Sealy sales decline 9.3% in third quarter

Profit falls 49% to $10.9 million

Larry Thomas -- Furniture Today, October 8, 2008

ARCHDALE, N.C. — Buffeted once again by weak retail demand, bedding major Sealy said third-quarter sales were 9.3% below last year's third quarter.

Profits, meanwhile, tumbled 49%, despite reductions in several fixed and variable expenses.

Total sales for the quarter ended Aug. 31 were $405 million, compared with $446.4 million in the same period last year. Domestic sales, which don't include third-party sales from Sealy's component plants, were off 12.3%.

International sales fell 2.2%, including currency fluctuation.

Larry Rogers, president and CEO, said domestic unit volume was down 15.5%. But he said the company's new Posturepedic and Smart Latex lines performed well.

"We completed the rollout of our new Posturepedic line during the quarter, which continued to gain traction and was a key driver of our results," Rogers said. "The improvement in our sales of this product line above the $1,000 price point is helping us gain share in this key portion of the market."

Net income for the quarter was $10.9 million or 12 cents per share, including restructuring charges of $2.5 million. In last year's third quarter, net income was $21.5 million or 22 cents per share.

For the nine months ended Aug. 31, sales fell 7% to $1.2 billion and net income was down 37.2% to $39.1 million or 42 cents per share.