For the first quarter of fiscal 2015 ended May 30, Bed, Bath & Beyond posted net earnings of $158.5 million, or 93 cents per diluted share, versus $187.1 million, or 93 cent per diluted share, in the year-earlier period. Comparable sales in the 2015 quarter advanced 2.2% year over year, the company stated.
Earnings per diluted share missed a Zacks Investment Research analyst average estimate by a penny.
Comparable sales for the first quarter of fiscal 2015 include an approximate 0.3 percentage points unfavorable impact from the year over year change in the Canadian currency exchange rate, the company noted.
Net sales were $2.74 billion, Bed, Bath & Beyond reported, up 3.1% from the 2014 first quarter. With higher selling, general and administrative expenses recorded, operating profit came in at $273.3 million versus $300.7 million in last year’s quarter.
In a conference call, Sue Lattmann, Bed, Bath & Beyond’s CFO and treasurer, pointed out that SG&A expenses increased to 28.1% of net sales as compared to 27.5% in last-year’s first quarter due to higher technology costs, including related depreciation, as well as an advertising expense increase partly attributable to growth in digital advertising.
In the conference call, Steven Temares, Bed, Bath & Beyond’s CEO, said that first quarter comps completed through the company’s websites and mobile applications increased more than 35% while those in stores were relatively flat.
Temares maintained that Bed, Bath & Beyond has continued to invest in its online capabilities including expanding product selection. He noted that the company has rolled out a brand-name mattresses line and launched several new collections of outdoor patio furniture and accessories on the company e-commerce website, following up with new bedding and home decor introductions. In addition, during May, Bed, Bath & Beyond launched an online-available product collection developed in conjunction with the country music band Lady Antebellum, one inspired by the band’s lifestyle, songs and stories, he said.
The company also is preparing a new customer contact center in Utah, Temares added.
In the quarter, Bed, Bath & Beyond opened two new namesake stores during the first quarter and closed one Cost Plus World Market store.