Bed Bath & Beyond Inc. (BBBY) has reported a 28.90 percent fall in profit for the quarter ended Nov. 26, 2016. The company has earned $126.42 million, or $0.85 a share in the quarter, compared with $177.82 million, or $1.09 a share for the same period last year.
Revenue during the quarter went up marginally by 0.12 percent to $2,955.48 million from $2,952.03 million in the previous year period. Gross margin for the quarter contracted 81 basis points over the previous year period to 36.97 percent. Total expenses were 92.85 percent of quarterly revenues, up from 90.08 percent for the same period last year. That has resulted in a contraction of 277 basis points in operating margin to 7.15 percent.
Operating income for the quarter was $211.28 million, compared with $292.86 million in the previous year period.
For financial year 2016, Bed Bath & Beyond Inc. projects diluted earnings per share to be in the range of $4.50 to $5.
Operating cash flow improves significantly
Bed Bath & Beyond Inc. has generated cash of $742.70 million from operating activities during the nine month period, up 51.59 percent or $252.76 million, when compared with the last year period.
The company has spent $393.99 million cash to meet investing activities during the nine month period as against cash outgo of $105.35 million in the last year period.
The company has spent $391.16 million cash to carry out financing activities during the nine month period as against cash outgo of $762.90 million in the last year period.
Cash and cash equivalents stood at $473.01 million as on Nov. 26, 2016, down 3.61 percent or $17.73 million from $490.74 million on Nov. 28, 2015.
Working capital declines
Bed Bath & Beyond Inc. has witnessed a decline in the working capital over the last year. It stood at $1,762.73 million as at Nov. 26, 2016, down 11.78 percent or $235.43 million from $1,998.16 million on Nov. 28, 2015. Current ratio was at 1.70 as on Nov. 26, 2016, down from 1.91 on Nov. 28, 2015.
Days inventory outstanding has decreased to 80 days for the quarter compared with 151 days for the previous year period. At the same time, days payable outstanding went up to 69 days for the quarter from 64 for the same period last year.
Debt remains almost stable
Total debt of Bed Bath & Beyond Inc. remained almost stable for the quarter at $1,491.49 million, when compared with the last year period. Long-term debt of Bed Bath & Beyond remained almost stable for the quarter at $1,491.49 million, when compared with the last year period. Total debt was 20.62 percent of total assets as on Nov. 26, 2016, compared with 21.79 percent on Nov. 28, 2015. Debt to equity ratio was at 0.57 as on Nov. 26, 2016, down from 0.58 as on Nov. 28, 2015. Interest coverage ratio deteriorated to 11.57 for the quarter from 16.22 for the same period last year.
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