Union, N.J. — Bed Bath & Beyond Inc. (NASDAQ: BBBY) announced this morning that it will close approximately 150 of its lower-producing stores across the country. The Union-based home goods retailer also revealed that it is cutting its workforce by about 20 percent across its corporate and supply chain staff.
Additionally, the company has secured more than $500 million in new financing, including the expansion of an existing credit line and a new $375 million loan. Bed Bath & Beyond says that these moves are in effort to meet demand of customers, drive growth and profitability, and improve its balance sheet and cash flows.
“We are embracing a straightforward, back-to-basics philosophy that focuses on better serving our customers, driving growth and delivering business returns,” says Sue Gove, director and interim CEO. Bed Bath & Beyond has retained national firm Russell Reynolds in its search for a permanent CEO.
The retailer is also readjusting its inventory, bringing back popular national brands. The company will discontinue three of its nine private brands, including Haven, Wild Sage and Studio 3B.
In its second fiscal quarter that ended Saturday, Aug. 27, Bed Bath & Beyond reported comparable sales decline of approximately 26 percent compared with the same period a year ago. The company also burned through about $325 million of its cash reserves.
Following these announcements, Bed Bath & Beyond’s stock price tumbled from $12.11 per share at the close of business on Tuesday, Aug. 30, to $8.86 per share this morning. One year ago, the retailer’s stock price traded at $27.54 per share.
Bed Bath & Beyond operates more than 900 locations across North America. A list of specific store closures was not released.
— Kristin Hiller