Bed Bath & Beyond Eliminates Operating Chief Role, Cuts Staff -- 3rd Update

By Michael Dabaie

Bed Bath & Beyond Inc. (BBBY) said it is reducing corporate staff and has eliminated the role of chief operating officer.

The retailer said it initiated a reduction in corporate staff at its headquarters in Union, N.J., and some other locations. Eugene A. Castagna, president and chief operating officer, departed Tuesday and the chief operating officer role has been eliminated.

The company said it recently completed a review of its corporate office cost structure, which has resulted in a reduction of about 7% of its corporate staff. The company said this includes vice presidents, directors, managers and professional staff.

Bed Bath & Beyond said it will continue to review its cost structure to identify additional cost-savings opportunities.

These organizational changes are estimated to generate future annual pre-tax net savings of approximately $30.7 million, the company said.

The company said it estimated the pre-tax net savings for the remainder of fiscal 2019 to be about $18.9 million.

Bed Bath & Beyond said it expects to incur pre-tax cash restructuring charges of about $12.0 million in fiscal 2019, primarily for severance and related costs, all of which will be expensed in the second quarter.

"While decisions that impact our staff are difficult, today's action is an important step in simplifying our corporate structure and ensuring our resources are aligned with the business we are managing today," Interim Chief Executive Mary A. Winston "We remain confident in the underlying business and our ability to leverage the strength of the Bed Bath & Beyond brand and our lasting connection with customers to deliver on our near-term priorities and transform the Company."

Steven Temares stepped down as chief executive in May.

Shares were down 1.4%, to $9.23, in afternoon trading.

Moody's Investors Service said it was revising its outlook on Bed, Bath & Beyond to negative from stable, while affirming the company's Baa3 ratings.

Write to Michael Dabaie at michael.dabaie@wsj.com

(END) Dow Jones Newswires

July 23, 2019 15:58 ET (19:58 GMT)

Bed Bath and Beyond (NASDAQ:BBBY)
Historical Stock Chart
From Mar 2024 to Apr 2024