On May 30, 2024, Build-A-Bear Workshop Inc (BBW, Financial) released its 8-K filing detailing the financial results for the first quarter of fiscal year 2024, which ended on May 4, 2024. Build-A-Bear Workshop Inc is a U.S.-based specialty retailer of customized stuffed animals and related products, operating through three segments: Direct-to-consumer, International franchising, and Commercial.
Performance and Challenges
Build-A-Bear Workshop Inc reported total revenues of $114.73 million for Q1 2024, falling short of the analyst estimate of $120.58 million. The company also reported earnings per share (EPS) of $0.82, which was below the estimated EPS of $1.03. The company attributed the shortfall to continued web demand challenges and a weaker spending environment.
“Although first quarter results were slightly below internal expectations due to some continued web demand challenges and a weaker spending environment, we remain confident in our annual guidance,” commented Sharon Price John, President and Chief Executive Officer of Build-A-Bear Workshop.
Financial Achievements
Despite the challenges, Build-A-Bear Workshop Inc highlighted several financial achievements. The company reported a net income of $11.46 million, demonstrating a significant profitability compared to pre-Covid first quarters. Additionally, the company returned nearly $30 million to shareholders through share repurchases and dividends over the past twelve months, including $12 million in the first quarter alone.
“The quarter was significantly more profitable than any pre-Covid first quarter since our IPO, demonstrating the sustainability of our transformed business model,” noted Voin Todorovic, Chief Financial Officer of Build-A-Bear Workshop.
Income Statement Highlights
| Metric | Q1 2024 | Q1 2023 |
|---|---|---|
| Total Revenues | $114.73 million | $120.05 million |
| Net Income | $11.46 million | $14.61 million |
| EPS (Basic) | $0.82 | $1.01 |
| EPS (Diluted) | $0.82 | $0.98 |
Balance Sheet and Cash Flow
As of the end of Q1 2024, Build-A-Bear Workshop Inc reported cash and cash equivalents totaling $38.2 million, an increase of 16.5% compared to the same period last year. The company had no borrowings under its revolving credit facility. Inventory levels were reported at $64.0 million, reflecting a decline of 3.7% compared to the previous year.
Store Activity and Expansion
During the quarter, Build-A-Bear Workshop Inc experienced net new unit growth of six global experience locations, including five partner-operated locations and three franchise locations, offset by the closure of two corporately-managed locations. The company now operates 531 global locations, comprising 357 corporately-managed stores, 97 partner-operated stores, and 77 franchise stores.
Return of Capital to Shareholders
In Q1 2024, the company utilized $9.2 million in cash to repurchase 343,406 shares of its common stock and paid a $2.9 million quarterly cash dividend to shareholders. Since the end of the first quarter, the company has repurchased an additional 66,476 shares, with $15.0 million remaining under the Board authorized $50.0 million stock repurchase program.
2024 Outlook
Build-A-Bear Workshop Inc reaffirmed its fiscal 2024 outlook, expecting growth in total revenues and pre-tax income compared to fiscal 2023. The company’s guidance considers ongoing inflationary pressures and increased freight costs, assuming no further material changes in the macroeconomic or geopolitical environment.
For more detailed insights and the full earnings report, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Build-A-Bear Workshop Inc for further details.
