Tempur-Pedic's profit nearly doubles as sales jump 42%
Second-quarter sales also topped 2008 period
Larry Thomas -- Furniture Today, July 21, 2010
LEXINGTON, Ky. — Bedding manufacturer Tempur-Pedic said second-quarter profits were nearly double last year's second quarter, as sales leaped more than 42%.
The specialty sleep producer, which specializes in visco-elastic foam mattresses and pillows, also recorded a hefty increase in gross margin for the quarter and raised its sales and earnings guidance for 2010.
"We are very pleased with the continued substantial growth in our North American business and we are also pleased with the improved performance of our international business, particularly on a local currency basis," said CEO Mark Sarvary. "Our focus on improving gross margins and operating costs continues to be effective."
Worldwide sales for the quarter totaled $263 million, up 42.1% from $185.2 million in the second quarter of 2009. Sales in the latest quarter were also above the second quarter of 2008, when the company had worldwide sales of $238.7 million.
Net income totaled $33.5 million or 46 cents per share. That compares with $16.9 million or 22 cents per share in last year's second quarter. It was also ahead of the second quarter of 2008, when net income was $20.2 million or 27 cents per share.
Tempur-Pedic's gross margin was 48.7%, an increase of 2.1 percentage points from last year's second quarter.
The company's North American mattress business was especially strong as sales leaped 58.4% to $136.7 million.
"Although the macroeconomic environment is still uncertain, we remain confident of the potential to significantly grow sales and earnings over the coming years," Sarvary said. "We will continue to invest in initiatives that will drive growth over the long term."
For the first six months of 2010, worldwide sales were $516.9 million, an increase of 42.7% from the first six months of last year.
First-half net income totaled $66.7 million or 90 cents per share. That compares with $30.2 million or 40 cents per share in the first half of 2009.
Tempur-Pedic said it expects sales in 2010 to be $1.06 billion to $1.1 billion. That's up from an April projection of $1.02 billion to $1.06 billion.
The company is projecting earnings of $1.85 to $2 per share, up from the April projection of $1.70 to $1.85 per share.
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