Acquisitions, store openings send Mattress Firm sales soaring 45.6%
Larry Thomas -- Furniture Today, September 7, 2012
HOUSTON — Acquisitions and new store openings powered bedding retailer Mattress Firm to a 45.6% sales gain in the quarter ended July 31.
The company, which completed its acquisition of the 181-store Mattress Giant chain on May 2, reported a 5% same-store sales gain. It also opened 27 new stores during the quarter.
Total sales for the quarter were $262 million, up from $179.9 million in the same quarter last year.
Of the $82.1 million in increased sales, Mattress Firm said $31.9 million of the total came from new stores and $43.4 million from acquired stores.
The retailer ended the quarter with 957 company-owned locations.
Net income, including acquisition costs of $5.9 million, totaled $10.1 million or 30 cents per share. In the same quarter last year, net income was to $3.6 million or 16 cents per share, a figure that included a $1.87 million loss from debt retirement.
"Our performance demonstrates the tremendous capacity of this organization as we successfully integrated and absorbed levels of growth unprecedented in this industry in such a compressed timeframe, while achieving record sales and profitability during the same period," said Steve Stagner, president and CEO. "By accomplishing this, it reaffirms that our core strategy of further penetrating our existing markets concurrently with expanding into new markets is driving market share and profitability."
The company also announced that it is acquiring retailer Mattress X-Press, which has 35 stores in south Florida and Georgia. It expects to close that transaction by the end of its third fiscal quarter on Oct. 30.
For the six months ended July 31, Mattress Firm had sales of $471.8 million, an increase of 42.2% from $331.8 million in the first six months of the previous fiscal year.
Six-month net income totaled $19.8 million or 59 cents per share. That's up from $4.67 million or 21 cents per share in the comparable period last year.
Because of the pending acquisition of Mattress X-Press, Mattress Firm increased its sales projection for the fiscal year, but slightly lowered earnings per share estimates.
Sales are now projected to be $1.022 billion to $1.039 billion - up from an earlier range of $1.02 billion to $1.03 billion.
The new earnings projection is $1.47 to $1.50 per share. That's down from its previous forecast of $1.48 to $1.52 per share. The company said acquisition-related costs will reduce earnings by 3 to 4 cents per share.