Select Comfort earnings up 50%
Staff Staff -- Furniture Today, July 30, 2012
MINNEAPOLIS - Powered by a 25% increase in comparable-store sales at its company-owned stores, mattress manufacturer and retailer Select Comfort reported record second-quarter sales and said profits jumped more than 50%.
The company, maker of the Sleep Number airbed, also said that for stores open at least a year, the average sales per store for the past 12 months topped $2 million for the first time.
The company said sales for the quarter ended June 30 were $205.2 million, a 27.1% increase from last year's second quarter. Net income was $17 million or 30 cents per share, compared with $11.3 million or 20 cents per share in the same period last year.
The earnings were well above analysts' estimates of about 27 cents per share, and Select Comfort's stock rose more than 25% the day following the earnings announcement.
"Delivering record sales, record operating margin and record earnings per share in a more challenged consumer environment is the direct result of our customer-centric strategies and unique business model," said Shelly Ibach, president and CEO. "Specifically, we executed well against our integrated growth formula designed to increase brand awareness, grow exclusive distribution, and advance proprietary product offerings that provide meaningful benefits for our customers."
The company was especially aggressive with its advertising efforts during the quarter, boosting media spending by 37% to $27 million.
The increases in sales and profits were similar for the first six months of the year.
Six-month sales totaled $467.6 million - up 31.9% from the first half of 2011 - while net income was up 41.3% to $39.4 million or 69 cents per share.
The company didn't disclose six-month comparable-store sales figures, but said its store count would be 408 to 412 by the end of the year. At the end of 2011, there were 381 stores, all of them company-owned.
"Going forward, we will continue to innovate across our end-to-end customer experience to further differentiate the Sleep Number brand as we advance towards our goal of exceeding $1.5 billion in revenue and 15% operating margin by 2015," said Ibach.
Select Comfort also boosted its earnings guidance for the year to a range of $1.35 to $1.41 per share. That's up from an April estimate of $1.32 to $1.40 per share.
The company earned $1.07 per share in 2011.
Earnings per share are fully diluted, and all figures in parentheses are losses or declines.
Quarter ended 6/30
Earnings per share
6 months ended 6/30
Net income (a)
Earnings per share
(a) Includes one-time charge of $5.6 million for CEO transition costs in 2012.
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