Bed Bath & Beyond Inc. (NASDAQ:BBBY) released its third-quarter financial results after market closed on Jan. 8. The New Jersey-based home goods retailer posted quarterly earnings and revenue that lagged behind Wall Street’s estimates.
Retailers like Amazon (NASDAQ:AMZN), Wal-Mart (NYSE:WMT) and Target (NYSE:TGT) have consistently put pressure on Bed Bath as they expand the offerings in their stores and online websites.
Bed Bath & Beyond’s results were also weighed down by one less week of holiday sales, which was due to the calendar shift of Thanksgiving.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="By the numbers ” data-reactid=”20″>By the numbers
The company registered an adjusted loss per share of 38 cents on revenue of $2.76 billion. Analysts had projected earnings of 2 cents per share on $2.85 billion in revenue.
Comparable store sales crumbled 8.3%, which exceeded the 5% decline analysts had anticipated. Comps plunged 3.6% in the quarter after adjusting for the calendar shift of Thanksgiving.
Reflecting on the quarter’s performance, company’s president and CEO Mark J. Tritton commented:
“Our performance in the third quarter was unsatisfactory and underscores the imperative for change and strengthens our sense of priorities and purpose. We must respond to the challenges we face as a business, including pressured sales and profitability, and reconstruct a modern, durable model for long-term profitable growth.”
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The company plans to close 40 stores in fiscal 2019, which is less than what it had previously forecasted (60 stores). It said it would delay closing 20 stores so that it can sell more of its inventory in the first half of fiscal 2020.
The company has approximately 1,500 locations currently.
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On Monday, the company completed a sale-leaseback transaction with an affiliate of Oak Street Real Estate capital. The deal fetched the company $250 million of net proceeds. The company sold nearly 2.1 million square feet of commercial real estate to the firm and would lease it back.
Mark Triton said that the deal “marks the first step toward unlocking valuable capital… that can be put to work to amplify our plans to build a stronger, more efficient foundation to support revenue growth, financial stability and enhance shareholder value.”
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The retailer did not provide guidance for full fiscal 2019. However, it said that the fourth quarter earnings and revenue are predicted to decline.
Disclosure: I do not hold any positions in the stocks mentioned.
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