Bed Bath & Beyond Inc. may find it hard to justify making coming interest payments of roughly $28 million as its cash dwindles, WSJ Pro Bankruptcy reported. The coming payments, due Feb. 1, are the next big hurdle the beleaguered housewares retailer faces as it looks for ways to keep its business going. Bed Bath & Beyond has coupons due on all of its $1.2 billion in bonds outstanding as of August, and while it has more than enough cash on hand to make the payments, it will face a difficult choice between staying current on its debts and conserving its cash as it charts its future course. The housewares retailer, which warned last week it may have to file for bankruptcy, burned over $300 million in cash in the quarter ended Nov. 26 and reported having $500 million in cash and credit lines to draw on for additional funds. If it does miss the interest payment, Bed Bath & Beyond will have a 30-day grace period during which it can come forward with funds before the company would be considered as being in default and before its bondholders and other creditors can take legal action. Bed Bath has said it is exploring raising debt or equity, as well as filing for bankruptcy. On Tuesday, the company said it is planning to make up to $100 million in cost cuts, including through layoffs.
