New York City Bed Bath & Beyond on Wednesday posted an unexpected rise in quarterly profit by cutting costs to offset slumping demand for home furnishings. Net income for the fiscal first quarter ended May 30 rose to $87.17 million, from $76.78 million a year earlier.
Sales rose 2.8% to $1.69 billion as it opened more stores, but same-store sales fell 1.6%.
Selling, general and administrative expenses declined to $524.5 million in the quarter from $537.18 million a year earlier.
Capital expenditures are expected to be about $250 million for the 2009 fiscal year as Bed Bath & Beyond upgrades its information technology equipment, refurbishes old stores and opens about 57 new stores.
“We are confident that we will be able to look back at this period as one that afforded us an exceptional opportunity to gain market share and to improve our competitive position," company executive Steven Temares said during the company's quarterly conference call.
McGranahan said the results show Bed Bath & Beyond has gained market share since former rival Linens ’n Things went out of business.