Exhibit 99.1
BED BATH & BEYOND INC. REPORTS RESULTS
FOR FISCAL FIRST QUARTER
· Net Earnings per Diluted Share of $.89
· Quarterly Net Sales Increase by Approximately 5.1%
· Quarterly Comparable Store Sales Increase by Approximately 3.0%
· Modeling Fiscal Second Quarter 2012 Net Earnings per Diluted Share of Approximately $.97 to $1.03
· Continues to Model Fiscal 2012 Net Earnings per Diluted Share to Increase by a High Single to a Low Double Digit Percentage Range
UNION, New Jersey, June 20, 2012 — Bed Bath & Beyond Inc. today reported net earnings of $.89 per diluted share ($206.8 million) in the fiscal quarter ended May 26, 2012, an increase of approximately 24% versus net earnings of $.72 per diluted share ($180.6 million) in the same quarter a year ago. Net sales for the fiscal first quarter of 2012 were approximately $2.218 billion, an increase of approximately 5.1% from net sales of approximately $2.110 billion reported in the fiscal first quarter of 2011. Comparable store sales in the fiscal first quarter of 2012 increased by approximately 3.0%, compared with an increase of approximately 7.0% in last year’s fiscal first quarter.
During the fiscal first quarter of 2012, the Company repurchased approximately $306 million of its common stock representing approximately 4.6 million shares. As of May 26, 2012, the remaining balance of the current share repurchase program authorized in December 2010 was approximately $613 million.
The Company is modeling net earnings per diluted share to be approximately $.97 to $1.03 for the fiscal second quarter and continues to model net earnings per diluted share to increase by a high single to a low double digit percentage range for all of fiscal 2012, which will be 53 weeks. The modeling of net earnings per diluted share is based upon a number of planning assumptions which will be described in the Company’s first quarter of fiscal 2012 conference call. Information regarding access to the call is available in the Investor Relations section of the Company’s website, www.bedbathandbeyond.com.
As announced on May 9, 2012, the Company entered into a definitive agreement to acquire all of the outstanding shares of Cost Plus, Inc., a retailer selling a wide range of home decorating items, furniture, gifts, holiday and other seasonal items, and gourmet food and beverages. While the Company expects the tender offer for Cost Plus, Inc.’s outstanding shares to be completed during the fiscal second quarter, the Company’s planning assumptions and modeled net earnings per diluted share for the fiscal second quarter and full year 2012 exclude Cost Plus, Inc. as the transaction has not yet been completed.
Assuming the tender offer is completed as anticipated during the fiscal second quarter of 2012, the Company’s modeling of net earnings per diluted share, including transaction and integration costs, would decrease by several cents for the fiscal second quarter. For the fiscal second half, net earnings per diluted share, including integration costs, would increase and be slightly accretive. For fiscal 2012, the Company would continue to model net earnings per diluted share to increase by a high single to a low double digit percentage range over fiscal 2011.
Additionally, on June 1, 2012, the Company announced the acquisition of Linen Holdings, LLC, a business-to-business distributor of a variety of textile products, amenities and other goods to customers in the hospitality, cruise line, food service, healthcare and other industries. The benefit from Linen Holdings, LLC’s results of operations is included in the Company’s modeled net earnings per diluted share and will not have a material effect for the fiscal second quarter or for all of fiscal 2012.
As of May 26, 2012, the Company had a total of 1,180 stores, including 995 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada, 72 Christmas Tree Shops stores, 68 buybuy BABY stores and 45 stores under the names of Harmon or Harmon Face Values. During the fiscal first quarter, the Company opened two Bed Bath & Beyond stores, four buybuy BABY stores and one Christmas Tree Shops store. Consolidated store space as of May 26, 2012 was approximately 36.3 million square feet. Since the beginning of the second quarter of fiscal 2012 on May 27, 2012, the Company has opened two Bed Bath & Beyond stores and three buybuy BABY stores. In addition, the Company is a partner in a joint venture which operates two stores in the Mexico City market under the name “Home & More.”
* * * * * * * *
Bed Bath & Beyond Inc. and subsidiaries (the “Company”) operates a chain of retail stores under the names of Bed Bath & Beyond, Christmas Tree Shops, Harmon, Harmon Face Values and buybuy BABY. The Company is also a partner in a joint venture which operates retail stores in Mexico under the name “Home & More.” Through its retail stores, 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, consumables and certain juvenile products. Additionally, the Company includes Linen Holdings, a business-to-business distributor of a variety of textile products, amenities and other goods to customers in the hospitality, cruise line, food service, healthcare and other industries. Shares of Bed Bath & Beyond Inc. are traded on NASDAQ under the symbol “BBBY” and are included in the Standard and 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, approximate, estimate, assume, continue, model, 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. Such factors include, without limitation: general economic conditions including the housing market, a challenging overall macroeconomic environment and related changes in the retailing environment, 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; civil disturbances and terrorist acts; unusual weather patterns and natural disasters; competition from existing and potential competitors; competition from other channels of distribution; pricing pressures; the ability to attract and retain associates in all areas of the organization; the cost of labor, merchandise and other costs and expenses; the ability to find suitable locations at acceptable occupancy costs and other terms to support the Company’s expansion program; the impact of failed auctions for auction rate securities held by the Company; uncertainty in financial markets; disruptions to the Company’s information technology systems including but not limited to security breaches of the Company’s systems protecting consumer and employee information; reputational risk arising from acts of third parties; changes to statutory, regulatory and legal requirements; changes to, or new, tax laws or interpretation of existing tax laws; and changes to, or new, accounting standards including, without limitation, changes to lease accounting standards. The Company does not undertake any obligation to update its forward-looking statements.
INVESTOR CONTACTS:
Kenneth C. Frankel (908) 855-4554
Eugene A. Castagna (908) 855-4110
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(in thousands, except per share data)
(unaudited)
|
| Three Months Ended |
| ||||
|
| May 26, |
| May 28, |
| ||
|
| 2012 |
| 2011 |
| ||
|
|
|
|
|
| ||
Net sales |
| $ | 2,218,292 |
| $ | 2,109,951 |
|
|
|
|
|
|
| ||
Cost of sales |
| 1,331,093 |
| 1,252,379 |
| ||
|
|
|
|
|
| ||
Gross profit |
| 887,199 |
| 857,572 |
| ||
|
|
|
|
|
| ||
Selling, general and administrative expenses |
| 573,801 |
| 568,624 |
| ||
|
|
|
|
|
| ||
Operating profit |
| 313,398 |
| 288,948 |
| ||
|
|
|
|
|
| ||
Interest (expense) income, net |
| (1,056 | ) | 552 |
| ||
|
|
|
|
|
| ||
Earnings before provision for income taxes |
| 312,342 |
| 289,500 |
| ||
|
|
|
|
|
| ||
Provision for income taxes |
| 105,506 |
| 108,922 |
| ||
|
|
|
|
|
| ||
Net earnings |
| $ | 206,836 |
| $ | 180,578 |
|
|
|
|
|
|
| ||
Net earnings per share - Basic |
| $ | 0.90 |
| $ | 0.74 |
|
Net earnings per share - Diluted |
| $ | 0.89 |
| $ | 0.72 |
|
|
|
|
|
|
| ||
Weighted average shares outstanding - Basic |
| 229,086 |
| 245,546 |
| ||
Weighted average shares outstanding - Diluted |
| 232,683 |
| 249,799 |
| ||
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, unaudited)
|
| May 26, |
| May 28, |
| ||
|
| 2012 |
| 2011 |
| ||
|
|
|
|
|
| ||
Assets |
|
|
|
|
| ||
|
|
|
|
|
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Current assets: |
|
|
|
|
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Cash and cash equivalents |
| $ | 1,075,184 |
| $ | 1,228,973 |
|
Short term investment securities |
| 611,325 |
| 603,901 |
| ||
Merchandise inventories |
| 2,202,846 |
| 2,083,008 |
| ||
Other current assets |
| 310,478 |
| 363,665 |
| ||
|
|
|
|
|
| ||
Total current assets |
| 4,199,833 |
| 4,279,547 |
| ||
|
|
|
|
|
| ||
Long term investment securities |
| 94,761 |
| 118,343 |
| ||
Property and equipment, net |
| 1,220,245 |
| 1,108,621 |
| ||
Other assets |
| 309,493 |
| 311,022 |
| ||
|
|
|
|
|
| ||
|
| $ | 5,824,332 |
| $ | 5,817,533 |
|
|
|
|
|
|
| ||
Liabilities and Shareholders’ Equity |
|
|
|
|
| ||
|
|
|
|
|
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Current liabilities: |
|
|
|
|
| ||
Accounts payable |
| $ | 866,253 |
| $ | 844,247 |
|
Accrued expenses and other current liabilities |
| 319,851 |
| 301,477 |
| ||
Merchandise credit and gift card liabilities |
| 223,328 |
| 192,250 |
| ||
Current income taxes payable |
| 103,042 |
| 111,418 |
| ||
|
|
|
|
|
| ||
Total current liabilities |
| 1,512,474 |
| 1,449,392 |
| ||
|
|
|
|
|
| ||
Deferred rent and other liabilities |
| 341,073 |
| 304,465 |
| ||
Income taxes payable |
| 96,216 |
| 127,899 |
| ||
|
|
|
|
|
| ||
Total liabilities |
| 1,949,763 |
| 1,881,756 |
| ||
|
|
|
|
|
| ||
Total shareholders’ equity |
| 3,874,569 |
| 3,935,777 |
| ||
|
|
|
|
|
| ||
|
| $ | 5,824,332 |
| $ | 5,817,533 |
|
BED BATH & BEYOND INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands, unaudited)
|
| Three Months Ended |
| ||||
|
| May 26, |
| May 28, |
| ||
|
| 2012 |
| 2011 |
| ||
|
|
|
|
|
| ||
Cash Flows from Operating Activities: |
|
|
|
|
| ||
|
|
|
|
|
| ||
Net earnings |
| $ | 206,836 |
| $ | 180,578 |
|
Adjustments to reconcile net earnings to net cash provided by operating activities: |
|
|
|
|
| ||
Depreciation |
| 43,410 |
| 44,221 |
| ||
Stock-based compensation |
| 12,829 |
| 13,717 |
| ||
Tax benefit from stock-based compensation |
| 11,445 |
| (3,897 | ) | ||
Deferred income taxes |
| (10,558 | ) | (14,042 | ) | ||
Other |
| (277 | ) | (454 | ) | ||
(Increase) decrease in assets: |
|
|
|
|
| ||
Merchandise inventories |
| (130,956 | ) | (114,101 | ) | ||
Trading investment securities |
| (366 | ) | (1,670 | ) | ||
Other current assets |
| (8,268 | ) | (10,726 | ) | ||
Other assets |
| (2,190 | ) | 399 |
| ||
Increase (decrease) in liabilities: |
|
|
|
|
| ||
Accounts payable |
| 119,886 |
| 139,926 |
| ||
Accrued expenses and other current liabilities |
| (12,346 | ) | (5,558 | ) | ||
Merchandise credit and gift card liabilities |
| 13,682 |
| (811 | ) | ||
Income taxes payable |
| 27,390 |
| 26,605 |
| ||
Deferred rent and other liabilities |
| 1,845 |
| 4,147 |
| ||
|
|
|
|
|
| ||
Net cash provided by operating activities |
| 272,362 |
| 258,334 |
| ||
|
|
|
|
|
| ||
Cash Flows from Investing Activities: |
|
|
|
|
| ||
|
|
|
|
|
| ||
Purchase of held-to-maturity investment securities |
| (281,130 | ) | (365,491 | ) | ||
Redemption of held-to-maturity investment securities |
| 421,875 |
| 365,625 |
| ||
Redemption of available-for-sale investment securities |
| 6,475 |
| 7,050 |
| ||
Capital expenditures |
| (70,788 | ) | (33,142 | ) | ||
|
|
|
|
|
| ||
Net cash provided by (used in) investing activities |
| 76,432 |
| (25,958 | ) | ||
|
|
|
|
|
| ||
Cash Flows from Financing Activities: |
|
|
|
|
| ||
|
|
|
|
|
| ||
Proceeds from exercise of stock options |
| 26,140 |
| 57,629 |
| ||
Excess tax benefit from stock-based compensation |
| 3,360 |
| 249 |
| ||
Repurchase of common stock, including fees |
| (306,276 | ) | (244,868 | ) | ||
|
|
|
|
|
| ||
Net cash used in financing activities |
| (276,776 | ) | (186,990 | ) | ||
|
|
|
|
|
| ||
Net increase in cash and cash equivalents |
| 72,018 |
| 45,386 |
| ||
|
|
|
|
|
| ||
Cash and cash equivalents: |
|
|
|
|
| ||
Beginning of period |
| 1,003,166 |
| 1,183,587 |
| ||
End of period |
| $ | 1,075,184 |
| $ | 1,228,973 |
|