In the first quarter, Bed Bath & Beyond recorded a big loss but also a significant jump in online sales. The retailer also noted that it plans to close 200 stores over the next two years as part of its ongoing restructuring.
The company posted a net loss of $302.3 million, or $2.44 per diluted share, in the quarter versus a net loss of $371.1 million, or $2.91 per diluted share, in the period a year before. Adjusted net loss was $242.8 million, or $1.96 per diluted share, versus adjusted net earnings of $15.5 million, or 12 cents per diluted share, in the year-previous period.
Net sales were $1.31 billion versus $2.57 billion in the fiscal year earlier. Operating loss was $460.9 million versus $406.8 million in the year-prior period.
Bed Bath & Beyond pointed out that its fiscal first quarter spanned the most critical months to date of the COVID-19 pandemic, March, April and May, and that the net sale decrease of 49% versus the year-past period was primarily the result of temporary store closures. At the same time, net sales from digital channels grew 82%, including sales growth in excess of 100% during April and May, while net sales from stores, 90% of which were closed during the majority of the quarter, tumbled 77%.
Mark Tritton, Bed Bath & Beyond president and CEO, said, “The impact of the COVID-19 situation was felt across our business during our fiscal first quarter, including loss of sales due to temporary store closures and margin pressure from the substantial channel shift to digital. From the beginning of this crisis, we have taken measured, purposeful steps to help keep our people safe and our customers serviced, and we are proud of the way our teams have navigated this unprecedented challenge with speed and agility. At the same time, our actions to strengthen our financial position and liquidity are enhancing our flexibility and capacity to invest and rebuild our business for long-term success.”
He added, “With nearly all stores now open, we are delighted to welcome back our customers and drive an enhanced omni-always shopping experience. We are encouraged by early customer response, including continued strong demand, in excess of 80%, across our digital channels during the month of June, bolstered by the expansion of our buy-online-pick-up-in-store and curbside pickup services. We believe Bed Bath & Beyond will emerge from this crisis even stronger, given the strength of our brand, our people and our balance sheet.”
The company did note, that as part of its ongoing restructuring program, it plans to right-size its real estate portfolio by closing approximately 200 mostly Bed Bath & Beyond stores over the next two years and focus on other SG&A expense reductions.