Home goods retailer’s sales tumble in Q2

A combination of restructuring costs, Hurricane Harvey and a new accounting standard took its toll of Bed Bath & Beyond’s second quarter results.



For the quarter ended Aug. 26, the home goods retailer reported net sales of about $2.9 billion, a decrease of about 1.7% from the same time last year. Comparable sales also decreased by approximately 2.6%, surpassing analysts’ expectations of a 0.7% decrease.



Same-store sales from physical stores declined in the mid-single-digit percentage range during the quarter. However, comparable sales from customer-facing digital channels continued to have strong growth, in excess of 20% for the 13th consecutive quarter.



The company reported net earnings of $94.2 million, a decline from about $290 million for the same period in 2016. Bed Bath & Beyond blamed the slip on cash restructuring charges associated with the acceleration of the realignment of its store management structure, as well as costs associated with the impact of Hurricane Harvey, and a new share-based payment accounting standard.



The company is undertaking a number of transformational initiatives focused on driving operational excellence, as well as opportunities for added efficiencies. These projects “should produce savings in excess of $150 million over the next few years, a portion of which may be strategically reinvested toward future growth,” according to the retailer.



Looking ahead, the company is modeling net earnings per diluted share for the full year to be about $3, with the balance of the net earnings per diluted share to be split approximately 20% in the fiscal third quarter and approximately 80% in the fiscal fourth quarter, the company said.