UNION, N.J.–Bed Bath & Beyond recorded an earnings decline in the recently completed third quarter and does not expect to meet Wall Street expectations for the fourth quarter due to projected flat sales.
The specialty home retailer recorded net earnings of $138.2 million, or 52 cents per diluted share, for the third quarter ended Dec. 1, compared with $142.4 million, or 50 cents per diluted share, for the year-ago period.
Bed Bath’s net sales for the quarter increased 10.8 percent to about $1.80 billion from roughly $1.62 billion for the same period last year. Same-store sales inched up 0.8 percent, compared with a 4.6 percent gain in last year’s third quarter.
“Our overall comp store sales increase was impacted by lower comp store sales in those areas of the country significantly affected by the housing market issues, notably Arizona, California, Florida and Nevada,” said Steven Temares, chief executive officer, during the company’s third-quarter earnings call. He partly attributed the bottom-line decline to “coupon redemptions associated with a heightened promotional environment, an increase in inventory acquisition costs, and the shift in the mix of merchandise sold as we experienced a higher percentage of sales of hard line goods.
Bed Bath for the fourth quarter ending March 1 expects earnings per diluted share of 64 cents to 67 cents, due in part to projected flat same-store sales for the quarter and a 2 percent to 4 percent decline in net sales. Analysts polled by Thomson Financial had expected earnings for the fourth quarter of 78 cents per share on average, according to media reports. The retailer for the full year expects earnings per share to be between $2.08 and $2.11 per share, compared with reported analyst expectations of about $2.20 per share.