Bed Bath & Beyond, Inc. · NYSE:BBBY
Bed Bath & Beyond — Q1 2018 Earnings Presentation
17 slides from Bed Bath & Beyond's earnings presentation, Jun 27, 2018
Slide 1: Forward Looking Statements
Forward Looking Statements This presentation may contain forward-looking statements. Many of these forward-looking statements can be identified by use of words such as may, will, expect, anticipate, approximate, estimate, assume, continue, model, project, plan, goal, and similar words and phrases. T
Slide 2: Our Mission
Our Mission To be trusted by our customers as the expert for the home and heart-felt life events by continuing to build and deliver a strong foundation of differentiated products, services, and solutions while driving operational excellence. Present a meaningfully differentiated and complete product
Slide 3: Our Vision for 2020
Our Vision for 2020 In Fiscal 2018: Grow comp sales In Fiscal 2018 and 2019: Moderate the declines in operating profit and net earnings per diluted share By Fiscal 2020: Grow net earnings per diluted share We remain on track with our annual and 3-year goals, while we continue to evolve our foundatio
Slide 4: Q1 2018 Summary
Q1 2018 Summary Remain on track with fiscal 2018 modeling assumptions and 3-year financial goals Sales of approximately $2.8 billion, up 0.4% versus Q1 2017 Continued strong growth in customer-facing digital channels Diluted EPS of $0.32 per share Retail inventory reduction of approximately $300 mil
Slide 5: Strategic Investments Positioning Our Company for Long-Term Success
Strategic Investments Positioning Our Company for Long-Term Success Assortment Experiences Services Operational Excellence Our Mission: To be trusted as the expert for the home and heart-felt life events. 4 Broad Areas of Focus 6
Slide 6: Key Focus Areas: Accelerate Growth of Decorative Furnishings
Key Focus Areas: Expansive Online Assortment, Differentiated Over Time Quality, Value & Competitive Pricing Convenient & Easy Shopping / Delivery Experience Increase Customer Awareness Supported by an Agile, Cross-Functional Team Decorative Furnishings (DF) Results (1Q 18 vs. 1Q 17): Strong DF sales
Slide 7: Progress Update: Added Decorative Furnishings SKUs
Progress Update: Added >78,000 Decorative Furnishings SKUs* (FY 17); added 24,000 more in 1Q 2018 Increasing the productivity of the assortment using web performance data to edit existing assortment and identify opportunity Developing proprietary brands for launch in FY2019 Accelerate Growth of Deco
Slide 8: Key Focus Areas: Leveraging Real Estate Portfolio
Key Focus Areas: Leveraging Real Estate Portfolio: Numerous near-term renewals provide opportunity to update existing selected stores Evolving and/or New Assortment: to increase shopping trips, transactions and transaction value Scarcity product: Seasonal, Decorative Furnishings Treasure Hunt, and D
Slide 9: Progress Update: Store Remodels Completed
Progress Update: 4 remodels completed Plymouth Meeting, PA (March) Mount Vernon, NY (April) Summerlin, NV (May) Lubbock, TX (June) Iterate quickly after each remodel for continuous improvement and enhance merchandising and customer experience Plan to remodel another 15 stores by late Fall 2018 Anoth
Slide 10: Early Results: Next Generation Store
Early Results: Strong transaction growth in these stores Significant growth in transactions that include new and/or evolving merchandise assortment Core Department: Space reduced by ~10% in these stores; Sales outperforming rest of BBB stores Next Generation Store Favorable Customer Response Experie
Slide 11: Inventory Optimization
Inventory Optimization Inventory Initiatives Driving Benefits Operational Excellence Retail inventories (at cost) reduced ~$170 million Retail inventories (at cost) reduced ~$300 million 13
Slide 12: Marketing Personalization Driving Incremental Revenue
Marketing Personalization Driving Incremental Revenue & Optimizing Customer Experience Key Focus Area: Tailor timing, content and design of messaging to each customer, depending on their attributes, context, and behaviors Supported by an agile, cross-functional team Experiences 14 Progress Update: L
Slide 13: Marketing Personalization: Early Results
Marketing Personalization Driving Incremental Revenue & Optimizing Customer Experience Experiences 15 Early Results: Customer engagement has grown ~15-20% on all marketing personalization tests Identified incremental revenue from marketing personalization initiative Identified enhanced technology to
Slide 14: Q1 2018 P&L Summary
Q1 2018 P&L Summary (amounts in millions, except comp %, and per share data) 17 June 2, 2018 % of Sales May 27, 2017 % of Sales Comp Sales % (a) (0.6) (2.0) Net Sales $2,754 100.0 $2,742 100.0 Gross Profit 965 35.0 1,000 36.5 (1.5) (b) SG&A Expenses 884 32.1 853 31.1 (1.0) (c) Operating Profit 81 2.
Slide 15: Q1 2018 Balance Sheet & Capital Allocation Highlights
Q1 2018 Balance Sheet & Capital Allocation Highlights Cash Position Continued growth of cash and investments Cash and investments of $847 million at end of quarter, increase of approximately $281 million from Q1 2017 Inventory Retail inventory reduction (at cost) of approximately $300 million at end
Slide 16: Fiscal 2018 Modeling Assumptions
Fiscal 2018 Modeling Assumptions Consolidated Net Sales Relatively flat to slightly positive Comparable Net Sales Growth in low-single-digit percentage range Strong growth in customer-facing digital channels Gross Margin Deleverage due to continued investment in customer value proposition and ongoin
Slide 17: Fiscal 2018 Modeling Assumptions
Fiscal 2018 Modeling Assumptions Consolidated Net Sales + Relatively flat to slightly postive Comparable Net Sales + Growth in low-single-digit percentage range + Strong growth in customer-facing digital channels Gross Margin + Deleverage due to continued investment in customer value proposition and