Bed Bath & Beyond will be closing a minimum of 40 of its stores this year, Chief Financial Officer Robyn D'Elia said in an earnings conference call on April 10.
“This number will grow unless we are able to negotiate more favorable lease terms with our landlords,” D'Elia said.
The company will open 15 new stores under its new “Next Generation Lab stores” in an effort to improve in-store customer experiences and increase revenue.
“The foundational initiatives that we have been focused on are intended to drive four key objectives,” Steven Temares, Chief Executive Officer, said in the conference call. “Mid- and long-term revenue growth, near term and ongoing gross margin improvements, near term and ongoing SG&A (selling, general and administrative expenses) improvements, and current and sustainable world class operational support.”
Temares laid out the company’s strategy to stay competitive and increase revenue.
“Our efforts to drive mid- and long-term revenue growth is centered on several initiatives,” Temares said.
Dissatisfied Activist Group
In a press release on March 26 from Bed bath & Beyond, a response was made to a group of investors referred to as the “Activist Group” after the group’s attempt to replace the entire Bed Bath & Beyond board of directors that includes CEO Temares.Three groups of investors, Legion Partners Asset Management, Macellum Advisors GP, and Ancora Advisors had stated that collectively, they held a 5 percent stake in the company, and motioned to replace the entire board of directors with 16 nominees at the company’s annual shareholder meeting.
“Bed Bath & Beyond regularly engages with our shareholders and welcomes constructive input focused on enhancing value,” Bed Bath & Beyond stated in response. “Members of our Board of Directors and senior management team have met with and held several discussions with Legion and Macellum over the past few weeks. Ancora has not previously reached out to or engaged with the Company.”
“We asked on several occasions for their suggestions and ideas for improving the Company’s business but they did not provide any,” said the press release. “We also invited them to participate in the Board refreshment program we have been undertaking in recent years and are in the process of accelerating with investor input. Instead they chose to publicly attack the Company and provide their intent to nominate directors to take over the full Board.”
The press release stated that the board is committed to the best interest of all shareholders and to the company’s strategic priorities.
“The Board recognizes the value of fresh perspectives and diversity in the boardroom and regularly evaluates its composition to ensure it reflects the right mix of skills and expertise,” said the press release. “Notably, as part of the Board’s ongoing refreshment program, three new independent directors with relevant experience have been added during the last two years.”
Shares of Bed Bath & Beyond rose as much as 30 percent after the “Activist Group” called for the change in the board of directors.