DOW JONES NEWSWIRES
Bed Bath & Beyond Inc.'s (BBBY) fiscal first-quarter profit climbed 14% on higher sales in the first full quarter since rival Linens 'n Things closed the last of its stores.
Shares jumped 5.7% to $30 in after-hours trading as the housewares retailer's earnings topped its guidance and Wall Street's expectations. The stock has gained about 75% since its nine-year low of $16.23 in November.
Linens 'n Things' 2008 bankruptcy filing had forced Bed, Bath & Beyond to offer discounts to draw shoppers. Still, some analysts have noted the company is benefiting from consumers "cocooning" - spending on home furnishings and electronics, rather than expensive vacations or other indulgences - during the recession.
For the quarter ended May 30, Bed, Bath & Beyond reported profit of $87.2 million, or 34 cents a share, up from $76.8 million, or 30 cents a share, a year earlier.
Revenue rose 2.8% to $1.69 billion.
In April, the company said it was comfortable with earnings projections of 23 cents to 24 cents a share on a 1% to 3% revenue increase. Analysts' latest estimates were for per-share earnings of 25 cents on revenue of $1.68 billion, up 2%, according to a poll by Thomson Reuters.
Same-store sales slid 1.6%, beating analysts' estimate of a decline of 3%. Same-store sales have fallen in five of the past six quarters after previously rising every quarter since the company went public in 1992.
Gross margin fell to 39.4% from 39.8%. Inventory slid 1.3% from a year earlier.
Bed, Bath & Beyond has more than 900 housewares and decor stores and operates about 100 other stores in its other chains: the Christmas Tree Shops, Harmon health and beauty stores and buybuy Baby.
- By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; Kathy.Shwiff@dowjones.com