Simmons '02 sales up 9.4%
By Furniture Today Staff -- Furniture Today, March 9, 2003
Atlanta — Aided by brisk sales of upper-end products, bedding major Simmons Co. said sales jumped 9.4% in 2002.
The company reported a profit of $24.4 million for the year ended Dec. 28. That compares with a net loss of $1.1 million in 2001.
"We made outstanding progress in 2002 in a number of areas, adding new customers and improving our product mix," said Simmons Chairman Charlie Eitel. "Growing our top line in the current environment is quite an accomplishment."
Last year's sales totaled $670.4 million, compared with $613 million in 2001. Fourth-quarter sales were $156.1 million, up from $145.8 million the previous quarter.
The sales figures employ an accounting change that requires manufacturers to reduce net sales by the amount of money given to retailers for co-op advertising and other cash incentives. Without the accounting change, 2002 sales would have been $720.8 million.
Eitel said in a conference call with analysts that unit sales increased 5.6% in the fourth quarter, the first unit sales increase since the first quarter of 2000. He said the company had a 5.7% drop in unit sales for the first three quarters, but recorded a 10.7% increase in the average unit selling price.
Operating margins improved significantly last year due to stringent cost controls, he said. Earnings before interest, taxes, depreciation and amortization jumped 26.8% to $99.3 million for the year. Fourth-quarter EBITDA was up 8.5% to $23.4 million.
Eitel said Simmons' business has been brisk so far in 2003 despite a "very difficult environment," but he believes industry-wide unit sales were off as much as 7% to 8% in February.
"The new BackCare line is on fire," he said. "The average unit selling price is very close to Beautyrest," the company's flagship line.
| Simmons | |||
|---|---|---|---|
| All figures in parentheses are losses or declines. | |||
| Quarter ended 12/28 | 2002 | 2001 | Change |
| (a) Includes pretax charges for stock-based compensation expense of $4 million in the 2002 quarter and $15.6 million in the 2002 year. (b) Includes pretax charges for stock-based compensation expense of $9.3 million in the 2001 quarter and 14.8 million in the 2001 year, pretax charges for ESOP expense of $876,000 in the 2001 quarter and $2.8 million in the 2001 year and income tax benefits of $8.4 million in the 2001 quarter and $6.6 million in the 2001 year. |
|||
| Sales | $156,101,000 | $145,757,000 | 7.1% |
| Operating income | 18,630,000 | 17,244,000 | 8.0% |
| Net income | (a)6,342,000 | (b)(3,601,000) | — |
| Year ended 12/28 | 2002 | 2001 | Change |
| Sales | $670,390,000 | $612,995,000 | 9.4% |
| Operating income | 81,681,000 | 62,483,000 | 30.7% |
| Net income | (a)24,375,000 | (b)(1,132,000) | — |
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