Third quarter same store sales at Bed Bath & Beyond were negatively affectivd by Hurricane Sandy, but the nation’s leading home good retailer still managed to grow profits.
Sales increased 15.3% to $2.7 billion, largely due to two acquisitions earlier in the year, while same store sales advanced 1.7% and were negatively affected by an estimated .9% due to Sandy. Net income for the third quarter ended November 24, increased 1.8% to $233 million, however, the company managed to grow earnings per share 8.4% to $1.03 from 95 cents the prior year thanks to aggressive share repurchase activity. The company spent $191 million during the third quarter to buy back roughly 3.1 million shares.
The high level of repurchase activity dropped the program’s remaining authorization to $223 million and prompted the board to authorize an additional $2.5 billion for share repurchase activity.
"Our board authorized this new share repurchase program based upon its continued confidence in our company's long-term growth potential, financial outlook and cash flow generation," said CEO Steven Temares. "It is anticipated that this $2.5 billion share repurchase program will be funded from current cash and future cash flows. That said, our company's board of directors continues to review our capital structure on an ongoing basis. In addition to providing value to our shareholders through share repurchase programs, our strong operations should allow us to continue to invest in our infrastructure and maintain our flexibility to take advantage of opportunities as they may arise."
Several opportunities arose earlier this year when Bed Bath & Beyond acquired Linen Holdings in early June and then later the same month bought Cost Plus. The deals boosted the company’s retail footprint and gave the company a total of 1,466 locations. Included in that total are 1,003 Bed Bath & Beyond stores, 264 stores under the names of World Market, Cost Plus World Market, or World Market Stores, 74 stores under the names of Christmas Tree Shops or andThat!, 78 buybuy BABY stores and 47 stores under the names of Harmon or Harmon Face Values.
Despite the company’s sizable footprint, co-founder and co-chairman Leonard Feinstein reiterated the company’s long term growth prospects.
"We believe that throughout the United States and Canada, there is an opportunity to operate in excess of 1,300 Bed Bath & Beyond stor