|BBBY||BED BATH & BEYOND INC.||14.15||-0.90||-5.98%|
The retailer posted a third quarter net loss $276 million, or $2.78 per share, down from a loss of $75 million, or 61 cents, a year ago. Adjusted for one-time items, the loss was 25 cents a share. Net sales slid for the second consecutive quarter to $1.88 billion, down 28% compared to $2.62 billion a year ago, while overall comparable sales declined 7% year-over-year.
Bed Bath & Beyond banner comparable sales fell 10% year-over-year, with destination categories such as bedding, bath, kitchen food prep, indoor decor and home organization, which represent approximately two-thirds of the banner's total sales, declining 13% year-over-year.
Meanwhile, the buybuy BABY banner delivered its fourth consecutive quarter of comparable sales growth, increasing in the midteens compared to a year ago and driven by double-digit store growth and high-single digit digital growth.
Though Bed Bath & Beyond CEO Mark Tritton admitted the company's quarterly sales momentum was "not where we wanted it to be," he emphasized that the company is on track to achieve approximately $1.3 billion in sales in the first year of its transformation, ahead of its investor day goals, and that it continues to improve profitability and market share.
The company noted its Beyond+ loyalty program grew by nearly half a million members in the third quarter and that its adjusted gross margin rate has significantly exceeded its plans and is above 2020 and 2019 due to market driven pricing, promo optimization and product mix actions to fight a sharp increase in inflation and pervasive freight and supply chain headwinds.
So far, Bed Bath & Beyond has closed 170 locations as part of its three-year transformation and it expects to close 200 stores by the end of the year.
In addition to announcing its own digital marketplace and a collaboration with Kroger, Bed Bath & Beyond is looking to expand its portfolio of Owned Brands to buybuy BABY in 2022 given the business' stabilized sales results. The company also expects to complete its $1 billion three-year share repurchase plan by the end of fiscal year 2021, two years ahead of schedule.
Looking ahead, the company anticipates approximately $2.1 billion in sales from its core businesses in the fourth quarter. On a comparable sales basis, Bed Bath & Beyond expects a high-single digit decline compared to the same period a year ago and adjusted earnings per share of up to 15 cents. Bed Bath & Beyond is also revising its full-year outlook to a net sales forecast of approximately $7.9 billion, comparable sales growth in the high-single digits, and an adjusted earnings per share loss of up to 15 cents.