Bed Bath & Beyond Earns $1.80 Per Share

Bed Bath & Beyond (BBBY) earned $1.80 per share for fiscal Q4 which is largely what was expected. Their outlook, however, was weak. The company sees Q1 earnings between 90 and 95 cents per share. The stock is off by 3% in the after-hours market.

From the earnings report:

For the fourth quarter of fiscal 2014, the Company reported net earnings of $1.80 per diluted share ($321.1 million) compared with net earnings for the fourth quarter of fiscal 2013 of $1.60 per diluted share ($333.3 million). Net sales for the fourth quarter of fiscal 2014 were approximately $3.337 billion, an increase of approximately 4.2% from net sales of approximately $3.203 billion reported in the fourth quarter of fiscal 2013. Comparable sales in the fourth quarter of fiscal 2014 increased by approximately 3.7%, compared with an increase of approximately 1.7% in last year’s fiscal fourth quarter. Comparable sales for the fourth quarter of fiscal 2014 include an approximate 0.2% unfavorable impact from the change in the Canadian currency exchange rate.

For the fiscal full year ended February 28, 2015, the Company reported net earnings of $5.07 per diluted share ($957.5 million) compared with $4.79 per diluted share ($1.022 billion) in the full year of fiscal 2013. Net sales for fiscal 2014 were approximately $11.881 billion, an increase of approximately 3.3% from net sales of approximately $11.504 billion in fiscal 2013. Comparable sales for both fiscal 2014 and fiscal 2013 increased by approximately 2.4%.

Cost Plus World Market was excluded from the comparable sales calculations through the end of the fiscal first half of 2013 and is included beginning with the fiscal third quarter of 2013. Linen Holdings is excluded from the comparable sales calculations and will continue to be excluded on an ongoing basis because it represents non-retail activity.

Share Repurchase Program

During the fourth quarter of fiscal 2014, the Company repurchased approximately $947 million of its common stock, representing approximately 11.8 million shares. Of this total, approximately $782 million, representing approximately 10.3 million shares, were from open market repurchases, and the remaining $165 million and 1.5 million shares represented the net settlement at the completion of the Company’s $1.1 billion accelerated share repurchase program in December 2014. As of February 28, 2015, the remaining balance of the current $2.0 billion share repurchase program was approximately $884 million.

Fiscal 2015 Financial Model

The Company is modeling a 2.0% to 3.0% increase for comparable sales for both the fiscal 2015 first quarter and full year, net earnings per diluted share to be between $.90 to $.95 for the first quarter of fiscal 2015, and to be between relatively flat and a mid-single digit percentage increase for the fiscal full year. The Company’s fiscal 2015 model includes the impact of approximately $.24 per diluted share related to four non-comparable items between its 2014 results and its 2015 model. These non-comparable items are: an increase in the 2015 tax rate due to a reduction in the amount of distinct tax events modeled in fiscal 2015; a credit card fee litigation settlement benefit in fiscal 2014 that is not expected to reoccur in 2015; the modeled unfavorable foreign currency exchange rate impact in 2015; and an increase in investments in compensation and benefits in 2015 beyond those historically planned. The modeling of net earnings per diluted share is based upon a number of assumptions which will be described in the Company’s fourth quarter of fiscal 2014 conference call. Information regarding access to the call is available in the Investor Relations section of the Company’s website.

Posted by on April 8th, 2015 at 4:22 pm


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