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Select Comfort third-quarter profit up sharply to $6.9 million

Sales dip 6%, but same-store sales rise 9%

Jay McIntosh -- Furniture Today, October 23, 2009

MINNEAPOLIS - Select Comfort's third-quarter earnings rose sharply to $6.9 million from $1 million a year earlier, despite a 6% decline in sales to $147.5 million.

The company has closed 14% of its stores in the past year, and said same-store sales at the remaining units climbed 9%.

"Third-quarter results improved significantly as our focus on controlling costs, building our brand for improved sales, and preserving cash helped mitigate the impact of ongoing market volatility," said Bill McLaughlin, president and CEO.

He said market conditions remain uncertain, so the company will continue to manage conservatively "while prepared to capitalize on growth as we see opportunities."

The latest quarter's earnings amounted to 15 cents per share, compared with 2 cents per share a year ago. The just-ended quarter included a one-time charge of $3.3 million or 5 cents per share associated with terminated financing activities.

Select Comfort said it closed 14 stores in the quarter and 65 in the year to date, and plans to exit another six by the end of the year.

For the first nine months of 2009, sales of $407.7 million were down 14.6% from a year earlier. The profitable third quarter pushed the company past the break-even point for the year to date, to a net income of $243,000 or 1 cent per share. In the first nine months of 2008, it had lost $12.7 million, or 29 cents per share.

Looking ahead, Select Comfort said it expects earnings for the full year 2009 to be 2 cents to 8 cents per share - a wide range because of the volatility of economic trends and the state of the company's turnaround, officials said.

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