|
|
|
(State or other jurisdiction of incorporation)
|
(Commission File Number)
|
(I.R.S. Employer Identification No.)
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
|
|
|
(Nasdaq Global Select Market)
|
Item 2.02 |
Results of Operations and Financial Condition
|
Item 7.01 |
Regulation FD Disclosure
|
Item 9.01 |
Financial Statements and Exhibits
|
Exhibit No.
|
Description
|
|
99.1
|
||
99.2
|
||
104
|
Cover Page Interactive Data File (embedded within the Inline XBRL document)
|
BED BATH & BEYOND INC.
|
||
(Registrant)
|
||
Date: June 28, 2022
|
By:
|
/s/ Gustavo Arnal
|
Gustavo Arnal
|
||
Chief Financial Officer
|
Reported (GAAP)
|
Adjusted2
|
|||||||||||||||||||||||
($ in millions, except per share data)
|
Three months ended
|
Three months ended
|
||||||||||||||||||||||
May 28,
2022
|
May 29,
2021
|
Diff
|
May 28,
2022
|
May 29,
2021 |
Diff
|
|||||||||||||||||||
Net Sales
|
$
|
1,463
|
$
|
1,954
|
(25
|
)%
|
$
|
1,463
|
$
|
1,954
|
(25
|
)%
|
||||||||||||
Comparable1 Sales
|
(23
|
)%
|
||||||||||||||||||||||
Gross Margin
|
23.9
|
%
|
32.4
|
%
|
-850bps
|
23.8
|
%
|
34.9
|
%
|
-1,110bps
|
||||||||||||||
SG&A Margin
|
43.6
|
%
|
33.7
|
%
|
990bps
|
43.6
|
%
|
33.7
|
%
|
990bps
|
||||||||||||||
Net (Loss) Income
|
$
|
(358
|
)
|
$
|
(51
|
)
|
$
|
(307
|
)
|
$
|
(225
|
)
|
$
|
5
|
$
|
(230
|
)
|
|||||||
Adjusted2 EBITDA
|
$
|
(224
|
)
|
$
|
86
|
$
|
(310
|
)
|
||||||||||||||||
Adjusted2 EBITDA Margin
|
(15.3
|
)%
|
4.4
|
%
|
-1,970bps
|
|||||||||||||||||||
EPS - Diluted
|
$
|
(4.49
|
)
|
$
|
(0.48
|
)
|
$
|
(4.01
|
)
|
$
|
(2.83
|
)
|
$
|
0.05
|
$
|
(2.88
|
)
|
• |
Net Sales of $1,463M declined (25)%, reflecting a Comparable1 Sales decline of (23)% and (2)% related to the impact from fleet optimization activity
|
▪ |
Bed Bath & Beyond banner Comparable1 Sales decline of (27)% reflecting rapid shift in consumer spending patterns and declining demand in Home sector
|
▪ |
buybuy BABY Comparable1 Sales of down mid-single digits commensurate with current market decline; Market share remains stable
|
• |
GAAP Gross Margin of 23.9%; Adjusted2 Gross Margin of 23.8%
|
▪ |
Adjusted2 Gross Margin reflects 840bps of negative transient costs vs. Q1 2021
|
▪ |
Transient costs reflect the impact of an inventory markdown reserve of (620bps) and supply chain-related port fees of (220bps)
|
▪ |
Excluding the aforementioned 840bps of transient costs, Q1 Adjusted2 Gross Margin of 32.2%
|
• |
Cash Flow from Operations of approximately $(0.4) billion, Cash Flow from Investing Activities of $(0.1) billion and Cash Flow from Financing Activities of $0.2 billion
|
• |
By channel, Comparable1 Sales declined (24)% in
Stores and (21)% in Digital versus the fiscal 2021 first quarter.
|
• |
Bed Bath & Beyond banner Comparable1 Sales
decreased (27)% compared to the prior year period. Results exclude the impact from the Company’s previously announced store fleet optimization program, which began in the second half of fiscal 2020.
|
• |
The buybuy BABY banner Comparable1 Sales decreased
in the mid-single digits compared to the Fiscal 2021 first quarter consistent with market trends.
|
– |
Sequential Comparable1 Sales recovery to occur in
the second half of Fiscal 2022 versus the first half of Fiscal 2022 driven by inventory optimization plans, including incremental clearance activity
|
– |
Adjusted2 SG&A expense for Fiscal 2022 below
last year, reflecting aggressive actions to align cost structure to sales
|
– |
Capital Expenditures of approximately $300 million (from $400 million previously) for Fiscal 2022, reflecting a minimum reduction of $100 million
|
(1)
|
Comparable Sales reflects the year-over-year change in sales from the Company’s retail channels, including stores and digital, that have been operating for twelve
full months following the opening period (typically six to eight weeks). Comparable Sales excludes the impact of the Company’s store network optimization program.
|
(2)
|
Adjusted items refer to comparable sales as well as financial measures that are derived from measures calculated in accordance with GAAP, which have been adjusted
to exclude certain items. Adjusted Gross Margin, Adjusted SG&A, Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted EPS - Diluted are non-GAAP financial measures. For more information about non-GAAP financial measures, see
“Non-GAAP Information” below.
|
(3)
|
Total Liquidity includes cash & investments and availability under the Company’s asset-based revolving credit facility.
|
Three Months Ended
|
||||||||
May 28, 2022
|
May 29, 2021
|
|||||||
Net sales
|
$
|
1,463,418
|
$
|
1,953,812
|
||||
Cost of sales
|
1,114,106
|
1,320,118
|
||||||
Gross profit
|
349,312
|
633,694
|
||||||
Selling, general and administrative expenses
|
637,508
|
658,762
|
||||||
Impairments
|
26,699
|
9,129
|
||||||
Restructuring and transformation initiative expenses
|
24,263
|
33,686
|
||||||
Loss on sale of businesses
|
—
|
3,989
|
||||||
Operating loss
|
(339,158
|
)
|
(71,872
|
)
|
||||
Interest expense, net
|
16,448
|
16,000
|
||||||
Loss on extinguishment of debt
|
—
|
265
|
||||||
Loss before provision (benefit) for income taxes
|
(355,606
|
)
|
(88,137
|
)
|
||||
Provision (benefit) for income taxes
|
2,060
|
(37,263
|
)
|
|||||
Net loss
|
$
|
(357,666
|
)
|
$
|
(50,874
|
)
|
||
Net loss per share - Basic
|
$
|
(4.49
|
)
|
$
|
(0.48
|
)
|
||
Net loss per share - Diluted
|
$
|
(4.49
|
)
|
$
|
(0.48
|
)
|
||
Weighted average shares outstanding - Basic
|
79,611
|
106,772
|
||||||
Weighted average shares outstanding - Diluted
|
79,611
|
106,772
|
Three Months Ended May 28, 2022
|
||||||||||||||||||||||||||||||||
Excluding
|
||||||||||||||||||||||||||||||||
Reported
|
Loss on Sale
of Businesses
|
Loss on extinguishment
of debt |
Restructuring
and
Transformation
Expenses
|
Impairments
charges
|
Total income
tax impact
|
Total Impact
|
Adjusted
|
|||||||||||||||||||||||||
Gross Profit
|
$
|
349,312
|
$
|
—
|
$
|
—
|
$
|
(1,167
|
)
|
$
|
—
|
$
|
—
|
$
|
(1,167
|
)
|
$
|
348,145
|
||||||||||||||
Gross margin
|
23.9
|
%
|
—
|
%
|
—
|
%
|
(0.1
|
)%
|
—
|
%
|
—
|
%
|
(0.1
|
)%
|
23.8
|
%
|
||||||||||||||||
Restructuring and transformation initiative expenses
|
24,263
|
—
|
—
|
(24,263
|
)
|
—
|
—
|
(24,263
|
)
|
—
|
||||||||||||||||||||||
(Loss) earnings before provision (benefit) for income taxes
|
(355,606
|
)
|
—
|
—
|
23,096
|
26,699
|
—
|
49,795
|
(305,811
|
)
|
||||||||||||||||||||||
Provision (benefit) for income taxes
|
2,060
|
—
|
—
|
—
|
—
|
(82,636
|
)
|
(82,636
|
)
|
(80,576
|
)
|
|||||||||||||||||||||
Effective tax rate
|
(0.6
|
)%
|
26.9
|
%
|
26.9
|
%
|
26.3
|
%
|
||||||||||||||||||||||||
Net (loss) income
|
$
|
(357,666
|
)
|
$
|
—
|
$
|
—
|
$
|
23,096
|
$
|
26,699
|
$
|
82,636
|
$
|
132,431
|
$
|
(225,235
|
)
|
||||||||||||||
Net loss per share - Diluted
|
$
|
(4.49
|
)
|
$
|
1.66
|
$
|
(2.83
|
)
|
||||||||||||||||||||||||
Weighted average shares outstanding- Basic
|
79,611
|
79,611
|
79,611
|
|||||||||||||||||||||||||||||
Weighted average shares outstanding- Diluted
|
79,611
|
(1)
|
79,611
|
79,611
|
||||||||||||||||||||||||||||
Reconciliation of Net Income (loss) to EBITDA and Adjusted EBITDA
|
||||||||||||||||||||||||||||||||
Net (loss) income
|
$
|
(357,666
|
)
|
$
|
—
|
$
|
—
|
$
|
23,096
|
$
|
26,699
|
$
|
82,636
|
$
|
132,431
|
$
|
(225,235
|
)
|
||||||||||||||
Depreciation and amortization
|
71,103
|
—
|
—
|
(5,275
|
)
|
—
|
—
|
(5,275
|
)
|
65,828
|
||||||||||||||||||||||
Interest expense
|
16,448
|
—
|
—
|
—
|
—
|
—
|
—
|
16,448
|
||||||||||||||||||||||||
Provision (benefit) for income taxes
|
2,060
|
—
|
—
|
—
|
—
|
(82,636
|
)
|
(82,636
|
)
|
(80,576
|
)
|
|||||||||||||||||||||
EBITDA
|
$
|
(268,055
|
)
|
$
|
—
|
$
|
—
|
$
|
17,821
|
$
|
26,699
|
$
|
—
|
$
|
44,520
|
$
|
(223,535
|
)
|
||||||||||||||
EBITDA as % of net sales
|
(15.3
|
)%
|
Three Months Ended May 29, 2021
|
||||||||||||||||||||||||||||||||
Excluding
|
||||||||||||||||||||||||||||||||
Reported
|
Loss on Sale
of Businesses
|
Loss on
extinguishment
of debt
|
Restructuring
and
Transformation
Expenses |
Impairment
charges
|
Total income
tax impact
|
Total Impact
|
Adjusted
|
|||||||||||||||||||||||||
Gross Profit
|
$
|
633,694
|
$
|
—
|
$
|
—
|
$
|
47,344
|
$
|
—
|
$
|
—
|
$
|
47,344
|
$
|
681,038
|
||||||||||||||||
Gross margin
|
32.4
|
%
|
—
|
%
|
—
|
%
|
2.4
|
%
|
—
|
%
|
—
|
%
|
2.4
|
%
|
34.9
|
%
|
||||||||||||||||
Restructuring and transformation initiative expenses
|
33,686
|
—
|
—
|
(33,686
|
)
|
—
|
—
|
(33,686
|
)
|
—
|
||||||||||||||||||||||
(Loss) earnings before (benefit) provision for income taxes
|
(88,137
|
)
|
3,989
|
265
|
81,030
|
9,129
|
—
|
94,413
|
6,276
|
|||||||||||||||||||||||
(Benefit) provision for income taxes
|
(37,263
|
)
|
—
|
—
|
—
|
—
|
38,614
|
38,614
|
1,351
|
|||||||||||||||||||||||
Effective tax rate
|
42.3
|
%
|
(20.8
|
)%
|
(20.8
|
)%
|
21.5
|
%
|
||||||||||||||||||||||||
Net (loss) income
|
$
|
(50,874
|
)
|
$
|
3,989
|
$
|
265
|
$
|
81,030
|
$
|
9,129
|
$
|
(38,614
|
)
|
$
|
55,799
|
$
|
4,925
|
||||||||||||||
Net (loss) earnings per share - Diluted
|
$
|
(0.48
|
)
|
$
|
0.53
|
$
|
0.05
|
|||||||||||||||||||||||||
Weighted average shares outstanding- Basic
|
106,772
|
106,772
|
106,772
|
|||||||||||||||||||||||||||||
Weighted average shares outstanding- Diluted
|
106,772
|
(1)
|
106,772
|
109,029
|
||||||||||||||||||||||||||||
Reconciliation of Net (Loss) Income to EBITDA and Adjusted EBITDA
|
||||||||||||||||||||||||||||||||
Net (loss) income
|
$
|
(50,874
|
)
|
$
|
3,989
|
$
|
265
|
$
|
81,030
|
$
|
9,129
|
$
|
(38,614
|
)
|
$
|
55,799
|
$
|
4,925
|
||||||||||||||
Depreciation and amortization
|
68,278
|
—
|
—
|
(4,484
|
)
|
—
|
—
|
(4,484
|
)
|
63,794
|
||||||||||||||||||||||
Loss on extinguishment of debt
|
265
|
—
|
(265
|
)
|
—
|
—
|
—
|
(265
|
)
|
—
|
||||||||||||||||||||||
Interest expense
|
16,000
|
—
|
—
|
—
|
—
|
—
|
—
|
16,000
|
||||||||||||||||||||||||
(Benefit) provision for income taxes
|
(37,263
|
)
|
—
|
—
|
—
|
—
|
38,614
|
38,614
|
1,351
|
|||||||||||||||||||||||
EBITDA
|
$
|
(3,594
|
)
|
$
|
3,989
|
$
|
—
|
$
|
76,546
|
$
|
9,129
|
$
|
—
|
$
|
89,664
|
$
|
86,070
|
|||||||||||||||
EBITDA as % of net sales
|
4.4
|
%
|
May 28, 2022
|
February 26, 2022
|
May 29, 2021
|
||||||||||
(unaudited)
|
(unaudited)
|
|||||||||||
Assets
|
||||||||||||
Current assets:
|
||||||||||||
Cash and cash equivalents
|
$
|
107,543
|
$
|
439,496
|
$
|
1,097,267
|
||||||
Short term investment securities
|
—
|
—
|
29,997
|
|||||||||
Merchandise inventories
|
1,759,586
|
1,725,410
|
1,563,602
|
|||||||||
Prepaid expenses and other current assets
|
190,179
|
198,248
|
515,993
|
|||||||||
Total current assets
|
2,057,308
|
2,363,154
|
3,206,859
|
|||||||||
Long term investment securities
|
18,983
|
19,212
|
19,458
|
|||||||||
Property and equipment, net
|
1,119,247
|
1,027,387
|
929,335
|
|||||||||
Operating lease assets
|
1,597,461
|
1,562,857
|
1,584,144
|
|||||||||
Other assets
|
156,103
|
157,962
|
313,493
|
|||||||||
Total Assets
|
$
|
4,949,102
|
$
|
5,130,572
|
$
|
6,053,289
|
||||||
Liabilities and Shareholders’ (Deficit) Equity
|
||||||||||||
Current liabilities:
|
||||||||||||
Accounts payable
|
$
|
816,578
|
$
|
872,445
|
$
|
889,883
|
||||||
Accrued expenses and other current liabilities
|
549,754
|
529,371
|
506,674
|
|||||||||
Merchandise credit and gift card liabilities
|
325,232
|
326,465
|
309,576
|
|||||||||
Current operating lease liabilities
|
334,891
|
346,506
|
347,365
|
|||||||||
Total current liabilities
|
2,026,455
|
2,074,787
|
2,053,498
|
|||||||||
Other liabilities
|
111,085
|
102,438
|
78,353
|
|||||||||
Operating lease liabilities
|
1,561,870
|
1,508,002
|
1,529,173
|
|||||||||
Income taxes payable
|
90,120
|
91,424
|
102,905
|
|||||||||
Long term debt
|
1,379,870
|
1,179,776
|
1,182,566
|
|||||||||
Total liabilities
|
5,169,400
|
4,956,427
|
4,946,495
|
|||||||||
Shareholders’ (deficit) equity:
|
||||||||||||
Preferred stock - $0.01 par value; authorized - 1,000 shares; no shares issued or outstanding
|
—
|
—
|
—
|
|||||||||
Common stock - $0.01 par value; authorized - 900,000 shares; issued 344,621, 344,146 and 343,570, respectively; outstanding 79,958, 81,979 and
104,513 shares, respectively
|
3,446
|
3,441
|
3,435
|
|||||||||
Additional paid-in capital
|
2,243,378
|
2,235,894
|
2,208,052
|
|||||||||
Retained earnings
|
9,308,530
|
9,666,091
|
10,174,656
|
|||||||||
Treasury stock, at cost; 264,663, 262,167 and 239,057 shares, respectively
|
(11,728,295
|
)
|
(11,685,267
|
)
|
(11,234,529
|
)
|
||||||
Accumulated other comprehensive loss
|
(47,357
|
)
|
(46,014
|
)
|
(44,820
|
)
|
||||||
Total shareholders’ (deficit) equity
|
(220,298
|
)
|
174,145
|
1,106,794
|
||||||||
Total liabilities and shareholders’ (deficit) equity
|
$
|
4,949,102
|
$
|
5,130,572
|
$
|
6,053,289
|
Three Months Ended
|
||||||||
May 28, 2022
|
May 29, 2021
|
|||||||
Cash Flows from Operating Activities:
|
||||||||
Net loss
|
$
|
(357,666
|
)
|
$
|
(50,874
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation and amortization
|
71,103
|
68,278
|
||||||
Impairments
|
26,699
|
9,129
|
||||||
Stock-based compensation
|
7,123
|
7,918
|
||||||
Deferred income taxes
|
(2,299
|
)
|
(22,135
|
)
|
||||
Loss on sale of businesses
|
—
|
3,989
|
||||||
Loss on debt extinguishment
|
—
|
265
|
||||||
Other
|
590
|
(2,197
|
)
|
|||||
(Increase) decrease in assets:
|
||||||||
Merchandise inventories
|
(34,757
|
)
|
113,366
|
|||||
Other current assets
|
7,971
|
78,544
|
||||||
Other assets
|
(106
|
)
|
68
|
|||||
(Decrease) increase in liabilities:
|
||||||||
Accounts payable
|
(47,597
|
)
|
(102,201
|
)
|
||||
Accrued expenses and other current liabilities
|
(38,038
|
)
|
(129,327
|
)
|
||||
Merchandise credit and gift card liabilities
|
(1,176
|
)
|
(3,421
|
)
|
||||
Income taxes payable
|
(1,304
|
)
|
277
|
|||||
Operating lease assets and liabilities, net
|
(13,096
|
)
|
3,125
|
|||||
Other liabilities
|
(998
|
)
|
(3,545
|
)
|
||||
Net cash used in operating activities
|
(383,551
|
)
|
(28,741
|
)
|
||||
Cash Flows from Investing Activities:
|
||||||||
Purchases of held-to-maturity investment securities
|
—
|
(29,997
|
)
|
|||||
Capital expenditures
|
(104,852
|
)
|
(73,521
|
)
|
||||
Net cash used in investing activities
|
(104,852
|
)
|
(103,518
|
)
|
||||
Cash Flows from Financing Activities:
|
||||||||
Borrowing of long-term debt
|
200,000
|
—
|
||||||
Repayments of long-term debt
|
—
|
(8,173
|
)
|
|||||
Repurchase of common stock, including fees
|
(43,028
|
)
|
(138,695
|
)
|
||||
Payment of dividends
|
(271
|
)
|
(560
|
)
|
||||
Net cash provided by (used in) financing activities
|
156,701
|
(147,428
|
)
|
|||||
|
||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(251
|
)
|
6,117
|
|||||
Net decrease in cash, cash equivalents and restricted cash
|
(331,953
|
)
|
(273,570
|
)
|
||||
Cash, cash equivalents and restricted cash:
|
||||||||
Beginning of period
|
470,884
|
1,407,224
|
||||||
End of period
|
$
|
138,931
|
$
|
1,133,654
|
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