Bed Bath & Beyond has expressed “substantial doubts about the company’s ability to continue” due to a worsening financial situation.
The US retailer, which specialises in domestic merchandise but which also sells health and beauty goods, made the revelation in a ‘notification of late filing’ to the US Securities and Exchange Commission on Thursday.
The company warned that a bankruptcy filing could be a potential outcome.
Bed Bath & Beyond revealed that it expects to report a net loss of approximately US$385.8m for the three months ended 26 November 2022.
In the filing, it said: “While the company continues to pursue actions and steps to improve its cash position and mitigate any potential liquidity shortfall, based on recurring losses and negative cash flow from operations for the nine months ended 26 November 2022 as well as current cash and liquidity projections, the company has concluded that there is substantial doubt about the company’s ability to continue as a going concern.”
In a media statement, also issued yesterday, Bed Bath & Beyond said the poor performance reflected lower customer traffic and reduced levels of inventory availability, among other factors.
Sue Gove, President & CEO of Bed Bath & Beyond, added: “We have a clear vision for the future of the company.
“Today’s announcement underscores the importance of having initiated a turnaround at the start of the third quarter and why we strengthened our leadership team to execute each step with precision.”
Gove herself was named Bed Bath & Beyond’s boss in October 2022, while Bart Sichel was appointed EVP, Chief Marketing & Customer Officer in November, with the promotion of Scott Lindblom to Chief Technology & Digital Officer announced shortly after.
This leadership team reshuffle followed the death of CFO Gustavo Arnal, who fell from a Manhattan skyscraper in September.
Gove continued: “Our plan has two anchors: the first enables us to refocus merchandising and inventory, operate more efficiently, and grow our digital and omni-capabilities, and the second focuses on strengthening our financial position.
“Transforming an organisation of our size and scale requires time, and we anticipate that each coming quarter will build on our progress.”
Bed Bath & Beyond said it was considering all strategic alternatives including restructuring or refinancing its debt, seeking additional debt or equity capital, reducing or delaying its business activities and strategic initiatives, or selling assets.
It further revealed that it would consider obtaining relief under the US Bankruptcy Code, adding: “These measures may not be successful.”