Why Build-A-Bear Workshop Shares Are Jumping Today

Build-A-Bear Workshop Inc BBW reported second-quarter FY23 sales growth of 8.5% year-on-year to $109.22 million, beating the analyst consensus of $101.88 million.

Net retail sales rose 7.9% Y/Y, and e-commerce demand increased 14.1%.

Gross profit increased 17.5% Y/Y to $58.6 million. The gross margin of 53.7% expanded by 410 basis points Y/Y.

The company held $32.6 million in cash and equivalents as of July 29, 2023.

EPS of $0.57 beat the Street view of $0.41.

As of July 29, 2023, the company had $35.3 million available under the current $50.0 million stock repurchase program adopted on August 31, 2022.

As of July 29, 2023, the company had 491 global locations through a combination of its corporately-managed, partner-operated, and international franchise models.

Inventory at quarter end was $66.3 million, reflecting a decline of $21.4 million, or 24.4% from July 30, 2022.

Outlook: Build-A-Bear continues to expect FY23 revenues to increase 5% - 7%. The company expects FY23 capital expenditure of $15 million - $20 million.

Sharon Price John, President and CEO, said, "We enter the second half of the year, with positive momentum, and expect to drive growth by the continued opening of corporate and partner-operated locations, a strong product pipeline, and impactful marketing campaigns, highlighted by the new heart-warming film featuring our multi-year best-selling holiday collection, 'Glisten and the Merry Mission.'"

Price Action: BBW shares traded higher by 16.81% at $28.49 in premarket on the last check Thursday.