Expansion Tops BBB's List
Cecile Corral -- Home Textiles Today, October 1, 2007
Real estate expansion is top-of-mind for Bed Bath & Beyond, as the home textiles specialty chain revs up to open its first store outside the United States — to be located in Canada — before the end of this fiscal year, and it "continues to review other international opportunities," said Warren Eisenberg, co-chairman, during BBB's second-quarter earnings call last week.
Also still on plan is BBB's goal to ultimately operate 1,300 domestic BBB units, while exploring "multiple opportunities," Eisenberg said, to "expand, renovate or remodel a significant number of existing stores, thereby increasing their productivity."
The company currently operates: 839 BBB stores in 49 states, Washington D.C. and Puerto Rico; 36 Christmas Tree Shop units; 39 Harmon locations and eight buybuyBaby stores.
For all of fiscal 2007, BBB is on plan to open about 70 new stores well as two buybuyBaby units and four more Christmas Tree Shops.
"In future years," Eisenberg said, "we plan to accelerate the growth of our Christmas Tree Shops and buybuyBaby stores as well as continuing to roll out Harmon departments within our Bed Bath & Beyond stores."
In the works are two new facilities — a soon-to-come e-service fulfillment center to support BBB's growing online business, and a new, state-of-the-art 700,000-square-foot distribution center to be completed in 2008 to support the growing Christmas Tree Shops chain.
For the second quarter, BBB saw earnings rise 1.0% to $147.0 million from $145.5 million for the same period one year ago; per share earnings rose 7.8% to $0.55 from $0.51.
The company has helped improve its per-share earnings through a $1 billion share re-purchase program initiated in December 2006, and now the board has authorized an additional $1 billion buyback, with an open-ended schedule.
Sales in the quarter rose 10.0% to $1.77 billion from $1.61 billion. Comps grew by 2.2%.
Average gross margin tightened 80 basis points to a still-robust 41.4% of sales, while SG&A costs crept up 30 basis points to 28.9% of sales.
Bed Bath & Beyond Inc.
|Qtr. 9/1 ($millions)||2007||2006||% change|
|a.Net earnings in the 2007 second quarter included a $5.8 million benefit due to discrete tax items recorded in the quarter.
|Oper. Income (EBIT)||221.0||219.6||0.6|
|Per share (diluted)||0.55||0.51||7.8|
|Average gross margin||41.4%||42.2%||—|
|Six months||2007||2006||% change|
|Oper. Income (EBIT)||375.4||368.4||1.9|
|Per share (diluted)||0.93||0.88||5.7|
|Average gross margin||41.5%||42.2%||—|
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