Bed Bath & Beyond says it will share its comeback strategy next week

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Signage will be displayed outside a Bed Bath & Beyond Inc. store in Los Angeles, California, USA on Monday, September 19, 2016.

Patrick T Fallon | Bloomberg | Getty Images

Bed Bath & Beyond said Thursday it will soon share its turnaround strategy as it runs out of cash and tries to win back customers for the holiday season.

The homewares retailer will have an investor update Wednesday morning, it said in a press release. The stock rose more than 5% in after-hours trading on Thursday.

Interim CEO Sue Gove said in the release that the company’s call will “preview strategies and changes being implemented across the enterprise to deliver results for all stakeholders.”

She added: “We recognize the strong interest in our business and our plans to better serve customers, regain market share, drive growth and profitability, ensure our suppliers are supported and strengthen our balance sheet. “

Bed Bath & Beyond is on the clock to grow sales and convince investors it has a way forward. It is looking for a new CEO after the board dismissed Mark Tritton earlier this summer. It has lost market share to competitors as it has cut its 20% off coupons and introduced unknown private labels. And shares have plummeted, especially after activist investor Ryan Cohen sold his entire stake in the company last week.

In addition, the household goods sector is under pressure, ending a period of unusually strong demand during the peak of the pandemic. It is also a discretionary category that is more vulnerable as shoppers spend more on food and other necessities due to inflation. Those refrigerated sales have left many blenders, toaster ovens and coffee makers at great discount at both chain stores and specialty stores.

Bed Bath said in June its first quarter net sales were down 25% year-over-year, resulting in a net loss of $358 million. It did not provide a forecast, but said at the time it expected sales to recover in the second half of the fiscal year.

The economic backdrop is exacerbating Bed Bath’s problems, said Neil Saunders, managing director of GlobalData Retail.

“If you run down an escalator internally, with the external environment, you run down the escalator which is at super speed,” he said. “It’s a very difficult, if not impossible task, because it’s not the best environment to recreate your business.”

It is reportedly seeking a lifeline from lenders. According to a report from The Wall Street Journal, the company is close to finalizing a $400 million loan to give it cash to pay the bills and build credibility with suppliers. The report cites people familiar with the case. The company is finalizing negotiations with Sixth Street Partners, which has lent money to other troubled retailers, including JC Penney, the Journal said.

Bed Bath has made other changes along with the CEO ousting. Former merchandising chief Joe Hartsig, one of the architects of the private label strategy, has left the company along with Tritton. It has a new chief accounting officer. It launched a new loyalty program and has discontinued at least one of its private labels, Wild Sage.

As of Thursday’s close, shares are down about 31% so far this year. Shares closed at $10.10 on Thursday, down about 2.5%. The market value of the company is $807.6 million.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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