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Mattress Tub & Past (BBBY) Q2 2022 earnings

An individual enters a Mattress Tub & Past retailer on October 01, 2021 within the Tribeca neighborhood in New York Metropolis.

Michael M. Santiago | Getty Photographs

Bed Bath & Beyond on Thursday stated gross sales plunged by 28% within the fiscal second quarter, as the house items retailer struggled to attract prospects.

Shares bounced round in premarket buying and selling, as traders assessed the report. The corporate’s inventory has been unstable, fueled partially by the meme-stock frenzy in addition to drastic modifications to its enterprise.

The corporate reiterated its full-year outlook, saying it anticipates comparable gross sales to say no by about 20% as its enterprise improves within the again half of the fiscal yr.

Here is how the retailer did within the three-month interval ended Aug. 27 in contrast with what analysts have been anticipating, primarily based on Refinitiv knowledge:

  • Loss per share: $3.22 adjusted vs. $1.85 anticipated
  • Income: $1.44 billion vs. $1.47 billion anticipated

The corporate’s internet loss widened considerably to $366 million, or $4.59 per share, from $73 million, or 72 cents per share, a yr earlier. Its internet gross sales dropped from $1.99 billion the year-ago interval.

Comparable gross sales declined 26% within the second quarter. The important thing retail metric, typically referred to as same-store gross sales, is a year-over-year comparability of on-line gross sales and gross sales at shops which have operated for twelve full months following a gap interval of about six to eight weeks.

The quarterly report doesn’t replicate the company’s latest turnaround plan. In late August, it introduced plans to shake up its merchandising technique, and strengthen its namesake shops and child items chain, Buybuy Child. It additionally introduced cost-cutting measures, together with layoffs and shutting about 150 Mattress Tub & Past shops.

Learn extra: Here’s a map of Bed Bath & Beyond store closures

Interim CEO Sue Gove stated in a information launch Thursday the corporate is fixing stock issues by rushing up markdowns of some merchandise. She stated Mattress Tub is “assured that our present liquidity will allow the required modifications we’re implementing.”

Gove stated the corporate’s loyalty program, Welcome Rewards, has grown by greater than 1.3 million for the reason that finish of August, bringing it to a complete of 6.4 million members because it launched this summer time. She stated it’s reducing prices by about $250 million for the second half of the fiscal yr, as it really works to ramp up gross sales.

Mattress Tub faces a number of important challenges, together with mounting debt, vacant management roles and tense relationships with distributors. As the corporate gears up for the essential vacation season, it’s led by Gove, an interim CEO, and interim CFO Laura Crossen. Its board pushed out former CEO Mark Tritton in June, and CFO Gustavo Arnal died by suicide in early September.

In late August, Mattress Tub acquired some aid by securing more than $500 million of new financing, together with a $375 million mortgage.

Mattress Tub’s liquidity is $850 million after repayments and borrowing that befell earlier than the second quarter started, the corporate stated Thursday.

The approaching months will check whether or not the retailer can get scorching vacation gadgets and standard nationwide manufacturers, that are pivotal to its newest technique. In keeping with former firm executives, Bed Bath has had strained relationships with suppliers — and will face a repeat of two Christmases in the past, when it didn’t have a number of scorching merchandise from well-known nationwide manufacturers.

In a information launch, Gove stated working with Mattress Tub’s suppliers has “been an necessary focus space” and stated its debt and liabilities with them “are significantly more healthy than within the prior quarter.”

As of Wednesday’s market shut, Mattress Tub’s shares are down about 56% up to now this yr. The corporate’s market worth is $516.5 million.

Learn the corporate’s earnings launch here.

In case you are having suicidal ideas, contact the Suicide & Crisis Lifeline at 988 for assist and help from a educated counselor.

This story is creating. Please test again for updates.

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