Build-A-Bear Workshop, Inc. Updates Sales Expectations for Fiscal Year 2018 Ahead of ICR Conference

Build-A-Bear Workshop, Inc. (NYSE:BBW) today updated its revenue
expectations for the 2018 fiscal year in conjunction with its
presentation at the ICR Conference 2019.

For the fiscal 2018 year, the Company is lowering revenue guidance
and currently expects:

• Total revenues in the range of $335 million to $340 million for the
  52-week period ending February 2, 2019 inclusive of the negative
  impact of $3.9 million due to the adoption of new accounting standards
  effecting the timing of the recognition of breakage revenue for
  certain gift cards and the nonoccurrence of the prior year benefit of
  $6.0 million for a 53^rd week in revenue. Total revenues
  were $364.0 million for the recast 53-week period ended February 3,
  2018. The $9.9 million impact of these two items would adjust total
  fiscal 2017 recast year revenues to $354.1 million.
• Within the Company’s Direct-To-Consumer segment, total revenues in
  North America are expected to decline by approximately 2% compared to
  the adjusted recast 2017 fiscal year and total revenues in Europe are
  expected decline in the range of 17% to 20% compared to the adjusted
  recast 2017 fiscal year.

Sharon Price John, Build-A-Bear Workshop Chief Executive Officer
commented, “We believe that fiscal 2018 had several anomalies that
converged to negatively impact our business. The shortfall in our year’s
results are largely attributed to the persistent and significant revenue
and profitability challenges in the UK as unresolved issues related to
Brexit negatively impacted consumer confidence and currency exchange
rates and new privacy laws, known as GDPR, impeded our marketing
communications. Other factors included: a decline in licensed product
sales due to significantly fewer family-centric, character-based movies;
the continuation of overall declines and changing composition of mall
traffic; the closure of a flagship store location that represented over
$7 million in North American revenue; liquidation of one of the largest
global toy retailers; and a number of accounting and tax changes that
negatively affected both top and bottom line results. Even with these
disruptions, on a full-year basis, we expect total revenue in our
largest market, North America, which is most reflective of our planned
future state, to be down only low-single digits as compared to an
estimated 17% to 20% revenue drop outside North America, largely
isolated to the UK.

“Post-Christmas, our sales trend has been positive, which includes gift
card redemptions and initial sales of licensed product associated with
the upcoming family film, “How To Train Your Dragon: The Hidden World”,
which will be released next month in the U.S. and the U.K. We also
expect to benefit from a planned integrated event and promotion to
celebrate National Hug Day on January 21^st. With many of this
year’s disruptions behind us, we look forward to moving into 2019 which
has one of the most robust family movie offerings slated throughout the
year, in stark contrast to 2018, including anticipated blockbusters in
“The Lion King” and “Frozen 2.” We continue to believe that the
Build-A-Bear brand remains strong and are focused on our strategies to
monetize that brand equity, diversify our retail footprint with the
optionality that is a result of innovation in flexible store models and
aggressive lease negotiations, and digital growth opportunities
leveraging our more than 6 million loyalty program members to increase
lifetime value.”

The Company is scheduled to present at the at the ICR Conference 2019
held at the Grande Lakes Hotel and Resort in Orlando, Florida on Monday,
January 14, 2019, at 9:00 a.m. EST. The presentation will be broadcast
over the internet and can be accessed at the Company’s investor
relations website, http://IR.buildabear.com.
The presentation is expected to conclude by 9:25 a.m. EST. A replay of
the broadcast will remain on the Company’s investor relations website
for one year.

About Build-A-Bear Workshop, Inc.

Build-A-Bear is a global brand kids love and parents trust that seeks to
add a little more heart to life. Build-A-Bear Workshop has over 400
stores worldwide where guests can create customizable furry friends,
including corporately-managed stores in the United States, Canada,
China, Denmark, Ireland, Puerto Rico, and the United Kingdom, and
franchise stores in Africa, Asia, Australia, Europe, Mexico and the
Middle East. In 2018, Build-A-Bear was named to the FORTUNE 100 Best
Companies to Work For® list for the 10th year in a row. Build-A-Bear
Workshop, Inc. (NYSE:BBW) posted total revenue of $357.9 million in
fiscal 2017. For more information, visit the Investor Relations section
of buildabear.com.

Forward-Looking Statements:

This press release contains certain statements that are, or may be
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reflect our current views with respect to future events and financial
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“continue,” the negative or any derivative of these terms and other
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liquidity, future revenues, margins and other future financial
performance and results, achievement of operating of financial plans or
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liquidity, future cash flows and cash needs, success and results of
strategic initiatives and other future financial performance or
financial position, as well as our assumptions underlying such
information, constitute forward-looking information.

These statements are based only on our current expectations and
projections about future events. Because these forward-looking
statements involve risks and uncertainties, there are important factors
that could cause our actual results, level of activity, performance or
achievements to differ materially from the results, level of activity,
performance or achievements expressed or implied by these
forward-looking statements, including those factors discussed under the
caption entitled “Risks Related to Our Business” and “Forward-Looking
Statements” in our Annual Report on Form 10-K filed with the Securities
and Exchange Commission (“SEC”) on March 15, 2018 and other periodic
reports filed with the SEC which are incorporated herein.

All of our forward-looking statements are as of the date of this Press
Release only. In each case, actual results may differ materially from
such forward-looking information. We can give no assurance that such
expectations or forward-looking statements will prove to be correct. An
occurrence of or any material adverse change in one or more of the risk
factors or other risks and uncertainties referred to in this Press
Release or included in our other public disclosures or our other
periodic reports or other documents or filings filed with or furnished
to the SEC could materially and adversely affect our continuing
operations and our future financial results, cash flows, available
credit, prospects and liquidity. Except as required by law, the Company
does not undertake to publicly update or revise its forward-looking
statements, whether as a result of new information, future events or
otherwise.

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