Best Buy Announces Holiday Revenue Results

Fri Jan 11, 2013 7:00am EST

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Domestic comparable store sales flat

Free cash flow guidance updated
MINNEAPOLIS--(Business Wire)--
Best Buy Co., Inc. (NYSE: BBY) today announced revenue of $12.8 billion for the
nine weeks ended January 5, 2013 compared to $12.9 billion for the nine weeks
ended December 31, 2011.

 Fiscal 2013 Holiday Revenue Summary                                                                                             
 ($ billion)                                                                                                                     
                                                                      Comparable Store Sales %                                   
                                                                       Change1                                                   
                                                 Revenue %            9 weeks ended                                              
                              Revenue            Change               Jan. 5, 2013                                Dec. 31, 2011  
 Total company                $12.8              (0.4)                (1.4)                                       (0.4)          
 Domestic segment             $9.9               (1.2)                0.0                                         0.3            
 International segment        $2.9               2.2                  (6.4)                                       (3.1)          
                                                                                                                                 


"One of the first priorities of our Renew Blue strategy is to stabilize and then
begin improving our comparable store sales. During the most important period in
the retail calendar - the holiday sales season - we were able to improve our
Domestic comparable store sales trends compared to the performance of the last
several quarters and continue our strong traffic growth in our online business.
Our holiday selling strategy, backed by a compelling assortment, increased
employee training and price match policy, allowed us to deliver these results,"
said Best Buy President and CEO Hubert Joly. "While it will be a journey with
ups and downs, we are focused on becoming an increasingly effective
multi-channel retailer and engaging with the tens of millions of consumers who
shop us online and in-store," Joly added. 

Best Buy`s Domestic segment online channel delivered revenue of $1.1 billion, a
10 percent revenue increase compared to the prior-year period, driven by a
traffic increase. Best Buy`s strong online performance was recognized by various
third parties, in particular:

* ComScore indicated Best Buy was in the top three most trafficked websites for
the Thanksgiving holiday and Black Friday 
* Experian data ranked Best Buy as the No. 3 retail website on Cyber Monday with
9.3 million visits

Domestic comparable store sales for the period were flat. The company recorded
positive comparable store sales growth in mobile phones, tablets/eReaders and
appliances. In contrast, comparable store sales in entertainment, televisions
and computing declined. 

The International segment comparable store sales decline of 6.4 percent was
driven by comparable store sales declines in Canada and China. Sales results for
all countries in the International segment other than Canada are reported on a
one-month lag. 

Fiscal 2013 Financial Guidance

Driven by solid performance in the holiday period, comparable store sales, gross
margin, earnings and inventory levels continue to be in line with the
assumptions that supported the company`s fiscal year 2013 free cash flow2
guidance provided on November 20, 2012 that was in the range of $850 million to
$1.05 billion. Accounts payable as a percentage of inventories, however, which
was assumed to be consistent with prior year, is now expected to be lower than
prior year due to (1) the earlier than expected receipt, and therefore payment
of, inventory purchases and (2) a shift in sales mix to higher velocity
merchandise categories that carry shorter payment terms (note: overall vendor
payment terms were consistent with prior year). As a result, the company now
expects free cash flow for fiscal year 2013 to be approximately $500 million. As
consistent with previous guidance, this free cash flow estimate excludes the
impact of previously announced restructuring activities and change in restricted
cash related to working capital. 

(1) Best Buy`s comparable store sales is comprised of revenue at stores, call
centers, and websites operating for at least 14 full months as well as revenue
related to other comparable sales channels. Relocated stores, as well as
remodeled, expanded, and downsized stores closed more than 14 days, are excluded
from the comparable store sales calculation until at least 14 full months after
reopening. Acquired stores are included in the comparable store sales
calculation beginning with the first full quarter following the first
anniversary of the date of the acquisition. The portion of the calculation of
the comparable store sales percentage change attributable to the International
segment excludes the effect of fluctuations in foreign currency exchange rates.
The method of calculating comparable store sales varies across the retail
industry. As a result, Best Buy`s method of calculating comparable store sales
may not be the same as other retailers` methods. Online revenue is included in
Best Buy`s same store sales calculation. 

(2) Best Buy defines free cash flow as total cash provided by (used in)
operating activities less additions to property and equipment. This non-GAAP
financial measure assists investors in making a ready comparison of the
company`s expected free cash flow for the year ending February 2, 2013, against
the company`s results for the respective prior-year periods and against
management`s previously provided expectations. The company`s free cash flow
guidance excludes the impact of previously announced restructuring activities
and includes an expected benefit from a change in restricted cash related to
working capital, which is included within investing activities on the condensed
consolidated statements of cash flows. This non-GAAP financial measure should
not be considered superior to, as a substitute for, or as an alternative to, and
should be considered in conjunction with, GAAP financial measures and may differ
from similar measures used by other companies. 

Forward-Looking and Cautionary Statements:

This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 as contained in Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934 that reflect management`s current views and estimates regarding future
market conditions, company performance and financial results, business
prospects, new strategies, the competitive environment and other events. You can
identify these statements by the fact that they use words such as "anticipate,"
"believe," "assume," "estimate," "expect," "intend," "project," "guidance,"
"plan," "outlook," and other words and terms of similar meaning. These
statements involve a number of risks and uncertainties that could cause actual
results to differ materially from the potential results discussed in the
forward-looking statements. Among the factors that could cause actual results
and outcomes to differ materially from those contained in such forward-looking
statements are the following: general economic conditions, changes in consumer
preferences, credit market constraints, acquisitions and development of new
businesses, divestitures, product availability, sales volumes, pricing actions
and promotional activities of competitors, profit margins, weather, natural or
man-made disasters, changes in law or regulations, foreign currency fluctuation,
availability of suitable real estate locations, the company`s ability to react
to a disaster recovery situation, the impact of labor markets and new product
introductions on overall profitability, failure to achieve anticipated benefits
of announced transactions, integration challenges relating to new ventures and
unanticipated costs associated with previously announced or future restructuring
activities. A further list and description of these risks, uncertainties and
other matters can be found in the company`s annual report and other reports
filed from time to time with the Securities and Exchange Commission, including,
but not limited to, Best Buy`s Annual Report on Form 10-K filed with the SEC on
May 1, 2012. Best Buy cautions that the foregoing list of important factors is
not complete, and any forward-looking statements speak only as of the date they
are made, and Best Buy assumes no obligation to update any forward-looking
statement that it may make. 

About Best Buy Co., Inc.

Best Buy Co., Inc. (NYSE: BBY) is the global leader in consumer electronics. We
offer a unique promise to our large and loyal customer base including the latest
devices and services; competitive prices; and the ability to shop when and where
you want. Additionally, our "Blue Shirt" sales associates and Geek Squad agents
are the authority on consumer electronics, delivering unbiased, knowledgeable
advice hundreds of millions of times a year and offering unmatched support for
the lifetime of the products we sell. Shop online at http://www.bestbuy.com/ or
stop by one of our Best Buy or Best Buy Mobile stores to touch, test and try the
latest technology. To learn more about Best Buy, visit us at
http://www.investors.bestbuy.com/. Find us on Facebook at
https://www.facebook.com/bestbuy and follow us on Twitter at @BestBuy.

 BEST BUY CO., INC.                                                                                                           
 REVENUE CATEGORY SUMMARY                                                                                                     
 (Unaudited and subject to reclassification)                                                                                  
                                                                                                                              
 Domestic Segment Summary                                                                                                     
                                  Revenue Mix Summary                            Comparable Store Sales                       
                                  Nine Weeks Ended                               Nine Weeks Ended                             
                                  Jan. 5, 2013                Dec. 31, 2011      Jan. 5, 2013                  Dec. 31, 2011  
 Consumer Electronics             36%                         39%                (7.0%)                        (3.5%)         
 Computing and Mobile Phones      42%                         36%                14.0%                         13.7%          
 Entertainment                    13%                         16%                (17.8%)                       (16.3%)        
 Appliances                       4%                          4%                 10.7%                         14.8%          
 Services(1)                      4%                          4%                 (3.1%)                        (3.4%)         
 Other                            1%                          1%                 n/a                           n/a            
 Total                            100%                        100%               0.0%                          0.3%           
                                                                                                                              
                                                                                                                              
                                                                                                                              
 International Segment Summary                                                                                                
                                  Revenue Mix Summary                            Comparable Store Sales                       
                                  Nine Weeks Ended                               Nine Weeks Ended                             
                                  Jan. 5, 2013                Dec. 31, 2011      Jan. 5, 2013                  Dec. 31, 2011  
 Consumer Electronics             26%                         22%                (16.0%)                       (6.8%)         
 Computing and Mobile Phones      52%                         57%                0.3%                          1.7%           
 Entertainment                    8%                          7%                 (16.0%)                       (15.4%)        
 Appliances                       8%                          8%                 (12.3%)                       2.0%           
 Services(1)                      6%                          6%                 6.3%                          (5.7%)         
 Other                            <1%                         <1%                n/a                           n/a            
 Total                            100%                        100%               (6.4%)                        (3.1%)         
                                                                                                                              
 (1) The "Services" revenue category consists primarily of service contracts, extended warranties, computer related services, product repair and delivery and installation for home theater, mobile audio and appliances. 


Best Buy Co., Inc.
Investor Contacts:
Bill Seymour, 612-291-6122
Vice President, Investor Relations
bill.seymour@bestbuy.com
or
Mollie O`Brien, 612-291-7735
Director, Investor Relations
mollie.obrien@bestbuy.com
or
Media Contact:
Amy von Walter, 612-291-4490
Senior Director, Public Relations
amy.vonwalter@bestbuy.com

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