The retailer’s operations burned through about $300 million in cash in the quarter ended Nov. 26 and closed the period with about $200 million in cash and equivalents.
It had secured $500 million in financing in August. The company said Tuesday it had about $500 million in total liquidity, including what it can still borrow against its credit lines.
The company said last week that it was running low on funds and considering several options, including seeking relief in bankruptcy court. The retailer is in the early stages of planning for a chapter 11 bankruptcy filing, which could come within weeks, according to people familiar with the situation.
Net sales for the recent quarter fell 33% to $1.26 billion, compared with $1.88 billion a year earlier. The results were dragged down by Bed Bath & Beyond stores, where sales excluding newly opened or closed stores fell 34%. Same-store sales at its Buybuy Baby division fell in the low 20s percentage range.
The net loss widened to $393 million from $276 million a year ago. The results were roughly in line with a business update the company provided last week.
“Although we moved quickly and effectively to change the assortment and other merchandising and marketing strategies, inventory was constrained and we did not achieve our goals,” said Chief Executive
Sue Gove.
Its shares have fallen 89% over the past year, closing Monday at $1.62. Shares gained nearly 2% in Tuesday premarket trading.
The company has been reeling from a failed makeover that replaced name-brands with private-label goods—a move that turned off shoppers. Former Chief Executive
Mark Tritton
resigned in June, followed by an exodus of senior leaders. Ms. Gove, a former retail executive and Bed Bath & Beyond director, was named permanent CEO in October, after running the company on an interim basis since Mr. Tritton’s departure.
On Tuesday Ms. Gove said the company is working to improve its inventory situation while also getting more national brands and refining its assortment of private-label products. It is in the process of closing about 150 underperforming stores, a plan that it announced in late August when it had more than 700 Bed Bath & Beyond locations.
Shopper visits to Bed Bath & Beyond stores were on the decline in 2022, according to Placer.ai, a firm that analyzes foot traffic to physical retail stores. In December, visits were down 26.5% compared with the same month in 2021, following a year-over-year drop of 23.1% in November.
Bed Bath & Beyond has fallen behind on payments to suppliers and is having trouble stocking its shelves. It hosted a supplier summit in September to try to convince vendors of its turnaround strategy. Many suppliers remain skeptical that the company can win back shoppers in the face of stiff competition and have been pressing for better payment terms or stopped shipments altogether, other people familiar with the situation said.
A chapter 11 filing isn’t certain to occur. The company is likely to secure the financing that would see it through the bankruptcy process from existing creditors, people familiar with the matter said.
Bed Bath & Beyond’s shares and bonds have been trading at distressed levels as the retailer has reported a string of losses and burned through its cash reserves. It has worked in recent months with financial adviser
Lazard
and law firm Kirkland & Ellis LLP on strategic options.
The company’s loan deal in August helped it navigate the critical holiday season, and it has been trying to reduce other debts and reassure vendors. It also pursued a series of debt exchanges that would have extended maturities and reduced interest expenses, but also required investors to take substantial haircuts on their principal.
It said last week that it failed to gain enough support from creditors for a proposed exchange of its unsecured senior notes.
Write to Suzanne Kapner at Suzanne.Kapner@dowjones.com
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
The retailer’s operations burned through about $300 million in cash in the quarter ended Nov. 26 and closed the period with about $200 million in cash and equivalents.
It had secured $500 million in financing in August. The company said Tuesday it had about $500 million in total liquidity, including what it can still borrow against its credit lines.
The company said last week that it was running low on funds and considering several options, including seeking relief in bankruptcy court. The retailer is in the early stages of planning for a chapter 11 bankruptcy filing, which could come within weeks, according to people familiar with the situation.
Net sales for the recent quarter fell 33% to $1.26 billion, compared with $1.88 billion a year earlier. The results were dragged down by Bed Bath & Beyond stores, where sales excluding newly opened or closed stores fell 34%. Same-store sales at its Buybuy Baby division fell in the low 20s percentage range.
The net loss widened to $393 million from $276 million a year ago. The results were roughly in line with a business update the company provided last week.
“Although we moved quickly and effectively to change the assortment and other merchandising and marketing strategies, inventory was constrained and we did not achieve our goals,” said Chief Executive
Sue Gove.
Its shares have fallen 89% over the past year, closing Monday at $1.62. Shares gained nearly 2% in Tuesday premarket trading.
The company has been reeling from a failed makeover that replaced name-brands with private-label goods—a move that turned off shoppers. Former Chief Executive
Mark Tritton
resigned in June, followed by an exodus of senior leaders. Ms. Gove, a former retail executive and Bed Bath & Beyond director, was named permanent CEO in October, after running the company on an interim basis since Mr. Tritton’s departure.
On Tuesday Ms. Gove said the company is working to improve its inventory situation while also getting more national brands and refining its assortment of private-label products. It is in the process of closing about 150 underperforming stores, a plan that it announced in late August when it had more than 700 Bed Bath & Beyond locations.
Shopper visits to Bed Bath & Beyond stores were on the decline in 2022, according to Placer.ai, a firm that analyzes foot traffic to physical retail stores. In December, visits were down 26.5% compared with the same month in 2021, following a year-over-year drop of 23.1% in November.
Bed Bath & Beyond has fallen behind on payments to suppliers and is having trouble stocking its shelves. It hosted a supplier summit in September to try to convince vendors of its turnaround strategy. Many suppliers remain skeptical that the company can win back shoppers in the face of stiff competition and have been pressing for better payment terms or stopped shipments altogether, other people familiar with the situation said.
A chapter 11 filing isn’t certain to occur. The company is likely to secure the financing that would see it through the bankruptcy process from existing creditors, people familiar with the matter said.
Bed Bath & Beyond’s shares and bonds have been trading at distressed levels as the retailer has reported a string of losses and burned through its cash reserves. It has worked in recent months with financial adviser
Lazard
and law firm Kirkland & Ellis LLP on strategic options.
The company’s loan deal in August helped it navigate the critical holiday season, and it has been trying to reduce other debts and reassure vendors. It also pursued a series of debt exchanges that would have extended maturities and reduced interest expenses, but also required investors to take substantial haircuts on their principal.
It said last week that it failed to gain enough support from creditors for a proposed exchange of its unsecured senior notes.
Write to Suzanne Kapner at Suzanne.Kapner@dowjones.com
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8