A Bed Bath & Beyond store in Miami, Florida on June 29, 2022.
Joe Ladle | Getty Images News | Getty Images
Bed Bath & Beyond announced Wednesday that it has secured more than $500 million in new funding and is closing stores and laying off staff in an effort to revive its struggling business.
home goods retailers news release Ahead of Wednesday’s early investor update. It is expected to share details about its turnaround strategy.
Bed Bath said it will close about 150 stores with the same name and reduce workforce by about 20% across the company and supply chain.
The company said it received $375 million in financing through Sixth Street Partners, a lender that provides loans to other retailers such as JC Penney and Designer Brands. We also expanded our $1.13 billion asset-backed revolving credit facility.
Earlier Wednesday, the company said in a filing that it would sell its privately held shares. The announcement sent the retailer’s shares plummeting in pre-market trading.
The company also said Wednesday that the slowdown in sales has carried into the current financial quarter. Same-store sales have fallen 26% so far during the period, the steepest decline in years. .
Bed Bath has announced management changes, including the departure of Chief Operating Officer John Hartmann from the company. The company’s board of directors dismissed former CEO Mark Tritton and his chief merchandising officer Joe Hartsig in late June.
The company’s finances and business are in a difficult situation. Retailers have spent money on store renovations, new private labels and stock buybacks, resulting in sluggish sales and a buildup of excess inventories. Net loss he widened to $357.7 million in the most recent quarter. As of the end of May, he had about $100 million in cash, compared to his $1.1 billion a year ago.
That precarious position jeopardizes relationships with suppliers who expect their shelves and warehouses to be stocked, especially during critical seasons like back-to-school and the Christmas season.
Bed Bath’s stock has been on a roller coaster ride fueled by meme stocks for months, surging to $30.06 and slumping to a low of $4.38 over the past year. The stock is down about 17% year-to-date at the close of trading on Tuesday. The stock closed about 9% lower at $12.11 on Tuesday.
Read the company’s news release here.
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