In the fiscal third quarter ended December 1, Bed Bath & Beyond experienced erosion in earnings and comparable store sales as it remains focused on internal initiatives to build store and omnichannel capabilities.
The company posted net earnings of $24.4 million, or 18 cents per diluted share, in the quarter versus $61.3 million, or 44 cents per diluted share, in the year-before quarter.
Comparable sales declined 1.8% versus the year-prior period. Bed Bath & Beyond’s customer-facing digital channels enjoyed comparable store gains, the company asserted, but store comps declined in the mid-single-digit percentage range. Net sales advanced 2.6% from the year-previous quarter to $3 billion while operating profit declined to $49.5 million from $108.4 million.
In a conference call, Janet Barth, Bed Bath & Beyond vp/investor relations, maintained that the company is ahead of plans in terms of long-term financial goals that include moderating declines in operating profit and net earnings per diluted share this year, and growing net earnings per diluted share by 2020.
In the conference call, Steven Temares, Bed Bath & Beyond CEO, said, “As we discussed during our last call in September, we have been managing our business with a stronger bias towards prioritizing profitability above sales growth to put us in a better position to reestablish earnings growth. Through a comprehensive review of our assortment, the early learnings coming from our initiatives as well as the investments we have been making in new technology tools and systems, we are able to make better decisions and pull different levers to drive more profitable results. We are using these insights to support various business decisions to ensure that they are aligned with our mission of being the expert for the home and heartfelt life events, and we can execute in a way that is profitable and scalable. While some of these decisions, such as eliminating less profitable SKUs from our assortment, making adjustments to our free shipping thresholds, modifying business rules for the Beyond [online]store and web transactions, and modifying our pricing algorithms may unfavorably impact our sales in the near-term, we believe these sound business decisions will lead to a stronger company and improved profitability over time.”