Bed Bath & Beyond maintains sequential sales growth
U.S. home and bedding retail chain Bed Bath & Beyond reported strong sales growth in the first quarter, although its profits were lower than expected as the company invested heavily in a turnaround.
It was a busy quarter for Bed Bath & Beyond, the first year of its three-year transformation strategy, which includes a heavy focus on its own brands.
Bed Bath & Beyond launched three self-owned brands during the quarter and unveiled one of its largest marketing campaigns ever to position itself as a leading destination for homewares purchases.
Mark Tritton, president and CEO of Bed Bath & Beyond, said, "We are rebuilding our authority in the U.S. domestic market, recapturing market share and unlocking our full potential."
For the first quarter ended May 30, Bed Bath & Beyond narrowed its net loss to $51 million ($0.48 per share) from $302 million ($2.44 per share) in the same period last year.
Excluding one-time charges related to asset sales and other turnaround plans, the company reported earnings of 0.5 cents per share, below analysts' expectations of 0.8 cents per share.
Share price movement in the last year (Yahoo)
Bed Bath & Beyond's net sales rose 49% to $1.95 billion, beating estimates of $1.87 billion, thanks to growth in the company's core chain of stores.
Bed Bath & Beyond's chains now include Bed Bath & Beyond, Buybuy Baby, Harmon Face Values and Decorist; the total number of stores is 1,004, with Bed Bath & Beyond stores.
Sales at Bed Bath & Beyond stores were up 96 percent over last year. At that time, a large number of stores were forced to close due to the New Crown Pneumonia outbreak.
The brand's growth was driven by sales increases of more than 100 percent over the year-ago period in its key product categories - bedding, bath, dining, interior and home storage - with comparable sales up 7 percent year-over-year.
These categories accounted for approximately two-thirds of total Bed Bath & Beyond store sales in the first quarter.
Bed Bath & Beyond's comparable sales (including online and store sales) increased 86 percent over the prior-year period and 3 percent over two years. Digital sales were up 84 percent compared to 2019.
Mark Tritton said, "We've had a strong start to the year and are clearly on track to achieve our goals. 2021 is the first year of our three-year transformation plan following the foundation we laid in 2020, and a historic year for Bed Bath & Beyond in the face of the unprecedented challenge of the new pneumonia epidemic. It is a year of historic and necessary change for Bed Bath & Beyond against the backdrop of the unprecedented challenge of the New Crown Pneumonia epidemic. In the first quarter, we achieved our fourth consecutive quarter of comparable sales growth and gross margin growth that exceeded our expectations."
Subsequently, Bed Bath & Beyond raised its full-year revenue forecast to $8.4 billion from a previous estimate of $8 billion.
On an adjusted basis, fiscal 2021 earnings per share are expected to be in the range of $1.40 to $1.55. Wall Street analysts, on the other hand, see the company's full-year adjusted earnings of $1.47 per share on revenue of $8.15 billion.
Bed Bath & Beyond said it expects second-quarter adjusted earnings per share in the range of $0.48 to $0.55. Sales will be in the range of $2.04 billion to $2.08 billion.
To ensure that its three-year transformation plan can be successfully implemented, Bed Bath & Beyond invested $250 million in the first quarter to strengthen its digital capabilities to enhance supply chain competitiveness.
In addition, to grow its digital business, Bed Bath & Beyond appointed Jill Pavlovich as senior vice president of digital commerce in the first quarter.
And Jake Griffith has taken on a new role as vice president of product management.
where Jill Pavlovich was previously managing director and head of exclusive branding and sales at Wayfair.
Jake Griffith was previously general manager of Walmart's sports and fitness division and has held numerous positions at Amazon.
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