Build-A-Bear comeback continues with its highest Q2 profit ever
Build-A-Bear Workshop’s maintained its momentum in the second quarter, leading to the company’s strongest first six months performance in its nearly 25-year history.
The retailer reported net income of $6.8 million, or $0.42 per share, for the quarter ended July 31. The gain compared to a loss of $13.9 million, or $0.93 per share, in the year-ago period.
“Our positive trend continued in the second quarter as we once again delivered record-breaking profit as well as strong growth in total revenues over both the fiscal 2020 and 2019 second quarters,” said CEO Sharon Price. “We believe these results reflect momentum that has been building from the execution of our stated strategy, agility to adapt to a rapidly evolving environment, and ability to accelerate key initiatives to drive sustained profitable growth, while recognizing that the business is also benefiting from pandemic-related factors such as pent-up demand and stimulus funds.”
Total revenues jumped 137.4% to $94.7 million, compared to $40.4 million in the year-ago quarter. Revenue was up 19.6% from the pre-pandemic second quarter of 2019.
Net retail sales increased 132.1% to $91.3 million compared to $39.3 million in the year-ago quarter. Sales rose 21.4% compared to the 2019.
Consolidated e-commerce demand declined 27.8% compared to the year-ago period and increased 158.9% compared to the second quarter of 2019. The retailer noted that in 2020, its e-commerce was the primary channel for revenue, with its digital demand buoyed by temporary store closures and the online exclusive launches of some powerful licensed properties.
For its first six months, Build-A-Bear’s total revenues were $186.4 million, an increase of 114.3% compared to $87.0 million in the year-ago period and an increase of 14.0% from $163.6 million in the first six months of 2019. Net income was $17.2 million, or $1.08 per share compared to net loss of $35.1 million, or $2.35 per share in the first six months of fiscal 2020 and net loss of less than ($0.1) million, or $0.00 per diluted share, in the first six months of fiscal 2019.
“Business trends have continued to be positive into the current third quarter,” Price said. “And while we are navigating an environment with higher costs and a tight supply chain as well as monitoring the ongoing evolution of the pandemic, we are optimistic about our full-year performance and are again increasing our annual guidance.”
The company now expects total revenues in fiscal 2021 to be in the range of $375 to $385 million which represents an increase from its previous guidance for fiscal 2021 total revenues to exceed fiscal 2019 total revenues of $338.5 million. Specifically related to its third quarter outlook, the company noted that business trends have remained strong, and it expects total revenues for the fiscal 2021 third quarter to exceed both 2020 and 2019 levels.
As of July 31, Build-A-Bear Workship had 352 corporately-managed stores. The company added that it maintains a high level of “lease optionality” with over 70% of its corporately-managed stores having a lease event within the next three years.