Bed Bath & Beyond (NASDAQ:BBBY)
As the ailing home retailer Bed Bath & Beyond (NASDAQ:BBBY) began an “at-the-market” offering program to sell up to $300 million shares, BBBY stock dropped by almost 25% shortly after the market opened on Thursday.
The firm has engaged in a stock purchase agreement and a registration rights agreement with B. Riley Principal Capital II to acquire more capital. These agreements were done in conjunction with the offering.
Meanwhile, BBBY stock is ending its initial public equity offering and any and all warrants for Series A Convertible Preferred Stock that were still outstanding in connection with that offering.
The potential net revenues from these financing transactions will be used immediately to satisfy the requirements indicated in an amendment to the company’s credit facility submitted earlier today.
In addition, Bed Bath & Beyond published preliminary results for the fourth quarter of the fiscal year 2022, projecting net sales of roughly $1.2 billion. This figure is much lower than analysts’ average estimate of $1.41 billion.
Comparable sales for the prior quarter 4 are anticipated to fall by 40–50%, with negative operational losses continuing. In addition, the store, which has its headquarters in Union, New Jersey, has a moderate free cash flow consumption.
According to Sue Gove, president, and chief executive officer of Bed Bath & Beyond Inc., “Because of the steps we’ve taken, we’ve been able to build the necessary financial runway to get started on repairing our iconic brands, Bed Bath & Beyond and Buybuy Baby. Since the beginning of February, we have successfully completed the repayment of material amounts of our ABL facility, cured our default under our credit agreement, raised 360 million dollars in equity capital, and made our interest payment for our Senior Notes while simultaneously kickstarting our turnaround plans.”
BBBY stock has dropped by around 97% in the previous 12 months.
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