Sealy Posts Year-End, 4Q Profit and Sales Gains

February 20, 2007  by in UnCategorized   

By Home Furnishings Business in Bedding on February 2007 Bedding major Sealy Corp. reported net sales for the fourth quarter ended Nov. 26 increased 8.4 percent to $395.3 million from $364.6 million during the same quarter last year.

Net income for the quarter was $21.5 million compared to $15.2 million for the comparable period last year. The fourth quarter results included incremental pre-tax expenses of $5.9 million related to the introduction of new product.

Net sales for the fiscal year increased 7.7 percent to nearly $1.6 billion from $1.5 billion for the previous year. Net income for the year was $74 million compared to $68.5 million for the previous fiscal year.

The results include $34.2 million of charges related to the company’s IPO and associated debt extinguishments, $26.7 million of incremental cost related to the launch of Sealy’s new products and $2.6 million of incremental expense for non-cash compensation versus the comparable prior year, partially offset by a reduction in charges of $5.7 million due to changes in estimates underlying the reserves for workers’ compensation claims.

“I am pleased with our achievements in 2006, including over 20 percent growth in our international markets, near doubling of our specialty business, an improving trend in domestic unit shipments, and ongoing strengthening in promotional mattresses, a segment where we were historically underrepresented,” said David McIlquham, chairman and chief executive officer. “We accomplished these in light of a challenging industry and competitive environment during a year in which we also completed the biggest product transition in the company’s history.”

In addition to its earnings release, the company also announced a share repurchase program under which the board of directors has given approval for Sealy to repurchase up to $100 million of its common stock.

Under the plan, Sealy may purchase common stock from time to time in the open market or in negotiated block purchases. As of Nov. 27, the company had 90,983,041 shares of common stock outstanding.

Sealy will host a conference call and audio webcast today at 5 p.m. Eastern time. The live call can be accessed by dialing (800) 811-0667, or for international callers, (913) 981-4901. Additionally, a live audio webcast will be available to interested parties at sealy.com under the Investor Relations section.