Sealy Posts Net Income of $5.7 Million in First Quarter

March 30, 2010  by in UnCategorized   

By Home Furnishings Business in Bedding on March 31, 2010

Bedding major Sealy Corp. (NYSE: ZZ) reported net income of $5.7 million for the first quarter ended Feb. 28, compared to $4.3 million posted in the first quarter of last year.

Net sales for the first quarter were $339.6 million, a 9.6 percent increase compared to the nearly $310 million in the first quarter of last year. Gross margin increased 331 basis points to 41.3 percent from the prior year quarter, driven by a 202 basis point gain in the company's U.S. market.

"We are very pleased with our first quarter 2010 results, as we delivered top line growth, driven by both unit growth and average unit selling price growth," said Larry Rogers, president and chief executive officer. "These results represent our second consecutive quarter of year-over-year sales growth. We continue to reap benefits from the successful rollout last year of our innovative Stearns & Foster line. We had a strong showing at the Las Vegas Market in February, where we continued our focus on new products, introducing a new Sealy promotional line, the Embody specialty line and select Posturepedic mattresses to commemorate Posturepedic's 60th anniversary."

Total U.S. net sales increased 4.9 percent to $246.4 million from the first quarter of fiscal 2009. Wholesale domestic net sales, which exclude third party sales from Sealy's component plants, grew 4.6 percent to $241.6 million compared to the first quarter of fiscal 2009.

International net sales increased $18 million, or 24 percent, from the first quarter of 2009 to $93.3 million. Excluding the effects of currency fluctuation, International net sales increased 11.9 percent from the first quarter of 2009.

"We are encouraged by the stabilization we have seen in retail demand across our business segments and with the signs of stability in both the macro-economic and consumer credit market environments," Rogers said. "We continue to believe our product innovation and operational improvements have put the company in a strong strategic position to accelerate gains in profitable market share and drive increasing value for our shareholders."

To read the entire earnings report, click here.