Exhibit 99.1
BED BATH & BEYOND INC. REPORTS NET EARNINGS |
FOR FISCAL FIRST QUARTER |
· Net Earnings for quarter increase to $.35 per diluted share; |
· Quarterly Net Sales Increase by 12.2%; Quarterly Comparable Store Sales Increase by 4.9% |
UNION, New Jersey, June 21, 2006 — Bed Bath & Beyond Inc. today reported net earnings of $.35 per diluted share ($100.4 million) in the fiscal first quarter ended May 27, 2006. In the fiscal first quarter of 2005, the Company reported net earnings of $.33 per diluted share ($98.9 million). Net sales for the fiscal first quarter of 2006 were $1.396 billion, an increase of approximately 12.2% from net sales of $1.244 billion reported in the fiscal first quarter of 2005. Comparable store sales in the fiscal first quarter of 2006 increased by approximately 4.9%, compared with an increase of approximately 4.4% in last year’s fiscal first quarter.
The fiscal first quarter of 2006 results included incremental stock-based compensation expense resulting from the early adoption, at the beginning of the fiscal third quarter of 2005, of Statement of Financial Accounting Standards 123(R).
As of May 27, 2006, the Company operated a total of 819 stores including 751 Bed Bath & Beyond stores (10 of which were opened during the fiscal first quarter) in 46 states, the District of Columbia and Puerto Rico. In addition, as of that date, Christmas Tree Shops, Inc. operated 30 stores (one of which opened during the fiscal first quarter) in 8 states, and Harmon Stores, Inc. operated 38 stores in 3 states. Consolidated store space as of May 27, 2006 was approximately 25.8 million square feet. Since the beginning of the fiscal second quarter on May 28, 2006, 3 new Bed Bath & Beyond stores and one Christmas Tree Shops store have been opened.
* * * * * * * * *
Bed Bath & Beyond Inc. and subsidiaries (the “Company”) is a nationwide chain of retail stores, operating under the names Bed Bath & Beyond, Christmas Tree Shops and Harmon. The Company sells a wide assortment of merchandise principally including domestics merchandise and home furnishings as well as food, giftware and health and beauty care items. Shares of Bed Bath & Beyond Inc. are traded on NASDAQ under the symbol “BBBY” and are included in the Standard & Poor’s 500 and Global 1200 Indices and the NASDAQ-100 Index. The Company is counted among the Fortune 500 and the Forbes 2000.
This press release may contain forward-looking statements. Many of these forward-looking statements can be identified by use of words such as may, will, expect, anticipate, estimate, assume, continue, project, plan and similar words and phrases. The Company’s actual results and future financial condition may differ materially from those expressed in any such forward-looking statements as a result of many factors that may be outside the Company’s control. Such factors include, without limitation: changes in the retailing environment and consumer preferences and spending habits; demographics and other macroeconomic factors that may impact the level of spending for the types of merchandise sold by the Company; general economic conditions; unusual weather patterns; competition from existing and potential competitors; competition from other channels of distribution; pricing pressures; the cost of labor, merchandise and other costs and expenses; and the ability to find suitable locations at acceptable occupancy costs to support the Company’s expansion program. The Company does not undertake any obligation to update its forward-looking statements.
INVESTOR RELATIONS CONTACTS (at 908-688-0888; Fax 908-810-8813)
Ronald Curwin Ext. 4550
Kenneth C. Frankel Ext. 4554
Paula J. Marbach Ext. 4552
(Tables Follow)
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BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(in thousands, except per share data)
(unaudited)
| | Three Months Ended | |
| | May 27,
2006 | | May 28,
2005 | |
Net sales | | $ | 1,395,963 | | $ | 1,244,421 | |
| | | | | |
Cost of sales | | 805,865 | | 723,640 | |
| | | | | |
Gross profit | | 590,098 | | 520,781 | |
| | | | | |
Selling, general and administrative expenses | | 441,348 | | 369,897 | |
| | | | | |
Operating profit | | 148,750 | | 150,884 | |
| | | | | |
Interest income | | 9,659 | | 7,108 | |
| | | | | |
Earnings before provision for income taxes | | 158,409 | | 157,992 | |
| | | | | |
Provision for income taxes | | 57,978 | | 59,089 | |
| | | | | |
Net earnings | | $ | 100,431 | | $ | 98,903 | |
| | | | | |
Net earnings per share—Basic | | $ | 0.36 | | $ | 0.34 | |
Net earnings per share—Diluted | | $ | 0.35 | | $ | 0.33 | |
| | | | | |
Weighted average shares outstanding—Basic | | 280,202 | | 294,413 | |
Weighted average shares outstanding—Diluted | | 285,153 | | 299,055 | |
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BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, unaudited)
| | May 27,
2006 | | May 28,
2005 | |
| | | | | |
Assets | | | | | |
| | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ | 87,795 | | $ | 224,528 | |
Short term investment securities | | 554,472 | | 651,983 | |
Merchandise inventories | | 1,391,048 | | 1,238,976 | |
Other current assets | | 135,302 | | 108,943 | |
| | | | | |
Total current assets | | 2,168,617 | | 2,224,430 | |
| | | | | |
Long term investment securities | | 413,424 | | 362,436 | |
Property and equipment, net | | 765,101 | | 616,315 | |
Other assets | | 185,617 | | 169,161 | |
| | $3,532,759 | | $ | 3,372,342 | |
| | | | | |
Liabilities and Shareholders’ Equity | | | | | |
| | | | | |
Current liabilities: | | | | | |
Accounts payable | | $ | 551,244 | | $ | 481,949 | |
Accrued expenses and other current liabilities | | 240,584 | | 255,429 | |
Merchandise credit and gift card liabilities | | 120,043 | | 92,660 | |
Income taxes payable | | 98,690 | | 89,955 | |
| | | | | |
Total current liabilities | | 1,010,561 | | 919,993 | |
| | | | | |
Deferred rent and other liabilities | | 137,727 | | 132,046 | |
| | | | | |
Total liabilities | | 1,148,288 | | 1,052,039 | |
| | | | | |
Total shareholders’ equity | | 2,384,471 | | 2,320,303 | |
| | $3,532,759 | | $ | 3,372,342 | |
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BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands, unaudited)
| | Three Months Ended | |
| | May 27,
2006 | | May 28,
2005 (1) | |
| | | | | |
Cash Flows from Operating Activities: | | | | | |
| | | | | |
Net earnings | | $ | 100,431 | | $ | 98,903 | |
Adjustments to reconcile net earnings to net cash | | | | | |
provided by operating activities: | | | | | |
Depreciation | | 30,775 | | 25,760 | |
Amortization of bond premium | | 1,037 | | 1,787 | |
Stock-based compensation | | 12,977 | | — | |
Excess tax benefit from stock-based compensation | | 1,204 | | 7,873 | |
Deferred income taxes | | (10,425 | ) | (325 | ) |
Increase in assets: | | | | | |
Merchandise inventories | | (89,328 | ) | (86,948 | ) |
Trading investment securities | | (754 | ) | — | |
Other current assets | | (14,503 | ) | (13,847 | ) |
Other assets | | (6 | ) | (45 | ) |
Increase (decrease) in liabilities: | | | | | |
Accounts payable | | 38,419 | | 41,495 | |
Accrued expenses and other current liabilities | | (8,555 | ) | 738 | |
Merchandise credit and gift card liabilities | | 6,529 | | 5,599 | |
Income taxes payable | | 6,660 | | 8,591 | |
Deferred rent and other liabilities | | 7,583 | | 8,130 | |
| | | | | |
Net cash provided by operating activities | | 82,044 | | 97,711 | |
| | | | | |
Cash Flows from Investing Activities: | | | | | |
| | | | | |
Purchase of held-to-maturity investment securities | | (97,194 | ) | (102,736 | ) |
Redemption of held-to-maturity investment securities | | 55,715 | | 10,715 | |
Purchase of available-for-sale investment securities | | (396,175 | ) | (515,975 | ) |
Redemption of available-for-sale investment securities | | 267,450 | | 546,300 | |
Capital expenditures | | (78,722 | ) | (42,398 | ) |
| | | | | |
Net cash used in investing activities | | (248,926 | ) | (104,094 | ) |
| | | | | |
Cash Flows from Financing Activities: | | | | | |
| | | | | |
Proceeds from exercise of stock options | | 6,229 | | 8,803 | |
Excess tax benefit from stock-based compensation | | 1,508 | | — | |
Repurchase of common stock | | (757 | ) | — | |
| | | | | |
Net cash provided by financing activities | | 6,980 | | 8,803 | |
| | | | | |
Net (decrease) increase in cash and cash equivalents | | (159,902 | ) | 2,420 | |
| | | | | |
Cash and cash equivalents: | | | | | |
Beginning of period | | 247,697 | | 222,108 | |
End of period | | $ | 87,795 | | $ | 224,528 | |
| | | | | |
(1) Reflects the accrual for purchases of capital expenditures as a non-cash investing activity to conform with current presentation.
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