Retailer's Results Fall Short Of Targets -- WSJ
June 23 2016 - 3:04AM
Dow Jones News
By Maria Armental
Bed Bath & Beyond Inc.'s quarterly profit and margin
declined as the home-goods retailer reported nearly flat sales in
the May quarter.
The results missed Wall Street targets, sending shares down 5%
to $40.86 in after-hours trading.
Still, the New Jersey-based company affirmed its profit
projection for the year, saying it expects results "to be
comfortably" within its previous range of $4.50 to about $5 a share
despite higher costs tied to its acquisition of online furnishing
store One Kings Lane.
Like other retailers, Bed Bath & Beyond's margins have been
hurt by sales promotions and a shift away from traditional
brick-and-mortar stores. In the most-recent period, ended May 28,
gross margin narrowed to 37.4% from 38.1% a year earlier.
The company's faltering results have added pressure and weakened
its stock, down 11% this year and 39% over the past 12 months. Last
year, shareholders voted down the company's executive compensation
package. The vote is nonbinding.
This year, the company is again facing pressure from
Institutional Shareholder Services and Glass Lewis & Co. along
with New York City Comptroller Scott M. Stringer, as administrator
of the city's pension funds, who have asked shareholders to reject
again the company's executive compensation plan, vote against
several board nominees and support a so-called proxy-access
initiative, allowing shareholders to nominate members to the
company's board.
The company's annual shareholder meeting is scheduled for July
1.
Over all, Bed Bath & Beyond reported first-quarter profit of
$122.6 million, or 80 cents a share, down from $158.5 million, or
93 cents a share, a year earlier. The company had 10% fewer shares
outstanding in the latest quarter.
Sales, meanwhile, edged down less than a tenth of a percent at
$2.74 billion.
Analysts surveyed by Thomson Reuters had projected 86 cents a
share of earnings on $2.78 billion in sales.
Sales at stores open for at least a year, a key metric for
retailers, declined about 0.5%, compared with a year-earlier
increase of 2.2% and analysts' projection for an increase of 0.6%,
according to FactSet.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
June 23, 2016 02:49 ET (06:49 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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