Select Comfort profit jumps 51.5% in 4Q
By Furniture Today Staff -- Furniture Today, February 12, 2006
Minneapolis — Airbed manufacturer and retailer Select Comfort kept bounding ahead in 2005, with sales jumping 23.9% from the previous year to $691.1 million and earnings rising 38.7% to $43.8 million, the company said.
Fourth-quarter gains were even stronger, with sales climbing 26.4% to $187.9 million and earnings up 51.5% to $15.8 million from the comparable period a year earlier.
Select Comfort said its stores posted same-store sales growth of 18% in the fourth quarter and 15% for the year. The company added 40 stores in 2005, giving it 396 at year's end, and began selling at an additional 219 stores at partner retailers, for a total of 308.
Revenue through e-commerce sales rose 23% in the quarter and 25% for the year.
"We have now sustained a five-year annual compound revenue growth rate of more than 20% through 2005 and have increased operating margins by three percentage points over the past three years," said Chairman and CEO Bill McLaughlin. Operating profit was 13.1% of revenue in the fourth quarter, up from 10.9% a year earlier, the company said.
Select Comfort's balance sheet remained debt-free, with cash and investments at year's end totaling $112.1 million. The company also said it spent $49.7 million during the year to buy back some 2.4 million shares of its stock, nearly 7% of the outstanding shares.
For 2006, the company is projecting revenue growth at the high end of its long-term range of 15% to 20%, and is looking to exceed its long-term earnings growth rate of 20% to 25%. It expects earnings per share of $1.30 to $1.37, compared with $1.14 in 2005. Same-store sales growth is projected at 7% to 12%.
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