Build-A-Bear’s Q2 profit takes a hit; details new store openings
Build-A-Bear Workshop on Thursday posted a net loss in its second quarter but sales rose 5% as a promotion drew huge crowds to its stores.
The retailer, which has been upgrading its stores and diversifying its revenue stream and real estate portfolio, said it is continuing its strategy of expanding in high-traffic tourist areas.
Plans include a new stand-alone location at Navy Pier in Chicago, and a store at Fashion Show, in Las Vegas, later this year. It also expects to open an in-store shop inside FAO Schwarz’s store, in New York City’s Rockefeller Center, which is due to in November. Globally, it expects to expand its presence with the addition of a new franchisee in India.
Build-A-Bear reported a net loss of $1.8 million or 12 cents per share in the period ended Aug. 4, compared to net income of $44 thousand, or $0.00 per diluted share, in the year-ago period.
Consolidated revenues rose 5% to $83.2 million in the period, including a 14.4% bump in e-commerce. Revenue rose 8.7% in North America and fell 14.9% in Europe.
The retailer attributed the decrease in Europe to the impact caused by the ongoing uncertainty surrounding Brexit, as well as the May 2018 implementation of new privacy laws, which restricted its ability to directly market to shoppers.
Build-A-Bear’s second quarter included its one-day-only “Pay Your Age” promotion on June 12, which drew such massive crowds to its stores that that the retailer ended the event much earlier than anticipated. The company created the promotion to kick off its “Count Your Candles” program, which lets members of (14 years and under) of its loyalty program to pay their age for a “birthday treat bear” during the month of their birthday.
“To truly understand our second quarter results, it is important to realize that sales in the first nine weeks of the period were below expectations, negatively impacting profit, while the final four weeks, with the introduction of the ‘Pay Your Age’ events, including our ‘Count Your Candles’ birthday program, far surpassed our expectations,” said Sharon Price John, president and CEO. “The surge of interest from the events delivered a meaningful profit, although it was not enough to offset the start of the quarter.”
As of August 4, 2018, Build-A-Bear operated 365 corporately managed locations, including 307 in North America and 58 outside of North America. The company’s international franchisees ended the quarter with 96 stores in 10 countries.
The retailer, which has been upgrading its stores and diversifying its revenue stream and real estate portfolio, said it is continuing its strategy of expanding in high-traffic tourist areas.
Plans include a new stand-alone location at Navy Pier in Chicago, and a store at Fashion Show, in Las Vegas, later this year. It also expects to open an in-store shop inside FAO Schwarz’s store, in New York City’s Rockefeller Center, which is due to in November. Globally, it expects to expand its presence with the addition of a new franchisee in India.
Build-A-Bear reported a net loss of $1.8 million or 12 cents per share in the period ended Aug. 4, compared to net income of $44 thousand, or $0.00 per diluted share, in the year-ago period.
Consolidated revenues rose 5% to $83.2 million in the period, including a 14.4% bump in e-commerce. Revenue rose 8.7% in North America and fell 14.9% in Europe.
The retailer attributed the decrease in Europe to the impact caused by the ongoing uncertainty surrounding Brexit, as well as the May 2018 implementation of new privacy laws, which restricted its ability to directly market to shoppers.
Build-A-Bear’s second quarter included its one-day-only “Pay Your Age” promotion on June 12, which drew such massive crowds to its stores that that the retailer ended the event much earlier than anticipated. The company created the promotion to kick off its “Count Your Candles” program, which lets members of (14 years and under) of its loyalty program to pay their age for a “birthday treat bear” during the month of their birthday.
“To truly understand our second quarter results, it is important to realize that sales in the first nine weeks of the period were below expectations, negatively impacting profit, while the final four weeks, with the introduction of the ‘Pay Your Age’ events, including our ‘Count Your Candles’ birthday program, far surpassed our expectations,” said Sharon Price John, president and CEO. “The surge of interest from the events delivered a meaningful profit, although it was not enough to offset the start of the quarter.”
As of August 4, 2018, Build-A-Bear operated 365 corporately managed locations, including 307 in North America and 58 outside of North America. The company’s international franchisees ended the quarter with 96 stores in 10 countries.