Bed Bath & Beyond CEO Mark Tritton sounds like a veteran retail executive ready to pour 93-octane gas on a budding turnaround when Yahoo Finance caught up with him after his early morning breakfast via a Zoom call Wednesday.
Tritton — with successful stints as a top executive at Nike, Timberland and Target — is hesitant to get pinned down on what inning the turnaround at the home goods retailers is in as he approaches one year atop the company. Wall Street has asked him the ‘innings’ question repeatedly, but he still isn’t biting even on a full stomach. But what he will say is that the runs for him and his entirely new executive team are starting to pile up on the scoreboard.
“We've been training and playing at the same time. I'm not great at sports analogies but what I would say is that we are starting to really get some great goals and we're starting to get some runs on the board. So I think we're up and running,” Tritton tells Yahoo Finance.
Judging by Bed Bath & Beyond stock’s 80% advance this past year and steady stream of positive news, Tritton’s analogy is on the mark.
Bed Bath & Beyond announced Tuesday evening it will sell its Christmas Tree Shops brand and a New Jersey distribution center for a cool $250 million. This comes a few weeks after Bed Bath & Beyond said its most recent quarterly same-store sales spiked 6%, spurred by the pandemic causing people to reinvest in their homes.
The asset sales disclosed Tuesday are the latest in a flurry of actions by Tritton, who has moved very quickly to divest non-core businesses to raise cash, begin reinvestment in a business that old management left to die and shore up the balance sheet.
Other strategic moves by Tritton include a sale leaseback of 2.1 million square feet in commercial real estate in January. That netted the company $250 million. In August, the company closed on a $250 million sale of personalizationMall.com to 1-800-Flowers. It was an asset that most on Wall Street never even knew about, let alone it being worth $250 million.
“We are supportive of management's actions to sell non-core assets and focus time and resources on reinvigorating Bed Bath & Beyond and growing buybuy BABY,” remarked Jefferies analyst Jonathan Matuszewski in a note to clients soon after the Christmas Tree Shops sale news.
The company also trimmed its workforce by 2,800 people and will close about 200 stores.
The wheeling and dealing (which includes improving its credit terms with lenders) across the board has upped bed Bed, Bath & Beyond’s total liquidity to more than $2.2 billion. To be sure that is quite a cash war chest for Tritton as he prepares to unleash phase two of an operation we are calling “Bring Back BBBY.”
Tritton and his executives will share more on that at a key Oct. 28 investor day. But, it’s likely Tritton will take the wraps off plans to expand aggressively into higher margin private label products (like what he did at prior employer Target) and invest in the company’s online infrastructure (which prior management forgot to do). Executives will also probably outline a clear plan for children’s goods brand buybuy BABY, which is still viewed as a core asset for the company.
Adds Tritton, “We are working on all cylinders, but working together as one team. And I think that the past was really problematic, and it wasn't heading in the right direction. And so for us, we don't focus on the spilt milk — we focus on the pathway ahead, and we have a really strong pathway.”
Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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