost and Reserve [Line Items] | |||
Number of stores closed | store | 63 | ||
Fiscal 2020 Restructuring Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 149.3 | ||
Number of stores closed | store | 144 | ||
Number of stores expected to close | store | 200 | ||
Number of positions affected by workforce reduction | store | 2,800 | ||
Fiscal 2020 Restructuring Charges | Other Restructuring | Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | $ 26.1 | ||
Fiscal 2020 Restructuring Charges | Other Restructuring | Restructuring Charges and Transformation Initiative Charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Transformation initiative costs | 34.6 | ||
Fiscal 2020 Restructuring Charges | Network Optimization Program | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | 5.3 | ||
Lease-related costs | 39.2 | ||
Fiscal 2020 Restructuring Charges | Network Optimization Program | Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 21 | ||
Fiscal 2020 Restructuring Charges | Employee Severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance costs | $ 23.1 |
Deconsolidation - Canadian Op_2
Deconsolidation - Canadian Operations (Details) - USD ($) | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Schedule of Investments [Line Items] | |||
Loss on deconsolidation of subsidiaries | $ 98,633,000 | $ 0 | $ 0 |
BBB Canada | |||
Schedule of Investments [Line Items] | |||
Investment fair value | 0 | ||
Loss on deconsolidation of subsidiaries | $ 98,600,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Feb. 07, 2023 | May 27, 2023 | Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Fair value of long-term debt | $ 176,300 | $ 956,000 | |||
Long-term debt, carrying value | 1,030,000 | 1,184,000 | |||
Proceeds from issuance of Series A and preferred and common stock warrants | $ 225,000 | 225,008 | 0 | $ 0 | |
Issuance costs | 6,334 | $ 0 | $ 0 | ||
Embedded derivative liability | 300,500 | 166,900 | |||
Warrants outstanding | 1,102,600 | ||||
Loss on derivative liabilities | 877,600 | ||||
Gain on derivative liabilities | 244,500 | ||||
Forecast [Member] | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Gain on derivative liabilities | $ 353,600 | ||||
Common Stock Warrants | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Warrants outstanding | 186,600 | 2,700 | |||
Preferred Stock Warrants | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Warrants outstanding | 615,500 | $ 404,400 | |||
Series A Preferred Stock | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Issuance costs | $ 6,300 |
Derivatives (Details)
Derivatives (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Mar. 30, 2023 | Mar. 07, 2023 | Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | Feb. 07, 2023 | |
Derivative [Line Items] | ||||||
Proceeds from exercise of preferred stock warrants | $ 47,500 | $ 0 | $ 0 | |||
Shares of common stock issued in exchange (in shares) | 13,543 | |||||
Subsequent Event | ||||||
Derivative [Line Items] | ||||||
Shares of common stock issued in exchange (in shares) | 10,000,000 | |||||
Equity offering, right to participate period | 2 years | |||||
Preferred Stock Warrants | ||||||
Derivative [Line Items] | ||||||
Warrants issued (in shares) | 84,216 | |||||
Warrant price (in dollars per share) | $ 9,500 | |||||
Warrants exercise period | 20 days | |||||
Warrants exercised (in shares) | 5,000 | |||||
Proceeds from exercise of preferred stock warrants | $ 47,500 | |||||
Preferred Stock Warrants | Subsequent Event | ||||||
Derivative [Line Items] | ||||||
Warrants exercised (in shares) | 9,212 | |||||
Proceeds from exercise of preferred stock warrants | $ 87,500 | |||||
Warrants exchanged (in shares) | 70,004 | |||||
Common Stock Rights | Subsequent Event | ||||||
Derivative [Line Items] | ||||||
Warrants issued (in shares) | 5,000,000 | |||||
Common Stock Warrants | ||||||
Derivative [Line Items] | ||||||
Warrants issued (in shares) | 95,387,533 | |||||
Warrant price (in dollars per share) | $ 6.15 | |||||
Warrants exercise period | 5 years | |||||
Warrants exercised (in shares) | 109,000,000 | |||||
Warrant cashless exercise, shares received for each warrant (in shares) | 0.65 | |||||
Warrant cashless exercise, warrants issued (in shares) | 62,000,000 | |||||
Common stock issuable (in shares) | 16,300,000 | |||||
Warrant weighted-average cost per share (in dollars per share) | $ 44.27 | |||||
Warrants exercised, shares reissued out of treasury stock, cost | $ 3,100,000 | |||||
Common Stock Warrants | Subsequent Event | ||||||
Derivative [Line Items] | ||||||
Common stock issuable (in shares) | 37,300,000 |
Debt - Senior Unsecured Notes (
Debt - Senior Unsecured Notes (Details) - Senior Unsecured Notes | Jul. 17, 2014 USD ($) |
The 2024 Notes | |
Debt Instrument [Line Items] | |
Aggregate principal amount | $ 300,000,000 |
Debt interest rate | 3.749% |
The 2034 Notes | |
Debt Instrument [Line Items] | |
Aggregate principal amount | $ 300,000,000 |
Debt interest rate | 4.915% |
The 2044 Notes | |
Debt Instrument [Line Items] | |
Aggregate principal amount | $ 900,000,000 |
Debt interest rate | 5.165% |
Debt - Exchange Offers (Details
Debt - Exchange Offers (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Nov. 30, 2022 | Feb. 25, 2023 | Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | Nov. 26, 2022 | Jul. 17, 2014 | |
Debt Instrument [Line Items] | |||||||
Shares of common stock issued in exchange (in shares) | 13,543 | ||||||
Gain (loss) on extinguishment of debt | $ 94,400 | $ 94,343 | $ (376) | $ 77,038 | |||
Exchange Offers | |||||||
Debt Instrument [Line Items] | |||||||
Shares of common stock issued in exchange (in shares) | 13,600,000 | ||||||
Sale of stock (in shares) | 900,000 | ||||||
Sale of stock, proceeds | $ 3,500 | ||||||
Senior Unsecured Notes | |||||||
Debt Instrument [Line Items] | |||||||
Third-party fees | 8,000 | ||||||
Unamortized debt financing costs write-off | 400 | ||||||
Aggregate principal amount purchased | 0 | ||||||
Senior Unsecured Notes | Other Assets | |||||||
Debt Instrument [Line Items] | |||||||
Unamortized deferred financing costs | $ 3,800 | $ 3,800 | 4,600 | ||||
New Second Lien Non-Convertible Notes | Secured Debt | |||||||
Debt Instrument [Line Items] | |||||||
Debt interest rate | 3.693% | ||||||
New Second Lien Convertible Notes | Secured Debt | |||||||
Debt Instrument [Line Items] | |||||||
Debt interest rate | 8.821% | ||||||
New Third Lien Convertible Notes | Secured Debt | |||||||
Debt Instrument [Line Items] | |||||||
Debt interest rate | 12% | ||||||
2024 Notes | Senior Unsecured Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt conversion, aggregate principal amount | 69,000 | ||||||
2034 Notes | Senior Unsecured Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt conversion, aggregate principal amount | 15,300 | ||||||
2044 Notes | Senior Unsecured Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt conversion, aggregate principal amount | $ 70,200 | ||||||
The 2024 Notes | Senior Unsecured Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt interest rate | 3.749% | ||||||
Aggregate principal amount purchased | $ 11,000 | ||||||
Consideration paid | $ 11,400 |
Debt - Asset-Based Credit Agree
Debt - Asset-Based Credit Agreement (Details) - USD ($) | 12 Months Ended | ||||||||
Mar. 06, 2023 | Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | Mar. 30, 2023 | Feb. 07, 2023 | Aug. 31, 2022 | Aug. 28, 2021 | Aug. 09, 2021 | |
Senior Unsecured Notes and Revolver | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest expense | $ 107,500,000 | $ 64,100,000 | $ 73,600,000 | ||||||
Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Additional financing | $ 500,000,000 | ||||||||
Revolving Credit Facility | Subsequent Event | |||||||||
Debt Instrument [Line Items] | |||||||||
Minimum equity proceeds | $ 100,000,000 | $ 232,000,000 | |||||||
Equity proceeds trading days | 22 days | ||||||||
Weekly minimum equity proceeds | $ 12,500,000 | ||||||||
Revolving Credit Facility | ABL Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior unsecured revolving credit facility | $ 565,000,000 | 1,130,000,000 | $ 1,000,000,000 | ||||||
Expansion feature aggregate amount (up to) | $ 375,000,000 | ||||||||
Additional financing | $ 130,000,000 | ||||||||
Loans outstanding | $ 191,300,000 | ||||||||
Percentage of eligible credit card receivables upon satisfaction | 90% | ||||||||
Percentage of eligible inventory upon satisfaction | 90% | ||||||||
Loans outstanding weighted average interest rate | 8.68% | ||||||||
Outstanding letters of credit | $ 126,900,000 | ||||||||
Revolving Credit Facility | ABL Facility | Other Assets | |||||||||
Debt Instrument [Line Items] | |||||||||
Unamortized deferred financing costs | 9,800,000 | $ 7,400,000 | |||||||
Revolving Credit Facility | ABL Facility | Alternate Base Rate and Canadian Prime Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Minimum interest rate margin | 1% | ||||||||
Revolving Credit Facility | ABL Facility | SOFR and CDOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Minimum interest rate margin | 0% | ||||||||
Interest rate margin deemed | 0% | ||||||||
Revolving Credit Facility | ABL Facility | Minimum | Alternate Base Rate and Canadian Prime Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate margin | 1.25% | ||||||||
Revolving Credit Facility | ABL Facility | Minimum | SOFR and CDOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate margin | 2.25% | ||||||||
Revolving Credit Facility | ABL Facility | Maximum | Alternate Base Rate and Canadian Prime Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate margin | 1.75% | ||||||||
Revolving Credit Facility | ABL Facility | Maximum | SOFR and CDOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate margin | 2.75% | ||||||||
Revolving Credit Facility | FILO Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Additional financing | $ 375,000,000 | ||||||||
Loans outstanding | 428,900,000 | ||||||||
Percentage of eligible credit card receivables upon satisfaction | 15% | ||||||||
Percentage of eligible inventory upon satisfaction | 15% | ||||||||
Percentage of eligible foreign in-transit inventory upon satisfaction | 100% | ||||||||
Percentage of eligible domestic in-transit inventory upon satisfaction | 15% | ||||||||
Percentage of eligible intellectual property upon satisfaction | 68% | ||||||||
Percentage of intellectual property upon satisfaction, reduction each fiscal quarter | 2.50% | ||||||||
Borrowing base sum | $ 115,000,000 | ||||||||
Borrowing base sum, reduction each fiscal quarter | 4,700,000 | ||||||||
Borrowing base sum, reduction upon consummation of certain dispositions | $ 75,000,000 | ||||||||
Non-callable period | 18 months | ||||||||
Prepayment premium between 18 months and 30 months following funding date | 2% | ||||||||
Prepayment premium between 30 months and 36 months following funding date | 1% | ||||||||
Prepayment premium after 36 months following funding date | 0% | ||||||||
Amortize rate | 5% | ||||||||
Amortize rate quarterly installments | 1.25% | ||||||||
Revolving Credit Facility | FILO Facility | Long-Term Debt, Current Maturities | |||||||||
Debt Instrument [Line Items] | |||||||||
Unamortized deferred financing costs | 20,900,000 | ||||||||
Revolving Credit Facility | FILO Facility | Alternate Base Rate and Canadian Prime Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate margin | 6.75% | ||||||||
Minimum interest rate margin | 2% | ||||||||
Interest rate margin deemed | 2% | ||||||||
Revolving Credit Facility | FILO Facility | SOFR and CDOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate margin | 7.75% | ||||||||
Minimum interest rate margin | 1% | ||||||||
Interest rate margin deemed | 1% | ||||||||
Revolving Credit Facility | FILO Facility | Minimum | |||||||||
Debt Instrument [Line Items] | |||||||||
Prepayment premium, term one | 18 months | ||||||||
Prepayment premium, term two | 30 months | ||||||||
Revolving Credit Facility | FILO Facility | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Prepayment premium, term one | 30 months | ||||||||
Prepayment premium, term two | 36 months | ||||||||
Revolving Credit Facility | FILO Facility, Make-Whole Amount | |||||||||
Debt Instrument [Line Items] | |||||||||
Loans outstanding | $ 53,900,000 | 53,900,000 | |||||||
Loans outstanding weighted average interest rate | 12.59% | ||||||||
Revolving Credit Facility | Initial FILO Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Loans outstanding | $ 375,000,000 | ||||||||
Loans outstanding weighted average interest rate | 12.30% | ||||||||
Revolving Credit Facility | 2023 FILO Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Loans outstanding | $ 100,000,000 | ||||||||
Aggregate principal amount | $ 100,000,000 | ||||||||
Loans outstanding weighted average interest rate | 12.59% |
Shareholders' (Deficit) Equit_2
Shareholders' (Deficit) Equity and Mezzanine Equity - Repurchase Program (Details) - USD ($) shares in Millions | 3 Months Ended | 12 Months Ended | 219 Months Ended | |||||
May 29, 2021 | Feb. 27, 2021 | Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | Feb. 25, 2023 | Apr. 30, 2021 | Jan. 31, 2021 | |
Share Repurchases [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 12,950,000,000 | |||||||
Treasury stock acquired (in shares) | 123.3 | |||||||
Total cost of common stock repurchased | $ 46,146,000 | $ 589,433,000 | $ 5,079,000 | $ 11,731,000,000 | ||||
Remaining authorized share repurchase amount under program | $ 1,221,000,000 | $ 1,221,000,000 | ||||||
Accelerated Share Repurchase Program 4Q2020 | ||||||||
Share Repurchases [Line Items] | ||||||||
Stock repurchase program, authorized amount | $ 150,000,000 | |||||||
Treasury stock acquired (in shares) | 5 | |||||||
Accelerated Share Repurchase Program 1Q2021 | ||||||||
Share Repurchases [Line Items] | ||||||||
Treasury stock acquired (in shares) | 0.2 | |||||||
Taxes on Vested Awards | ||||||||
Share Repurchases [Line Items] | ||||||||
Treasury stock acquired (in shares) | 0.5 | |||||||
Total cost of common stock repurchased | $ 5,700,000 | |||||||
Common Stock | ||||||||
Share Repurchases [Line Items] | ||||||||
Treasury stock acquired (in shares) | 2.3 | |||||||
Total cost of common stock repurchased | $ 40,400,000 |
Shareholders' (Deficit) Equit_3
Shareholders' (Deficit) Equity and Mezzanine Equity - ATM Program (Details) $ / shares in Units, shares in Millions | 12 Months Ended | |||||||
May 09, 2023 $ / shares | Aug. 31, 2022 USD ($) $ / shares shares | Feb. 25, 2023 USD ($) $ / shares shares | Feb. 26, 2022 USD ($) $ / shares | Feb. 27, 2021 USD ($) | Mar. 30, 2023 USD ($) $ / shares | Dec. 24, 2022 USD ($) | Oct. 28, 2022 USD ($) $ / shares | |
Share Repurchases [Line Items] | ||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||
Total cash dividends paid | $ 329,000 | $ 749,000 | $ 23,108,000 | |||||
Subsequent Event | ||||||||
Share Repurchases [Line Items] | ||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | |||||||
Subsequent Event | Minimum | ||||||||
Share Repurchases [Line Items] | ||||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 0.10 | |||||||
Subsequent Event | Maximum | ||||||||
Share Repurchases [Line Items] | ||||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 0.20 | |||||||
ATM Offering Program | ||||||||
Share Repurchases [Line Items] | ||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||
Sale of stock (in shares) | shares | 12 | 22.2 | ||||||
Sale of stock, proceeds | $ 72,200,000 | $ 115,400,000 | ||||||
Authorized aggregate sales price | $ 105,600,000 | $ 150,000,000 | ||||||
Sale Agreement | Subsequent Event | ||||||||
Share Repurchases [Line Items] | ||||||||
Authorized aggregate sales price | $ 300,000,000 | |||||||
Common Stock Purchase Agreement | Subsequent Event | ||||||||
Share Repurchases [Line Items] | ||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | |||||||
Authorized aggregate sales price | $ 1,000,000,000 |
Shareholders' (Deficit) Equit_4
Shareholders' (Deficit) Equity and Mezzanine Equity - Mezzanine Equity and Rights (Details) (Details) - USD ($) $ / shares in Units, $ in Billions | 12 Months Ended | |||
Mar. 30, 2023 | Feb. 07, 2023 | Feb. 25, 2023 | Apr. 24, 2023 | |
Class of Stock [Line Items] | ||||
Issuance of Series A convertible preferred stock (in shares) | 23,685 | 23,685,000 | ||
Shares of common stock issued in exchange (in shares) | 13,543 | |||
Conversion price before addition of lowest volume weighted average price (in dollars per share) | $ 0.7160 | |||
Conversion price, percent of lowest volume weighted average price | 92% | |||
Conversion consecutive trading days | 10 years | |||
Liquidation preference percentage | 125% | |||
Redemption rights percentage | 115% | |||
Subsequent Event | ||||
Class of Stock [Line Items] | ||||
Shares of common stock issued in exchange (in shares) | 10,000,000 | |||
Conversion price before addition of lowest volume weighted average price (in dollars per share) | $ 0.7160 | |||
Minimum | ||||
Class of Stock [Line Items] | ||||
Conversion price (in dollars per share) | $ 6.15 | |||
Common Stock Warrants | ||||
Class of Stock [Line Items] | ||||
Warrant weighted-average cost per share (in dollars per share) | $ 44.27 | |||
Common Stock Warrants | Treasury Stock | ||||
Class of Stock [Line Items] | ||||
Conversion of stock | $ 3.1 | |||
Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Share price (in dollars per share) | $ 10,000 |
Leases - Narrative (Details)
Leases - Narrative (Details) ft² in Millions, $ in Millions | 12 Months Ended | ||
Feb. 25, 2023 USD ($) | Feb. 26, 2022 USD ($) | Feb. 29, 2020 USD ($) ft² | |
Lessee, Lease, Description [Line Items] | |||
Renewal term | 5 years | ||
Total payments withheld and/or delayed or deferred | $ 0.2 | $ 1.9 | |
Reduced rent expense related to rent abatement | 2.7 | ||
Square feet of owned real estate | ft² | 2.1 | ||
Proceeds from sale-leaseback transaction | $ 267.3 | ||
Transaction costs | 5.7 | ||
Loss on sale leaseback transaction | 33.1 | ||
Financing obligation | 19 | 13 | $ 14.5 |
Accrued Expenses and Other Current Liabilities | |||
Lessee, Lease, Description [Line Items] | |||
Financing obligation | 7.6 | 0.7 | |
Other Noncurrent Liabilities | |||
Lessee, Lease, Description [Line Items] | |||
Financing obligation | $ 11.4 | $ 12.3 | |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Lease initial terms | 10 years | ||
Sublease term | 5 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Lease initial terms | 15 years | ||
Sublease term | 10 years |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 25, 2023 | Feb. 26, 2022 | |
Leases [Abstract] | ||
Operating lease cost | $ 386,319 | $ 449,394 |
Finance lease cost: | ||
Depreciation of property | 1,611 | 184 |
Interest on lease liabilities | 4,966 | 1,886 |
Variable lease cost | 138,219 | 152,259 |
Sublease income | (55,407) | (43,922) |
Total lease cost | $ 475,708 | $ 559,801 |
Leases - Schedule of Lease Asse
Leases - Schedule of Lease Assets and Liabilities (Details) - USD ($) $ in Thousands | Feb. 25, 2023 | Feb. 26, 2022 |
Assets | ||
Operating leases | $ 965,882 | $ 1,562,857 |
Finance leases | 0 | 38,790 |
Total Lease assets | 965,882 | 1,601,647 |
Current: | ||
Operating leases | 301,194 | 346,506 |
Finance leases | 7,048 | 2,494 |
Noncurrent: | ||
Operating leases | 1,278,467 | 1,508,002 |
Finance leases | 64,052 | 35,447 |
Total lease liabilities | $ 1,650,761 | $ 1,892,449 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property and equipment, net | Property and equipment, net |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other liabilities | Other liabilities |
Leases - Schedule of Lease Matu
Leases - Schedule of Lease Maturities (Details) $ in Thousands | Feb. 25, 2023 USD ($) |
Operating Leases | |
2023 | $ 373,985 |
2024 | 355,359 |
2025 | 295,382 |
2026 | 229,674 |
2027 | 183,157 |
Thereafter | 560,964 |
Total lease payments | 1,998,521 |
Less imputed interest | (418,860) |
Present value of lease liabilities | 1,579,661 |
Finance Leases | |
2023 | 11,525 |
2024 | 11,525 |
2025 | 11,525 |
2026 | 11,525 |
2027 | 11,525 |
Thereafter | 48,841 |
Total lease payments | 106,466 |
Less imputed interest | (35,366) |
Present value of lease liabilities | $ 71,100 |
Leases - Lease Terms and Discou
Leases - Lease Terms and Discount Rates (Details) | Feb. 25, 2023 | Feb. 26, 2022 |
Weighted-average remaining lease term (in years) | ||
Operating leases | 6 years 8 months 12 days | 7 years |
Finance leases | 9 years 6 months | 10 years |
Weighted-average discount rate | ||
Operating leases | 8.30% | 6% |
Finance leases | 8.30% | 8.40% |
Leases - Cash Flow Information
Leases - Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Leases [Abstract] | |||
Operating cash flows from operating leases | $ 419,553 | $ 450,082 | |
Operating cash flows from finance leases | 4,448 | 1,886 | |
Financing cash flows from finance leases | 3,206 | 1,033 | $ 0 |
Operating lease assets obtained in exchange for new operating lease liabilities | 96,669 | 359,933 | |
Financing lease assets obtained in exchange for new financing lease liabilities | $ 35,030 | $ 38,974 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 25, 2023 | Feb. 26, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 50,143 | $ 2,856,862 |
Less: Accumulated Depreciation | 0 | (1,829,475) |
Property and equipment, net | 50,143 | 1,027,387 |
Finance lease impairment | 63,600 | |
Finance leases before accumulated depreciation | 39,000 | |
Finance leases accumulated depreciation | 200 | |
Land and buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,750 | 21,597 |
Furniture, Fixtures and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 33,985 | 594,443 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 0 | 746,365 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 11,408 | $ 1,494,457 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 298.5 | $ 292.3 | $ 338.7 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-based Compensation Expense and Capitalized Cost (Details) - USD ($) | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | $ 20,396,000 | $ 35,064,000 | $ 31,600,000 |
Total capitalized stock-based compensation cost | 858,000 | 1,020,000 | 800,000 |
Equity-classified share-settled awards | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 19,394,000 | ||
Total capitalized stock-based compensation cost | 817,000 | 1,020,000 | 800,000 |
Liability-classified cash-settled awards | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 1,002,000 | 0 | 0 |
Total capitalized stock-based compensation cost | $ 41,000 | $ 0 | $ 0 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) | 12 Months Ended | ||||
Nov. 04, 2019 shares | Feb. 25, 2023 USD ($) installment $ / shares shares | Feb. 26, 2022 USD ($) $ / shares shares | Feb. 27, 2021 USD ($) shares | Feb. 29, 2020 $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Total stock-based compensation expense | $ | $ 20,396,000 | $ 35,064,000 | $ 31,600,000 | ||
Total capitalized stock-based compensation cost | $ | $ 858,000 | $ 1,020,000 | $ 800,000 | ||
Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unvested awards (in shares) | 482,000 | 472,000 | |||
Weighted average fair value (in dollars per share) | $ / shares | $ 12.25 | $ 32.38 | |||
Payment and vesting of performance stock units (in shares) | 168,000 | ||||
Vested (in dollars per share) | $ / shares | $ 38.44 | ||||
Awards granted (in shares) | 392,000 | ||||
Restricted Stock Awards | Cindy Davis, Chief Brand Officer and President, Decorist | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Awards vested, termination (in shares) | 160,255 | ||||
Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unvested awards (in shares) | 558,000 | 2,600,000 | |||
Weighted average fair value (in dollars per share) | $ / shares | $ 15.20 | $ 17.07 | |||
Payment and vesting of performance stock units (in shares) | 1,414,000 | ||||
Vested (in dollars per share) | $ / shares | $ 15.29 | ||||
Awards granted (in shares) | 262,000 | ||||
Restricted Stock Units, Cash-Settled | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
RSU liability | $ | $ 500,000 | ||||
Payment for RSUs | $ | $ 700,000 | ||||
Unvested awards (in shares) | 1,280,000 | 57,000 | |||
Weighted average fair value (in dollars per share) | $ / shares | $ 8.17 | $ 23.44 | |||
Payment and vesting of performance stock units (in shares) | 144,000 | ||||
Vested (in dollars per share) | $ / shares | $ 9.89 | ||||
Awards granted (in shares) | 2,356,000 | ||||
The 2012 and 2018 Plans | Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period commencement | 1 year | ||||
Option grant expiration period | 8 years | ||||
Number of stock options forfeited (in shares) | 822,633 | ||||
Options outstanding (in shares) | 0 | ||||
The 2012 and 2018 Plans | Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expense | $ | $ 2,800,000 | ||||
Weighted average recognition period | 1 year 4 months 24 days | ||||
The 2012 and 2018 Plans | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period commencement | 1 year | ||||
The 2012 and 2018 Plans | Restricted Stock Units, Share-Settled | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expense | $ | $ 5,500,000 | ||||
Weighted average recognition period | 1 year 4 months 24 days | ||||
The 2012 and 2018 Plans | Restricted Stock Units, Cash-Settled | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expense | $ | $ 1,300,000 | ||||
Weighted average recognition period | 2 years 1 month 6 days | ||||
The 2012 and 2018 Plans | Performance Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expense | $ | $ 5,200,000 | ||||
Weighted average recognition period | 2 years | ||||
Unvested awards (in shares) | 1,483,000 | 1,298,000 | |||
Weighted average fair value (in dollars per share) | $ / shares | $ 6.33 | $ 19.55 | |||
Payment and vesting of performance stock units (in shares) | 666,000 | ||||
Vested (in dollars per share) | $ / shares | $ 15.81 | ||||
Awards granted (in shares) | 2,143,000 | ||||
The 2012 and 2018 Plans | Minimum | Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 3 | ||||
The 2012 and 2018 Plans | Minimum | Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 5 | ||||
Vesting period commencement | 1 year | ||||
The 2012 and 2018 Plans | Minimum | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 1 | ||||
Vesting period commencement | 1 year | ||||
The 2012 and 2018 Plans | Maximum | Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 5 | ||||
The 2012 and 2018 Plans | Maximum | Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 7 | ||||
Vesting period commencement | 3 years | ||||
The 2012 and 2018 Plans | Maximum | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 3 | ||||
The 2018 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common shares authorized for issuance (in shares) | 4,600,000 | ||||
The 2012 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common shares authorized for issuance (in shares) | 43,200,000 | ||||
Weighted average fair value for stock options granted (in dollars per share) | $ / shares | $ 4.18 | ||||
Options exercised (in shares) | 0 | 0 | |||
Inducement Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Inducement award threshold percentage of stock ownership | 50% | ||||
Inducement Awards | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period commencement | 1 year | ||||
Unrecognized compensation expense | $ | $ 1,600,000 | ||||
Weighted average recognition period | 1 year 2 months 12 days | ||||
Unvested awards (in shares) | 437 | ||||
Weighted average fair value (in dollars per share) | $ / shares | $ 6.10 | ||||
Payment and vesting of performance stock units (in shares) | 437 | ||||
Vested (in dollars per share) | $ / shares | $ 6.09 | ||||
Awards granted (in shares) | 816,158 | ||||
Inducement Awards | Performance Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period commencement | 2 years | ||||
Awards granted (in shares) | 273,735 | ||||
Inducement Awards | Minimum | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 1 | ||||
Inducement Awards | Maximum | Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of equal annual installments | installment | 3 |
Stock-Based Compensation - Chan
Stock-Based Compensation - Changes in the Company's Restricted Stock (Details) shares in Thousands | 12 Months Ended |
Feb. 25, 2023 $ / shares shares | |
Restricted Stock Awards | |
Number of Restricted Shares | |
Unvested awards, beginning of period (in shares) | shares | 472 |
Granted (in shares) | shares | 392 |
Vested (in shares) | shares | (168) |
Forfeited (in shares) | shares | (214) |
Unvested awards, end of period (in shares) | shares | 482 |
Weighted Average Grant-Date Fair Value | |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 32.38 |
Granted (in dollars per share) | $ / shares | 4.90 |
Vested (in dollars per share) | $ / shares | 38.44 |
Forfeited (in dollars per share) | $ / shares | 22.63 |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 12.25 |
Restricted Stock Units | |
Number of Restricted Shares | |
Unvested awards, beginning of period (in shares) | shares | 2,600 |
Granted (in shares) | shares | 262 |
Vested (in shares) | shares | (1,414) |
Forfeited (in shares) | shares | (890) |
Unvested awards, end of period (in shares) | shares | 558 |
Weighted Average Grant-Date Fair Value | |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 17.07 |
Granted (in dollars per share) | $ / shares | 6.78 |
Vested (in dollars per share) | $ / shares | 15.29 |
Forfeited (in dollars per share) | $ / shares | 18.04 |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 15.20 |
Restricted Stock Units, Cash-Settled | |
Number of Restricted Shares | |
Unvested awards, beginning of period (in shares) | shares | 57 |
Granted (in shares) | shares | 2,356 |
Vested (in shares) | shares | (144) |
Forfeited (in shares) | shares | (989) |
Unvested awards, end of period (in shares) | shares | 1,280 |
Weighted Average Grant-Date Fair Value | |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 23.44 |
Granted (in dollars per share) | $ / shares | 8.71 |
Vested (in dollars per share) | $ / shares | 9.89 |
Forfeited (in dollars per share) | $ / shares | 10.10 |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 8.17 |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance Stock Units (Details) - Performance Stock Units | 12 Months Ended |
Feb. 25, 2023 | |
2019 Fiscal Year | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
2019 Fiscal Year | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target award percentage | 0% |
2019 Fiscal Year | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target award percentage | 150% |
2020 Fiscal Year | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
2020 Fiscal Year | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target award percentage | 0% |
2020 Fiscal Year | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target award percentage | 150% |
2021 Fiscal Year | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
2021 Fiscal Year | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target award percentage | 0% |
2021 Fiscal Year | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target award percentage | 200% |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions Used to Estimate the Black-Scholes Fair Value of Performance Share Units Granted (Details) - Performance Stock Units - The 2012 and 2018 Plans | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk free interest rate | 3.55% | 0.29% | 0.25% |
Expected dividend yield | 0% | 0% | 0% |
Expected volatility | 55% | 52.21% | 51.47% |
Expected term | 3 years | 3 years | 3 years |
Stock-Based Compensation - Ch_2
Stock-Based Compensation - Changes in the Company's Performance Stock Units (Details) - Performance Stock Units - The 2012 and 2018 Plans shares in Thousands | 12 Months Ended |
Feb. 25, 2023 $ / shares shares | |
Number of Performance Stock Units | |
Unvested awards, beginning of period (in shares) | shares | 1,298 |
Granted (in shares) | shares | 2,143 |
Vested (in shares) | shares | (666) |
Forfeited (in shares) | shares | (1,292) |
Unvested awards, end of period (in shares) | shares | 1,483 |
Weighted Average Grant-Date Fair Value | |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 19.55 |
Granted (in dollars per share) | $ / shares | 6.79 |
Vested (in dollars per share) | $ / shares | 15.81 |
Forfeited (in dollars per share) | $ / shares | 15.49 |
Unvested shares, beginning of period (in dollars per share) | $ / shares | $ 6.33 |
Stock-Based Compensation - As_2
Stock-Based Compensation - Assumptions Used to Estimate the Black-Scholes Fair Value of Stock Options Granted (Details) - Stock Options | 12 Months Ended |
Feb. 29, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted average expected life | 7 years 7 months 6 days |
Weighted average expected volatility | 39.41% |
Weighted average risk free interest rates | 2.39% |
Expected dividend yield | 4.34% |
Provision for Income Taxes - Co
Provision for Income Taxes - Components of Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Current: | |||
Federal | $ (19,584) | $ (43,740) | $ (336,506) |
State and local | (11,485) | 3,397 | 1,211 |
Total Current | (31,069) | (40,343) | (335,295) |
Deferred: | |||
Federal | 0 | 73,006 | 150,861 |
State and local | 0 | 54,304 | (1,555) |
Total Deferred | 0 | 127,310 | 149,306 |
Total | $ (31,069) | $ 86,967 | $ (185,989) |
Provision for Income Taxes - Na
Provision for Income Taxes - Narrative (Details) $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 USD ($) state | Feb. 26, 2022 USD ($) | Feb. 27, 2021 USD ($) | |
Tax Credit Carryforward [Line Items] | |||
Net deferred tax liabilities | $ (136) | ||
Valuation allowance related to U.S. charitable contribution carryforward in the U.S. | $ 851,800 | ||
Gross unrecognized tax benefits | 92,300 | 95,500 | |
Accrued interest | 8,800 | 8,600 | |
Interest on unrecognized tax benefits | $ 300 | 500 | |
Number of states | state | 50 | ||
Deferred income taxes and tax credits | $ 3,100 | ||
Offset to selling, general and administrative expenses | 7,800 | 33,300 | |
2021 | |||
Tax Credit Carryforward [Line Items] | |||
Deferred employer payroll taxes | 18,700 | ||
2020 | |||
Tax Credit Carryforward [Line Items] | |||
Deferred employer payroll taxes | $ 152,000 | ||
Minimum | |||
Tax Credit Carryforward [Line Items] | |||
Number of years under examination | 3 years | ||
Maximum | |||
Tax Credit Carryforward [Line Items] | |||
Number of years under examination | 5 years | ||
Expiration of Statutes of Limitations | |||
Tax Credit Carryforward [Line Items] | |||
Adjustments to gross unrecognized tax benefits | $ 5,800 | ||
Canada | |||
Tax Credit Carryforward [Line Items] | |||
Canadian net deferred tax asset that more likely than not will not be realized | 56,800 | 25,200 | |
Federal | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 171,600 | ||
Federal | IRS | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | 599,700 | ||
Operating loss carryforwards, to expire | 4,600 | ||
State | California Franchise Tax Board | Enterprise Zone Credit | |||
Tax Credit Carryforward [Line Items] | |||
Net tax credit carryforward | $ 2,100 | ||
Other Assets | |||
Tax Credit Carryforward [Line Items] | |||
Net deferred tax liabilities | $ (100) |
Provision for Income Taxes - De
Provision for Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Feb. 25, 2023 | Feb. 26, 2022 |
Deferred tax assets: | ||
Inventories | $ (1,688) | $ 4,077 |
Operating lease liabilities | 396,416 | 473,397 |
Insurance | 14,077 | 6,416 |
Stock-based compensation | (1,005) | 1,592 |
Merchandise credits and gift card liabilities | 62,300 | 56,690 |
Accrued expenses | 24,835 | 23,412 |
Intangibles | 1,585 | 1,685 |
Goodwill | (351) | 90 |
Carryforwards, NOLs and other tax credits | 793,163 | 189,746 |
Other | (4,920) | 34,991 |
Valuation allowance: | (908,614) | (249,529) |
Deferred tax liabilities: | ||
Depreciation | (126,324) | (146,970) |
Prepaid expenses | (5,292) | (1,155) |
Operating lease assets | (222,121) | (376,079) |
Other | (22,061) | (18,499) |
Deferred Tax Assets, Net | $ 0 | |
Deferred Tax Liabilities, Net | $ (136) |
Provision for Income Taxes - Un
Provision for Income Taxes - Unrecognized Tax Benefit Roll Forward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 25, 2023 | Feb. 26, 2022 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance at beginning of year | $ 95,518 | $ 105,749 |
Increase/(Decrease) related to current year positions | (212) | |
Increase/(Decrease) related to current year positions | 1,125 | |
Decrease related to prior year positions | 485 | |
Decrease related to prior year positions | (1,902) | |
Settlements | (2,340) | (2,340) |
Lapse of statute of limitations | (1,113) | (7,114) |
Balance at end of year | $ 92,338 | $ 95,518 |
Provision for Income Taxes - Ef
Provision for Income Taxes - Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 21% | 21% | 21% |
State income tax rate, net of federal impact | 2.66% | 3.87% | 3.94% |
Uncertain tax positions | 0% | 2.16% | 1.63% |
Goodwill non-deductible impairment charges | 0% | 0% | 0% |
Tax deficiencies related to stock-based compensation | (0.07%) | (0.81%) | (3.18%) |
Tax credits | 0.03% | 0.38% | 0.41% |
CARES Act | 0% | 0.94% | 35.98% |
Valuation Allowance | (18.94%) | (48.01%) | (7.74%) |
Canadian Branch Earnings | 0% | 1.60% | 0.78% |
Loss on Warrant Issuance | (3.80%) | 0% | 0% |
Other | 0% | 0.47% | 2.35% |
Total | 0.88% | (18.40%) | 55.17% |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) $ in Millions | 12 Months Ended | ||
Feb. 26, 2022 USD ($) | Feb. 27, 2021 USD ($) | Feb. 25, 2023 plan | |
Defined Benefit Plan, Plan Assets, Category [Line Items] | |||
Number of defined contribution plans | plan | 3 | ||
Defined contribution plan match | $ 6.2 | $ 10.6 | |
Plan assets, contributions by employer | 5.1 | ||
Partial settlement of divested plan recorded within loss on sale of businesses | $ 2.1 | ||
Other comprehensive (income) loss, after tax | 8.4 | ||
Other comprehensive (income) loss, tax | 3 | ||
Defined benefit pension plan liability | 3.6 | ||
Gain (loss) on disposition of business | |||
Defined Benefit Plan, Plan Assets, Category [Line Items] | |||
Net periodic benefit cost (credit) | $ 13.5 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
Asset Acquisition [Line Items] | |||
Income taxes paid | $ 5,400 | $ 5,200 | $ 4,800 |
Interest payments | 61,300 | 66,000 | 75,500 |
Property, plant and equipment acquired | 332,886 | 354,185 | 183,077 |
Accrual for capital expenditures | 0 | 63,400 | 44,600 |
Dividends payable | 300 | 900 | $ 2,100 |
Furniture and Fixtures, Held Under Finance Lease | |||
Asset Acquisition [Line Items] | |||
Property, plant and equipment acquired | $ 35,000 | $ 39,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - case | Oct. 14, 2020 | Aug. 14, 2020 |
Vitiello v. Bed Bath & Beyond Inc., et al. and Kirkland V. Bed Bath & Beyond Inc., et al. | ||
Loss Contingencies [Line Items] | ||
Number of cases | 2 | |
Salu V. Tritton, et al., Grooms v. Tritton, et al., and Mantia v. Fleming, et al. | ||
Loss Contingencies [Line Items] | ||
Number of cases | 3 | |
Grooms v. Tritton, et al., and Mantia v. Fleming, et al. | ||
Loss Contingencies [Line Items] | ||
Number of cases | 2 |
Assets Held for Sale and Dive_2
Assets Held for Sale and Divestitures (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||
Jan. 15, 2021 | Aug. 03, 2020 | Nov. 27, 2021 | Nov. 28, 2020 | Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | Oct. 24, 2020 | Feb. 14, 2020 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gain (loss) on sale of businesses, including impairment of assets held for sale | $ 0 | $ (18,221,000) | $ (1,062,000) | ||||||
Cost Plus World Market | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of business | $ 63,700,000 | ||||||||
Gain (loss) on sale of businesses, including impairment of assets held for sale | $ (72,000,000) | ||||||||
Remeasurement charge | $ 54,000,000 | ||||||||
Christmas Tree Shops | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of business | $ 233,300,000 | ||||||||
Gain (loss) on sale of businesses, including impairment of assets held for sale | $ (13,500,000) | (53,800,000) | |||||||
Linen Holdings | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gain (loss) on sale of businesses, including impairment of assets held for sale | (64,600,000) | ||||||||
Sale price | $ 10,100,000 | ||||||||
PMall | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of business | $ 244,600,000 | ||||||||
Gain (loss) on sale of businesses, including impairment of assets held for sale | $ 189,300,000 | ||||||||
Sale price | $ 245,000,000 | ||||||||
Proposed sale price | $ 252,000,000 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event | 2 Months Ended | ||
Jun. 13, 2023 USD ($) claim | Apr. 24, 2023 USD ($) wk | Apr. 23, 2023 USD ($) | |
Subsequent Event [Line Items] | |||
Debtor-in possession compliance period | wk | 13 | ||
Number of claims | claim | 2,413 | ||
Amount of claims | $ 181,700,000 | ||
DIP Credit Agreement | |||
Subsequent Event [Line Items] | |||
Debtor-in possession reorganization plan period | 120 days | ||
DIP Credit Agreement | Senior Secured Term Loan Facility | |||
Subsequent Event [Line Items] | |||
Debtor-in-possession financing, amount arranged | $ 240,000,000 | ||
DIP Credit Agreement | Single Draw Term Loan Facility | |||
Subsequent Event [Line Items] | |||
Debtor-in-possession financing, amount arranged | $ 40,000,000 | ||
DIP Credit Agreement | FILO Facility | |||
Subsequent Event [Line Items] | |||
Debtor-in-possession financing, amount arranged | $ 200,000,000 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 27, 2021 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 22.2 | $ 36.2 | $ 71.6 |
Additions Charged to Income | 101 | 227.1 | 259.8 |
Adjustments and/or Deductions | (116.2) | (241.1) | (295.2) |
Balance at End of Period | $ 7 | $ 22.2 | $ 36.2 |