Bed Bath & Beyond Inc. Reports Results For Fiscal Third Quarter - Net Earnings per Diluted Share of $1.03 - Quarterly Net Sales Increase by Approximately 15.3% - Quarterly Comparable Store Sales Increase by Approximately 1.7% - Board of Directors Authorizes a New $2.5 Billion Share Repurchase Program - Modeling Fiscal Fourth Quarter 2012 Net Earnings per Diluted Share of Approximately $1.60 to $1.67 - Modeling Full Year Net Earnings per Diluted Share to Increase by Approximately 10% to 12%, Consistent with Prior Estimates PR Newswire UNION, N.J., Dec. 19, 2012 UNION, N.J., Dec. 19, 2012 /PRNewswire/ --Bed Bath & Beyond Inc. today reported net earnings of $1.03 per diluted share ($232.8 million) in the fiscal third quarter ended November 24, 2012, an increase of approximately 8.4% versus net earnings of $.95 per diluted share ($228.5 million) in the same quarter a year ago. Net sales for the fiscal third quarter of 2012 were approximately $2.702 billion, an increase of approximately 15.3% from net sales of approximately $2.344 billion reported in the fiscal third quarter of 2011. Comparable store sales in the fiscal third quarter of 2012 increased by approximately 1.7%, compared with an increase of approximately 4.1% in last year's fiscal third quarter. The Company estimates that the impact of Hurricane Sandy reduced its comparable store sales percentage during the fiscal third quarter by approximately 0.9%. The Company is pleased to announce that its Board of Directors has authorized a new $2.5 billion share repurchase program. The Company is currently planning that the new share repurchase program will commence after completion of the existing share repurchase program.During the fiscal third quarter of 2012, the Company repurchased approximately $191 million of its common stock, representing approximately 3.1 million shares, under its existing share repurchase program authorized in December 2010. As of November 24, 2012, the remaining balance of the existing share repurchase program was approximately $223 million. Since 2004 through the fiscal third quarter of 2012, the Company has returned approximately $4.7 billion to our shareholders through share repurchases. "Our Board authorized this new share repurchase program based upon its continued confidence in our Company's long-term growth potential, financial outlook and cash flow generation," said Steven Temares, Chief Executive Officer and Member of the Board of Directors. "It is anticipated that this $2.5 billion share repurchase program will be funded from current cash and future cash flows. That said, our Company's Board of Directors continues to review our capital structure on an ongoing basis. In addition to providing value to our shareholders through share repurchase programs, our strong operations should allow us to continue to invest in our infrastructure and maintain our flexibility to take advantage of opportunities as they may arise." For the fiscal nine months ended November 24, 2012, the Company reported net earnings of $2.89 per diluted share ($663.9 million), an increase of approximately 11.2% over net earnings of $2.60 per diluted share ($638.5 million) in the corresponding period a year ago. Net sales for the fiscal nine months of 2012 were approximately $7.513 billion, an increase of approximately 11.0% from net sales of approximately $6.768 billion in the corresponding period a year ago. Comparable store sales for the fiscal nine months of 2012 increased by approximately 2.7%, compared with an increase of approximately 5.5% in last year's fiscal nine months. The Company is modeling net earnings per diluted share to be approximately $1.60 to $1.67 for the fiscal fourth quarter of 2012 and, consistent with prior estimates, to be approximately $4.48 to $4.54 for all of fiscal 2012, which will be 53 weeks and includes World Market and Linen Holdings from the date of each acquisition to the end of the fiscal year. The modeling of net earnings per diluted share is based upon a number of planning assumptions which will be described in the Company's third 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. The accompanying consolidated financial information includes the accounts of Linen Holdings since the date of its acquisition on June 1, 2012 and Cost Plus, Inc. ("World Market") since the date of its acquisition on June 29, 2012. Linen Holdings, a business-to-business distributor, is excluded from the comparable store sales calculations and will continue to be excluded on an ongoing basis as long as it does not meet the Company's definition of comparable store sales. World Market is excluded from the comparable store sales calculations for the fiscal third quarter and nine months of 2012, and will continue to be excluded from the comparable store sales calculations until after the anniversary of the acquisition. As of November 24, 2012, the Company had a total of 1,466 stores, including 1,003 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada, 264 stores under the names of World Market, Cost Plus World Market, or World Market Stores, 74 stores under the names of Christmas Tree Shops or andThat!, 78 buybuy BABY stores and 47 stores under the names of Harmon or Harmon Face Values. During the fiscal third quarter, the Company opened four Bed Bath & Beyond stores, seven buybuy BABY stores, six World Market stores and one andThat! store while closing one Bed Bath & Beyond store. Consolidated store space as of November 24, 2012 was approximately 41.9 million square feet. Since the beginning of the fourth quarter of fiscal 2012 on November 25, 2012, one Bed Bath & Beyond store and two buybuyBABY stores have been opened. 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, World Market, Cost Plus World Market, World Market Stores, Christmas Tree Shops, andThat!, 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 the acts of third parties; changes to statutory, regulatory and legal requirements; changes to, or new, tax laws or interpretation of existing tax laws; changes to, or new, accounting standards including, without limitation, changes to lease accounting standards; and the integration of acquired businesses. The Company does not undertake any obligation to update its forward-looking statements. BED BATH & BEYOND INC. AND SUBSIDIARIES Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Three Months Ended Nine Months Ended November November November November 24, 26, 24, 26, 2012 2011 2012 2011 Net sales $ 2,701,801 $ 2,343,561 $ 7,513,108 $ 6,767,576 Cost of sales 1,627,791 1,384,868 4,519,230 4,000,312 Gross profit 1,074,010 958,693 2,993,878 2,767,264 Selling, general and 712,361 601,673 1,953,694 1,749,660 administrative expenses Operating profit 361,649 357,020 1,040,184 1,017,604 Interest expense, net (3,122) (602) (3,909) (1,922) Earnings before provision for income 358,527 356,418 1,036,275 1,015,682 taxes Provision for income 125,777 127,874 372,359 377,188 taxes Net earnings $ 232,750 $ 228,544 $ 663,916 $ 638,494 Net earnings per share - $ 1.04 $ 0.96 $ 2.93 $ 2.64 Basic Net earnings per share - $ 1.03 $ 0.95 $ 2.89 $ 2.60 Diluted Weighted average shares 223,687 237,802 226,362 242,033 outstanding - Basic Weighted average shares 226,661 241,718 229,551 246,019 outstanding - Diluted BED BATH & BEYOND INC. AND SUBSIDIARIES Consolidated Balance Sheets (in thousands, unaudited) November 24, November 26, 2012 2011 Assets Current assets: Cash and cash equivalents $ 672,262 $ 765,750 Short term investment securities 112,450 761,930 Merchandise inventories 2,763,907 2,357,254 Other current assets 419,234 405,950 Total current assets 3,967,853 4,290,884 Long term investment securities 74,668 101,864 Property and equipment, net 1,433,592 1,160,994 Other assets 910,723 301,374 $ 6,386,836 $ 5,855,116 Liabilities and Shareholders' Equity Current liabilities: Accounts payable $ 1,088,651 $ 954,281 Accrued expenses and other current 423,202 346,871 liabilities Merchandise credit and gift card 235,789 197,932 liabilities Current income taxes payable 89,271 2,444 Total current liabilities 1,836,913 1,501,528 Deferred rent and other liabilities 479,164 318,814 Income taxes payable 93,637 124,262 Total liabilities 2,409,714 1,944,604 Total shareholders' equity 3,977,122 3,910,512 $ 6,386,836 $ 5,855,116 BED BATH & BEYOND INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (in thousands, unaudited) Nine Months Ended November 24, November 26, 2012 2011 Cash Flows from Operating Activities: Net earnings $ 663,916 $ 638,494 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 139,411 131,989 Stock-based compensation 34,591 34,682 Tax benefit from stock-based 13,056 (430) compensation Deferred income taxes (13,897) 13,596 Other 826 (1,262) (Increase) decrease in assets, net of effect of acquisitions: Merchandise inventories (496,100) (388,347) Trading investment securities (3,508) (882) Other current assets (86,975) (55,697) Other assets (10,655) 903 Increase (decrease) in liabilities, net of effect of acquisitions: Accounts payable 292,305 238,495 Accrued expenses and other current 8,398 33,663 liabilities Merchandise credit and gift card 21,196 4,871 liabilities Income taxes payable 32,110 (97,435) Deferred rent and other 12,742 15,850 liabilities Net cash provided by operating activities 607,416 568,490 Cash Flows from Investing Activities: Purchase of held-to-maturity investment (393,578) (1,277,815) securities Redemption of held-to-maturity investment 1,031,249 1,128,125 securities Redemption of available-for-sale investment 31,715 15,550 securities Capital expenditures (238,405) (159,244) Payment for acquisitions, net of cash acquired (668,609) - Payment for acquisition of trademarks (40,000) - Net cash used in investing activities (277,628) (293,384) Cash Flows from Financing Activities: Proceeds from exercise of stock options 31,660 161,705 Excess tax benefit from stock-based 3,885 4,638 compensation Repurchase of common stock, including fees (696,237) (859,286) Net cash used in financing activities (660,692) (692,943) Net decrease in cash and cash equivalents (330,904) (417,837) Cash and cash equivalents: Beginning of period 1,003,166 1,183,587 End of period $ 672,262 $ 765,750 SOURCE Bed Bath & Beyond Inc. Website: http://www.bedbathandbeyond.com Contact: Kenneth C. Frankel, +1-908-855-4554; or Eugene A. Castagna, +1-908-855-4110
Bed Bath & Beyond Inc. Reports Results For Fiscal Third Quarter
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