New York
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11-2250488
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(State of incorporation)
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(IRS Employer Identification No.)
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650 Liberty Avenue, Union, New Jersey 07083
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(Address of principal executive offices) (Zip Code)
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Yes x No o
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Yes x No o
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Large accelerated filer x
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Accelerated filer o
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Non-accelerated filer o (Do not check if a smaller reporting company)
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Smaller reporting company o
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Yes o No x
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Class
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Outstanding at June 1, 2013
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Common Stock - $0.01 par value
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217,765,600
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PART I - FINANCIAL INFORMATION
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PART II - OTHER INFORMATION
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Certifications
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June 1,
2013 |
March 2,
2013 |
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
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$ | 439,850 | $ | 564,971 | ||||
Short term investment securities
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481,804 | 449,933 | ||||||
Merchandise inventories
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2,540,723 | 2,466,214 | ||||||
Other current assets
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412,772 | 386,367 | ||||||
Total current assets
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3,875,149 | 3,867,485 | ||||||
Long term investment securities
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80,868 | 77,325 | ||||||
Property and equipment, net
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1,469,757 | 1,466,667 | ||||||
Goodwill
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486,279 | 483,518 | ||||||
Other assets
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400,595 | 384,957 | ||||||
Total assets
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$ | 6,312,648 | $ | 6,279,952 | ||||
Liabilities and Shareholders' Equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
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$ | 977,297 | $ | 913,365 | ||||
Accrued expenses and other current liabilities
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367,116 | 393,094 | ||||||
Merchandise credit and gift card liabilities
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262,945 | 251,481 | ||||||
Current income taxes payable
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126,750 | 77,270 | ||||||
Total current liabilities
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1,734,108 | 1,635,210 | ||||||
Deferred rent and other liabilities
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493,674 | 484,868 | ||||||
Income taxes payable
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79,815 | 80,144 | ||||||
Total liabilities
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2,307,597 | 2,200,222 | ||||||
Shareholders' equity:
|
||||||||
Preferred stock - $0.01 par value; authorized - 1,000 shares; no shares issued or outstanding
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- | - | ||||||
Common stock - $0.01 par value; authorized - 900,000 shares; issued 333,958 and 332,696 shares, respectively;
outstanding 217,766 and 221,489 shares, respectively
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3,340 | 3,327 | ||||||
Additional paid-in capital
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1,589,393 | 1,540,451 | ||||||
Retained earnings
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7,776,102 | 7,573,612 | ||||||
Treasury stock, at cost; 116,192 and 111,207 shares, respectively
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(5,357,776 | ) | (5,033,340 | ) | ||||
Accumulated other comprehensive loss
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(6,008 | ) | (4,320 | ) | ||||
Total shareholders' equity
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4,005,051 | 4,079,730 | ||||||
Total liabilities and shareholders' equity
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$ | 6,312,648 | $ | 6,279,952 |
Three Months Ended
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||||||||
June 1,
2013 |
May 26,
2012 |
|||||||
Net sales
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$ | 2,612,140 | $ | 2,218,292 | ||||
Cost of sales
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1,579,169 | 1,331,093 | ||||||
Gross profit
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1,032,971 | 887,199 | ||||||
Selling, general and administrative expenses
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709,870 | 573,801 | ||||||
Operating profit
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323,101 | 313,398 | ||||||
Interest expense, net
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(225 | ) | (1,056 | ) | ||||
Earnings before provision for income taxes
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322,876 | 312,342 | ||||||
Provision for income taxes
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120,386 | 105,506 | ||||||
Net earnings
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$ | 202,490 | $ | 206,836 | ||||
Net earnings per share - Basic
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$ | 0.94 | $ | 0.90 | ||||
Net earnings per share - Diluted
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$ | 0.93 | $ | 0.89 | ||||
Weighted average shares outstanding - Basic
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215,451 | 229,086 | ||||||
Weighted average shares outstanding - Diluted
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218,335 | 232,683 |
Three Months Ended
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||||||||
June 1,
2013 |
May 26,
2012 |
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Net earnings
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$ | 202,490 | $ | 206,836 | ||||
Other comprehensive (loss) income:
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||||||||
Change in temporary impairment of auction rate securities, net of taxes
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(222 | ) | 398 | |||||
Pension adjustment, net of taxes
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167 | 23 | ||||||
Currency translation adjustment
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(1,633 | ) | (3,023 | ) | ||||
Other comprehensive loss
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(1,688 | ) | (2,602 | ) | ||||
Comprehensive income
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$ | 200,802 | $ | 204,234 |
Three Months Ended
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||||||||
June 1,
2013 |
May 26,
2012 |
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Cash Flows from Operating Activities:
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||||||||
Net earnings
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$ | 202,490 | $ | 206,836 | ||||
Adjustments to reconcile net earnings to net cash provided by operating activities:
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||||||||
Depreciation
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52,697 | 43,410 | ||||||
Stock-based compensation
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14,803 | 12,829 | ||||||
Tax benefit from stock-based compensation
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10,213 | 11,445 | ||||||
Deferred income taxes
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(17,229 | ) | (10,558 | ) | ||||
Other
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(302 | ) | (277 | ) | ||||
Increase in assets, net of effect of acquisitions:
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||||||||
Merchandise inventories
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(74,509 | ) | (130,956 | ) | ||||
Trading investment securities
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(3,911 | ) | (366 | ) | ||||
Other current assets
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(24,518 | ) | (8,268 | ) | ||||
Other assets
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(3,898 | ) | (2,190 | ) | ||||
Increase (decrease) in liabilities, net of effect of acquisitions:
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||||||||
Accounts payable
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73,497 | 119,886 | ||||||
Accrued expenses and other current liabilities
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(22,018 | ) | (12,346 | ) | ||||
Merchandise credit and gift card liabilities
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11,464 | 13,682 | ||||||
Income taxes payable
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49,151 | 27,390 | ||||||
Deferred rent and other liabilities
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4,566 | 1,845 | ||||||
Net cash provided by operating activities
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272,496 | 272,362 | ||||||
Cash Flows from Investing Activities:
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||||||||
Purchase of held-to-maturity investment securities
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(369,268 | ) | (281,130 | ) | ||||
Redemption of held-to-maturity investment securities
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337,500 | 421,875 | ||||||
Redemption of available-for-sale investment securities
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- | 6,475 | ||||||
Capital expenditures
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(64,966 | ) | (70,788 | ) | ||||
Net cash (used in) provided by investing activities
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(96,734 | ) | 76,432 | |||||
Cash Flows from Financing Activities:
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||||||||
Proceeds from exercise of stock options
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22,469 | 26,140 | ||||||
Excess tax benefit from stock-based compensation
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1,084 | 3,360 | ||||||
Repurchase of common stock, including fees
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(324,436 | ) | (306,276 | ) | ||||
Net cash used in financing activities
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(300,883 | ) | (276,776 | ) | ||||
Net (decrease) increase in cash and cash equivalents
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(125,121 | ) | 72,018 | |||||
Cash and cash equivalents:
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||||||||
Beginning of period
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564,971 | 1,003,166 | ||||||
End of period
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$ | 439,850 | $ | 1,075,184 |
As of June 1, 2013
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||||||||||||
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Quoted Prices
in Active
Markets for
Identical Assets
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Significant
Unobservable
Inputs
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|||||||||
(in millions)
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(Level 1)
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(Level 3)
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Total
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Long term - available-for-sale securities:
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Auction rate securities
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$ | - | $ | 48.6 | $ | 48.6 | ||||||
Long term - trading securities:
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||||||||||||
Nonqualified deferred compensation plan assets
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32.2 | - | 32.2 | |||||||||
Total
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$ | 32.2 | $ | 48.6 | $ | 80.8 |
As of March 2, 2013
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Quoted Prices
in Active
Markets for
Identical Assets
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Significant
Unobservable
Inputs
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|||||||||
(in millions)
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(Level 1)
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(Level 3)
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Total
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Long term - available-for-sale securities:
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Auction rate securities
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$ | - | $ | 49.0 | $ | 49.0 | ||||||
Long term - trading securities:
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||||||||||||
Nonqualified deferred compensation plan assets
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28.3 | - | 28.3 | |||||||||
Total
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$ | 28.3 | $ | 49.0 | $ | 77.3 |
(in millions)
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Auction Rate
Securities
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|||
Balance on March 2, 2013, net of temporary valuation adjustment
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$ | 49.0 | ||
Change in temporary valuation adjustment included in accumulated other comprehensive loss
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(0.4 | ) | ||
Redemptions at par
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- | |||
Balance on June 1, 2013, net of temporary valuation adjustment
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$ | 48.6 |
(in millions)
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June 1,
2013
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March 2,
2013
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Available-for-sale securities:
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Long term
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$ | 48.6 | $ | 49.0 | ||||
Trading securities:
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Long term
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32.2 | 28.3 | ||||||
Held-to-maturity securities:
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Short term
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481.8 | 449.9 | ||||||
Total investment securities
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$ | 562.6 | $ | 527.2 |
Three Months Ended
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||||||||
Black-Scholes Valuation Assumptions (1)
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June 1, 2013
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May 26, 2012
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Weighted Average Expected Life (in years) (2)
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6.6 | 6.5 | ||||||
Weighted Average Expected Volatility (3)
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29.27 | % | 31.06 | % | ||||
Weighted Average Risk Free Interest Rates (4)
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1.11 | % | 1.14 | % | ||||
Expected Dividend Yield
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- | - |
(Shares in thousands)
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Number of
Stock Options
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Weighted
Average
Exercise Price
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||||||
Options outstanding, beginning of period
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5,006 | $ | 42.32 | |||||
Granted
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563 | 69.78 | ||||||
Exercised
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(577 | ) | 38.92 | |||||
Forfeited or expired
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(2 | ) | 37.79 | |||||
Options outstanding, end of period
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4,990 | $ | 45.81 | |||||
Options exercisable, end of period
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3,195 | $ | 39.38 |
(Shares in thousands)
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Number of
Restricted
Shares
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Weighted
Average
Grant-Date
Fair Value
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||||||
Unvested restricted stock, beginning of period
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4,063 | $ | 45.98 | |||||
Granted
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706 | 69.54 | ||||||
Vested
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(836 | ) | 38.32 | |||||
Forfeited
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(22 | ) | 53.79 | |||||
Unvested restricted stock, end of period
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3,911 | $ | 51.83 |
(in millions)
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As of June 29, 2012
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Current assets
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$ | 222.0 | ||
Property and equipment and other non-current assets
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132.4 | |||
Intangible assets
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211.6 | |||
Goodwill
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247.4 | |||
Total assets acquired
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813.4 | |||
Accounts payable and other liabilities
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(252.9 | ) | ||
Borrowings under credit facility
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(25.5 | ) | ||
Total liabilities acquired
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(278.4 | ) | ||
Total net assets acquired
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$ | 535.0 |
·
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For the three months ended June 1, 2013, the Company’s net sales were $2.612 billion, an increase of approximately 17.8% as compared with the three months ended May 26, 2012.
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·
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Comparable store sales for the fiscal first quarter of 2013 increased by approximately 3.4% as compared with an increase of approximately 3.0% for the corresponding period last year.
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·
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Gross profit for the three months ended June 1, 2013 was $1.033 billion, or 39.5% of net sales, compared with $887.2 million, or 40.0% of net sales, for the three months ended May 26, 2012.
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·
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Selling, general and administrative expenses (“SG&A”) for the three months ended June 1, 2013 were $709.9 million, or 27.2% of net sales, compared with $573.8 million, or 25.9% of net sales, for the three months ended May 26, 2012.
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·
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The effective tax rate for the three months ended June 1, 2013 was 37.3% compared with 33.8% for the three months ended May 26, 2012. The tax rate included discrete items of an approximate $2.6 million net benefit and $14.6 million net benefit, respectively, for the three months ended June 1, 2013 and May 26, 2012.
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·
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For the three months ended June 1, 2013, net earnings per diluted share were $0.93 ($202.5 million), an increase of approximately 4.5%, as compared with net earnings per diluted share of $0.89 ($206.8 million) for the three months ended May 26, 2012. The increase in net earnings per diluted share for the three months ended June 1, 2013 is primarily the result of the impact of the Company’s repurchases of its common stock partially offset by the items described above.
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Financial Reporting Calendar
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Fiscal 2013 (fifty-two weeks)
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Fiscal 2012 (fifty-three weeks)
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First Quarter
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March 3, 2013 - June 1, 2013
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February 26, 2012 - May 26, 2012
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Second Quarter
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June 2, 2013 - August 31, 2013
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May 27, 2012 - August 25, 2012
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Third Quarter
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September 1, 2013 - November 30, 2013
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August 26, 2012 - November 24, 2012
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Fourth Quarter
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December 1, 2013 - March 1, 2014
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November 25, 2012 - March 2, 2013
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Comparable Store Sales Calendar
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||||
Fiscal 2013 (fifty-two weeks)
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Fiscal 2012 (fifty-two weeks)
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First Quarter
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March 3, 2013 - June 1, 2013
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March 4, 2012 - June 2, 2012
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Second Quarter
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June 2, 2013 - August 31, 2013
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June 3, 2012 - September 1, 2012
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Third Quarter
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September 1, 2013 - November 30, 2013
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September 2, 2012 - December 1, 2012
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Fourth Quarter
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December 1, 2013 - March 1, 2014
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December 2, 2012 - March 2, 2013
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(a)
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Disclosure Controls and Procedures
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(b)
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Changes in Internal Control over Financial Reporting
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Approximate Dollar
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||||||||||||||||
Total Number of
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Value of Shares
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|||||||||||||||
Shares Purchased as
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that May Yet Be
|
|||||||||||||||
Part of Publicly
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Purchased Under
|
|||||||||||||||
Total Number of
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Average Price
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Announced Plans
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the Plans or
|
|||||||||||||
Period
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Shares Purchased (1)
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Paid per Share (2)
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or Programs (1)
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Programs (1) (2)
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March 3, 2013 - March 30, 2013
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1,550,400 | $ | 60.05 | 1,550,400 | $ | 2,325,039,852 | ||||||||||
March 31, 2013 - April 27, 2013
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1,451,900 | $ | 65.18 | 1,451,900 | $ | 2,230,405,862 | ||||||||||
April 28, 2013 - June 1, 2013
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1,982,700 | $ | 68.93 | 1,982,700 | $ | 2,093,744,529 | ||||||||||
Total
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4,985,000 | $ | 65.07 | 4,985,000 | $ | 2,093,744,529 |
(1) Between December 2004 and December 2012, the Company's Board of Directors authorized, through share repurchase programs, the repurchase of $7.450 billion of its shares of common stock. The Company has authorization to make repurchases from time to time in the open market or through other parameters approved by the Board of Directors pursuant to existing rules and regulations. Shares purchased indicated in this table also include the withholding of a portion of restricted shares to cover taxes on vested restricted shares.
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(2) Excludes brokerage commissions paid by the Company.
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Date: July 10, 2013
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By: /s/ Eugene A. Castagna
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Eugene A. Castagna
|
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Chief Financial Officer and Treasurer
|
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(Principal Financial and Accounting Officer)
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Exhibit No.
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Exhibit
|
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10.1
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Letter agreement dated as of June 28, 2013 between the Company and Warren Eisenberg (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed with the Commission on July 2, 2013).
|
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10.2
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Letter agreement dated as of June 28, 2013 between the Company and Leonard Feinstein (incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K filed with the Commission on July 2, 2013).
|
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31.1
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Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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31.2
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Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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32
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Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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101.INS
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XBRL Instance Document
|
|
101.SCH
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XBRL Taxonomy Extension Schema Document
|
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
|
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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1.
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I have reviewed this quarterly report on Form 10-Q of Bed Bath & Beyond Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: July 10, 2013
|
/s/ Steven H. Temares
|
|
Steven H. Temares
|
||
Chief Executive Officer
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Bed Bath & Beyond Inc.;
|
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
Date: July 10, 2013
|
/s/ Eugene A. Castagna
|
|
Eugene A. Castagna
|
||
Chief Financial Officer and Treasurer
|
||
(Principal Financial and Accounting Officer)
|
Date: July 10, 2013
|
/s/ Steven H. Temares
|
|
Steven H. Temares
|
||
Chief Executive Officer
|
||
/s/ Eugene A. Castagna
|
||
Eugene A. Castagna
|
||
Chief Financial Officer and Treasurer
|
||
(Principal Financial and Accounting Officer)
|
Note 11 - Acquisitions
|
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 01, 2013
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination Disclosure [Text Block] |
11)
Acquisitions
On
June 1, 2012, the Company acquired Linen Holdings, LLC
(“Linen Holdings”), a distributor of a variety
of textile products, amenities and other goods to
institutional customers in the hospitality, cruise line,
food service, healthcare and other industries, for an
aggregate purchase price of approximately $108.1 million.
The purchase price includes approximately $24.0 million for
tradenames and approximately $40.2 million for goodwill.
Linen Holdings is included within the Institutional Sales
operating segment. In the first quarter of fiscal 2013, the
Company has finalized the valuation of assets acquired and
liabilities assumed.
Since
the date of acquisition, the results of Linen Holdings’
operations, which are not material, have been included in the
Company’s results of operations.
On
June 29, 2012, the Company acquired Cost Plus, Inc.
(“World Market”), a retailer selling a wide range
of home decorating items, furniture, gifts, holiday and other
seasonal items, and specialty food and beverages, for an
aggregate purchase price of approximately $560.5 million,
including the payment of assumed borrowings of $25.5 million
under a credit facility. The acquisition was consummated by a
wholly owned subsidiary of the Company through a tender offer
and merger, pursuant to which the Company acquired all of the
outstanding shares of common stock of World Market. World
Market is included within the North American Retail operating
segment.
In
the first quarter of fiscal 2013, the Company has finalized
the valuation of assets acquired and liabilities assumed. The
following table summarizes the estimated fair value of the
assets acquired and liabilities assumed at the date of
acquisition.
Included
within intangible assets above is approximately $196.5
million for tradenames, which is not subject to amortization.
The tradenames and goodwill are not expected to be deductible
for tax purposes.
Since
the date of acquisition, the results of World Market’s
operations, which are not material, have been included in the
Company’s results of operations and no proforma
disclosure of financial information has been
presented.
|
Consolidated Statements of Earnings (Unaudited) (USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended | |
---|---|---|
Jun. 01, 2013
|
May 26, 2012
|
|
Net sales | $ 2,612,140 | $ 2,218,292 |
Cost of sales | 1,579,169 | 1,331,093 |
Gross profit | 1,032,971 | 887,199 |
Selling, general and administrative expenses | 709,870 | 573,801 |
Operating profit | 323,101 | 313,398 |
Interest expense, net | (225) | (1,056) |
Earnings before provision for income taxes | 322,876 | 312,342 |
Provision for income taxes | 120,386 | 105,506 |
Net earnings | $ 202,490 | $ 206,836 |
Net earnings per share - Basic (in Dollars per share) | $ 0.94 | $ 0.90 |
Net earnings per share - Diluted (in Dollars per share) | $ 0.93 | $ 0.89 |
Weighted average shares outstanding - Basic (in Shares) | 215,451 | 229,086 |
Weighted average shares outstanding - Diluted (in Shares) | 218,335 | 232,683 |
Note 4 - Investment Securities
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 01, 2013
|
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Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] |
4)
Investment Securities
The
Company’s investment securities as of June 1, 2013 and
March 2, 2013 are as follows:
Auction
Rate Securities
As
of June 1, 2013 and March 2, 2013, the Company’s
available-for-sale investment securities represented
approximately $51.0 million par value of auction rate
securities, less temporary valuation adjustments of
approximately $2.4 million and $2.0 million, respectively.
Since these valuation adjustments are deemed to be temporary,
they are recorded in accumulated other comprehensive loss,
net of a related tax benefit, and did not affect the
Company’s net earnings. These securities at par are
invested in preferred shares of closed end municipal bond
funds, which are required, pursuant to the Investment Company
Act of 1940, to maintain minimum asset coverage ratios of
200%. All of these available-for-sale investments carried
triple-A credit ratings from one or more of the major credit
rating agencies as of June 1, 2013 and March 2, 2013, and
none of them are mortgage-backed debt obligations. As of June
1, 2013 and March 2, 2013, the Company’s
available-for-sale investments have been in a continuous
unrealized loss position for 12 months or more, however, the
Company believes that the unrealized losses are temporary and
reflect the investments’ current lack of liquidity. Due
to their lack of liquidity, the Company classified
approximately $48.6 million and $49.0 million of these
investments as long term investment securities at June 1,
2013 and March 2, 2013, respectively.
U.S.
Treasury Securities
As
of June 1, 2013 and March 2, 2013, the Company’s short
term held-to-maturity securities included approximately
$481.8 million and approximately $449.9 million,
respectively, of U.S. Treasury Bills with remaining
maturities of less than one year. These securities are stated
at their amortized cost which approximates fair value, which
is based on quoted prices in active markets for identical
instruments (i.e., Level 1 valuation).
Long
Term Trading Investment Securities
The
Company’s long term trading investment securities,
which are provided as investment options to the participants
of the nonqualified deferred compensation plan, are stated at
fair market value. The values of these trading investment
securities included in the table above are approximately
$32.2 million and $28.3 million as of June 1, 2013 and March
2, 2013, respectively.
|
Note 2 - Fair Value Measurements (Details) - Valuation of the Company’s Financial Assets Measured at Fair Value on a Recurring Basis by Input Level (USD $)
In Millions, unless otherwise specified |
Jun. 01, 2013
|
Mar. 02, 2013
|
---|---|---|
Long term - available-for-sale securities: | ||
Auction rate securities | $ 48.6 | $ 49.0 |
Long term - trading securities: | ||
Nonqualified deferred compensation plan assets | 32.2 | 28.3 |
Auction Rate Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
|
||
Long term - available-for-sale securities: | ||
Auction rate securities | 48.6 | 49.0 |
Auction Rate Securities [Member] | Fair Value, Measurements, Recurring [Member]
|
||
Long term - available-for-sale securities: | ||
Auction rate securities | 48.6 | 49.0 |
Auction Rate Securities [Member]
|
||
Long term - available-for-sale securities: | ||
Auction rate securities | 48.6 | 49.0 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
|
||
Long term - trading securities: | ||
Nonqualified deferred compensation plan assets | 32.2 | 28.3 |
Total | 32.2 | 28.3 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
|
||
Long term - trading securities: | ||
Total | 48.6 | 49.0 |
Fair Value, Measurements, Recurring [Member]
|
||
Long term - trading securities: | ||
Nonqualified deferred compensation plan assets | 32.2 | 28.3 |
Total | $ 80.8 | $ 77.3 |
Note 2 - Fair Value Measurements (Tables)
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 01, 2013
|
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets Measured on Recurring Basis [Table Text Block] |
|
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Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] |
|
Note 11 - Acquisitions (Details) (USD $)
|
3 Months Ended | 4 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 01, 2013
|
Mar. 02, 2013
|
Jun. 01, 2012
Trade Names [Member]
Linen Holdings, LLC [Member]
|
Jun. 29, 2012
Trade Names [Member]
Cost Plus [Member]
|
Jun. 01, 2012
Linen Holdings, LLC [Member]
|
Jun. 29, 2012
Cost Plus [Member]
|
|
Note 11 - Acquisitions (Details) [Line Items] | ||||||
Business Combination, Consideration Transferred | $ 108,100,000 | $ 560,500,000 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets | 24,000,000 | 196,500,000 | ||||
Goodwill | 486,279,000 | 483,518,000 | 40,200,000 | 247,400,000 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities | $ 25,500,000 |
Note 3 - Cash and Cash Equivalents (Details) (USD $)
In Millions, unless otherwise specified |
Jun. 01, 2013
|
Mar. 02, 2013
|
---|---|---|
Cash and Cash Equivalents Disclosure [Abstract] | ||
Number Of Business Days For Settlement Of Credit And Debit Card Receivables | 5 days | |
Credit and Debit Card Receivables, at Carrying Value | $ 88.1 | $ 87.8 |
Note 7 - Shareholders' Equity (Details) (USD $)
|
3 Months Ended | ||
---|---|---|---|
Jun. 01, 2013
|
May 26, 2012
|
Mar. 02, 2013
|
|
Stockholders' Equity Note Disclosure [Abstract] | |||
Stock Repurchase Program, Authorized Amount | $ 7,450,000,000 | ||
Treasury Stock, Shares, Acquired (in Shares) | 5,000,000 | ||
Payments for Repurchase of Common Stock | 324,436,000 | 306,276,000 | |
Treasury Stock, Shares (in Shares) | 116,192,000 | 111,207,000 | |
Treasury Stock, Value | 5,357,776,000 | 5,033,340,000 | |
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 2,100,000,000 |
Note 6 - Stock-Based Compensation (Details) - Assumptions Used to Estimate the Black-Scholes Fair Value of Stock Options Granted
|
3 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 01, 2013
|
May 26, 2012
|
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Assumptions Used to Estimate the Black-Scholes Fair Value of Stock Options Granted [Abstract] | ||||||||||||
Weighted Average Expected Life (in years) (2) | 6 years 219 days | [1],[2] | 6 years 6 months | [1],[2] | ||||||||
Weighted Average Expected Volatility (3) | 29.27% | [1],[3] | 31.06% | [1],[3] | ||||||||
Weighted Average Risk Free Interest Rates (4) | 1.11% | [1],[4] | 1.14% | [1],[4] | ||||||||
Expected Dividend Yield | 0.00% | [1] | [1] | |||||||||
|
Note 2 - Fair Value Measurements (Details) - Changes in the Company’s Financial Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Auction Rate Securities [Member], USD $)
In Millions, unless otherwise specified |
3 Months Ended |
---|---|
Jun. 01, 2013
|
|
Auction Rate Securities [Member]
|
|
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance on March 2, 2013, net of temporary valuation adjustment | $ 49.0 |
Change in temporary valuation adjustment included in accumulated other comprehensive loss | (0.4) |
Balance on June 1, 2013, net of temporary valuation adjustment | $ 48.6 |
Note 2 - Fair Value Measurements
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Jun. 01, 2013
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Text Block] |
2)
Fair Value Measurements
Fair
value is defined as the price that would be received to sell
an asset or paid to transfer a liability (i.e., “the
exit price”) in an orderly transaction between market
participants at the measurement date. In determining fair
value, the Company uses various valuation approaches,
including quoted market prices and discounted cash flows. The
hierarchy for inputs used in measuring fair value maximizes
the use of observable inputs and minimizes the use of
unobservable inputs by requiring that the most observable
inputs be used when available. Observable inputs are inputs
that market participants would use in pricing the asset or
liability developed based on market data obtained from
independent sources. Unobservable inputs are inputs that
reflect a company’s judgment concerning the assumptions
that market participants would use in pricing the asset or
liability developed based on the best information available
under the circumstances. The fair value hierarchy is broken
down into three levels based on the reliability of inputs as
follows:
•
Level 1 – Valuations based on quoted prices in active
markets for identical instruments that the Company is able to
access. Since valuations are based on quoted prices that are
readily and regularly available in an active market,
valuation of these products does not entail a significant
degree of judgment.
•
Level 2 – Valuations based on quoted prices in active
markets for instruments that are similar, or quoted prices in
markets that are not active for identical or similar
instruments, and model-derived valuations in which all
significant inputs and significant value drivers are
observable in active markets.
•
Level 3 – Valuations based on inputs that are
unobservable and significant to the overall fair value
measurement.
As
of June 1, 2013, the Company’s financial assets
utilizing Level 1 inputs include long term investment
securities traded on active securities exchanges. The Company
did not have any financial assets utilizing Level 2 inputs.
Financial assets utilizing Level 3 inputs included long term
investments in auction rate securities consisting of
preferred shares of closed end municipal bond funds (See
“Investment Securities,” Note 4).
To
the extent that valuation is based on models or inputs that
are less observable or unobservable in the market, the
determination of fair value requires more judgment.
Accordingly, the Company’s degree of judgment exercised
in determining fair value is greatest for instruments
categorized in Level 3. In certain cases, the inputs used to
measure fair value may fall into different levels of the fair
value hierarchy. In such cases, an asset or liability must be
classified in its entirety based on the lowest level of input
that is significant to the measurement of fair
value.
Valuation
techniques used by the Company must be consistent with at
least one of the three possible approaches: the market
approach, income approach and/or cost approach. The
Company’s Level 1 valuations are based on the market
approach and consist primarily of quoted prices for identical
items on active securities exchanges. The Company’s
Level 3 valuations of auction rate securities, which had
temporary valuation adjustments of approximately $2.4 million
and $2.0 million as of June 1, 2013 and March 2, 2013,
respectively, are based on the income approach, specifically,
discounted cash flow analyses which utilize significant
inputs based on the Company’s estimates and
assumptions. As of June 1, 2013, the inputs used in the
Company’s discounted cash flow analysis included
current coupon rates ranging from 0.20% to 0.25%, an
estimated redemption period of 5 years and a discount rate of
1.21%. The discount rate was based on market rates for
risk-free tax-exempt securities, as adjusted for a risk
premium to reflect the lack of liquidity of these
investments. Assuming a higher discount rate, a longer
estimated redemption period and lower coupon rates would
result in a lower fair market value. Conversely, assuming a
lower discount rate, a shorter estimated redemption period
and higher coupon rates would result in a higher fair market
value.
The
following tables present the valuation of the Company’s
financial assets as of June 1, 2013 and March 2, 2013,
measured at fair value on a recurring basis by input
level:
The
following table presents the changes in the Company's
financial assets that are measured at fair value on a
recurring basis using significant unobservable inputs (Level
3):
Fair
Value of Financial Instruments
The
Company’s financial instruments include cash and cash
equivalents, investment securities, accounts payable and
certain other liabilities. The Company’s investment
securities consist primarily of U.S. Treasury securities,
which are stated at amortized cost, and auction rate
securities, which are stated at their approximate fair value.
The book value of all financial instruments is representative
of their fair values.
|
Note 5 - Property and Equipment
|
3 Months Ended |
---|---|
Jun. 01, 2013
|
|
Property, Plant and Equipment Disclosure [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] |
5)
Property and Equipment
As
of June 1, 2013 and March 2, 2013, included in property and
equipment, net is accumulated depreciation and amortization
of approximately $1.9 billion and $1.8 billion,
respectively.
|
Note 3 - Cash and Cash Equivalents
|
3 Months Ended |
---|---|
Jun. 01, 2013
|
|
Cash and Cash Equivalents Disclosure [Abstract] | |
Cash and Cash Equivalents Disclosure [Text Block] |
3)
Cash and Cash Equivalents
Included
in cash and cash equivalents are credit and debit card
receivables from banks, which typically settle within five
business days, of $88.1 million and $87.8 million as of June
1, 2013 and March 2, 2013, respectively.
|
Note 4 - Investment Securities (Details) - Investment Securities (USD $)
In Millions, unless otherwise specified |
Jun. 01, 2013
|
Mar. 02, 2013
|
---|---|---|
Available-for-sale securities: | ||
Long term | $ 48.6 | $ 49.0 |
Trading securities: | ||
Long term | 32.2 | 28.3 |
Held-to-maturity securities: | ||
Short term | 481.8 | 449.9 |
Total investment securities | $ 562.6 | $ 527.2 |
Note 6 - Stock-Based Compensation (Details) - Changes in the Company’s Stock Options (Employee Stock Option [Member], USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended |
---|---|
Jun. 01, 2013
|
|
Employee Stock Option [Member]
|
|
Note 6 - Stock-Based Compensation (Details) - Changes in the Company’s Stock Options [Line Items] | |
Options outstanding, beginning of period | 5,006 |
Options outstanding, beginning of period (in Dollars per share) | $ 42.32 |
Granted | 563 |
Granted (in Dollars per share) | $ 69.78 |
Exercised | (577) |
Exercised (in Dollars per share) | $ 38.92 |
Forfeited or expired | (2) |
Forfeited or expired (in Dollars per share) | $ 37.79 |
Options outstanding, end of period | 4,990 |
Options outstanding, end of period (in Dollars per share) | $ 45.81 |
Options exercisable, end of period | 3,195 |
Options exercisable, end of period (in Dollars per share) | $ 39.38 |
Note 10 - Supplemental Cash Flow Information (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | |
---|---|---|
Jun. 01, 2013
|
May 26, 2012
|
|
Cash Flow, Supplemental Disclosures [Abstract] | ||
Income Taxes Paid | $ 76.7 | $ 72.8 |
Interest Paid | 2.4 | |
Capital Expenditures Incurred but Not yet Paid | $ 27.4 | $ 23.1 |