Build-A-Bear Workshop's Q2 Earnings Beat, Sees Strong Improvement In Q3-YTD Web Demand

Build-A-Bear Workshop, Inc. BBW shares are trading higher after it reported second-quarter revenue growth of 2.4% Y/Y to $111.8 million, beating the analyst consensus of $108.5 million.

Consolidated e-commerce demand, including online orders fulfilled from the warehouse or stores, fell by 28.2%.

Quarterly commercial and international franchise revenues were a combined $8.3 million and upped 44.8% Y/Y. EPS of $0.64 (+12.3% Y/Y), beating the Wall Street View of $0.57. 

In the quarter, the company added 17 new global experience locations, including four corporately managed, ten partner-operated, and three franchise locations.

By the end of the quarter, Build-A-Bear had 548 global locations across its corporately-managed, partner-operated, and franchise models.

Inventory at year-end was $67.0 million, reflecting an increase of $0.7 million, or 1.0% Y/Y. As of August 3, cash and cash equivalents totaled $25.2 million.

In the second quarter, the company repurchased shares worth $9.1 million and paid a $2.7 million quarterly cash dividend to shareholders.

Outlook: Build-A-Bear Workshop maintains its FY24 guidance (vs. 53-week FY23), expecting low-to-mid-single-digit revenue growth and pre-tax income growth at a low-single-digit percentage basis.

For FY24, the St. Louis, Missouri-based company continues to expect net new unit growth of at least 50 experience locations through a combination of corporately managed, partner-operated, and franchised business models.

Sharon Price John, President and Chief Executive Officer of Build-A-Bear Workshop, said, “With increasing momentum for our experience locations starting in the second quarter, and continuing into August, and with strong improvement in web demand on a third quarter-to-date basis, we remain confident in our annual guidance.”

Price Action: BBW shares are up 9.44% at $30.50 premarket at the last check Thursday.

Photo via Wikimedia Commons

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