Build-A-Bear sales, earnings up over pre-pandemic levels
Build-A-Bear Workshop showed no signs of losing its momentum in the third quarter.
The retailer reported its third consecutive quarter of record-setting profit, leading to its strongest first nine-month performance on the precipice of the celebration of the company’s 25th anniversary.
Net income was $5.9 million, or $0.36 per diluted share, for the quarter ended Oct. 30, compared to $1.7 million, or $0.11 per diluted share, in the year-ago period and net loss of ($5.9) million, or ($0.40) per diluted share, in the fiscal 2019 third quarter.
Total revenues were $95.1 million, an increase of 27.4% from $74.7 million in the year-ago period, and a 35.2% increase from $70.4 million in the fiscal 2019 third quarter. Net retail sales were $91.6 million, a 26.5% increase compared to $72.4 million last year and a 37.5% increase compared to $66.6 million in the fiscal 2019 third quarter.
Consolidated e-commerce demand (orders generated online to be fulfilled from either the company’s warehouse or its stores) increased 5.7% compared to the year-ago period and represented nearly 20% of net retail sales. E-commerce demand increased 187.1% compared to the fiscal 2019 third quarter.
Build-A-Bear noted that its third-party retail model was showing a return to stability, with locations associated with relationships that include Carnival Cruise Lines, Great Wolf Lodge Resorts, Landry’s and Beaches Family Resorts were mostly reopened.
"We are pleased to report our third consecutive quarter of record-setting profit for Build-A-Bear Workshop along with strong growth in total revenues compared to both the fiscal 2020 and 2019 periods with the positive business momentum continuing into the start of the current fourth quarter,” said CEO Sharon Price John. “We firmly believe our results reflect the progress we have made in our key initiatives allowing us to capitalize on increased demand with enhanced marketing programs and omnichannel capabilities while also having acknowledged the potential positive impact from pandemic related factors such as pent-up consumer activity and government stimulus.”
The company increased its guidance regarding total revenues and EBITDA for fiscal 2021.
“We believe that our strategic actions have enabled us to fundamentally evolve our company to deliver continued profitability while recognizing that the external environment remains volatile due to ongoing pandemic concerns, higher costs and supply chain disruptions," said John.
Total revenues are now expected to be in the range of $390 to $400 million, up from its previous guidance in the range of $375 to $385 million. EBITDA in fiscal 2021 to be in the range of $55 million to $60 million, up from the previous expectation in the range of $45 million to $50 million.
Build-A-Bear’s board declared a special cash dividend of $1.25 per share and authorized a share repurchase program of up to $25 million effective through November 30, 2023. The dividend will be paid on December 27, 2021.
As of October 30, 2021, the company had 349 corporately managed stores.