Despite mixed results for the fourth quarter and full-year 2020, Bed Bath & Beyond is coming out of 2020 with its eyes set on a successful future driven by new goals, including a big push in own brands. The Union, N.J.-based retailer posted its fourth-quarter and full-year 2020 earnings Wednesday, which showed big digital growth and solid comparable-store sales, even as it swung to a loss for the full year.
"Fiscal 2020 was a year of fast-paced transformation in which we reformed the past, overcame extraordinary circumstances of the present, and established a firm foundation for the future,” said Mark Tritton, president and CEO of Bed Bath & Beyond. “Despite the challenges created by the COVID-19 pandemic, we relentlessly focused on taking purposeful and bold steps to transform our entire organization and remained true to our plans to rebuild our authority in home and restore this iconic company. Importantly, we prioritized the health and wellbeing of our associate teams, customers and communities and I am so proud of how our people have come together to deliver for one another and the millions of people who count on us.
For the quarter ended Feb. 27, BB&B saw sales of $2.6 billion, which, despite coming in 16% below the prior year’s Q4, saw improved net income of $9 million (compared with a $65 million loss in Q4 2019) and led to 8 cents in earnings per share. For the quarter, comparable sales growth for the Bed Bath & Beyond banner was up 6% while digital comps nearly doubled, with a 99% increase over the previous-year period.
For the year, the company saw net sales of $9.2 billion and posted a loss of $150.7 million — an improvement over the more than $600 million loss that the retailer saw in fiscal 2019. Bright spots highlighted by the company included more than $3 billion in digital sales, as well as a 95% increase in the number of digital customers it served over the previous fiscal year, adding 10.6 million new online shoppers. The company also noted that it now has reduced its debt by roughly $1 billion and some $2 billion in liquidity. Over the course of the year, BB&B closed 144 stores as it undertakes a network optimization program, and it divested Cost Plus World Market as the last move in its portfolio transformation.
"We are excited to start fresh in 2021 with our sharpened size and scale, a healthier portfolio of core banners and a stronger financial position to execute the first phase of our three-year transformation journey,” Tirtton said.
Private brands are set to play a big role in the company’s transformation. Already this year, the retailer has rolled out two of the six owned brands it is set to launch in the next year, with an overall target of 10 new private brands by 2022. Store Brands has profiled the team behind the private label effort at the retailer, as well as Tritton’s vision inspired by his time at Target.
The company also has rolled out one of its largest-ever brand campaigns meant to position itself a as a home-goods leader and authority. The campaign, dubbed “Home, Happier,” includes a marketing component, as well as in-store and online experience updates. It also includes a TV spot that began airing nationally April 14, alongside streaming, online video, paid social, print, in-store and email components. It also will be giving its in-store employees new uniforms — including aprons, name tags, branded face coverings and more — as part of the initiative.
“The new uniform is designed for the comfort of associates, but also reflects the company's commitment to making customers feel welcome and enabling them to easily find a store associate,” the company said.
For fiscal 2021, the company reaffirmed its guidance, projecting net sales of between $8 billion and $8.2 billion, as well as between $500 million and $525 million in adjusted EBITDA.