Daily News Archive
Brought to you by Home Furnishings Business
September 27,
2012 by in UnCategorized 
By Home Furnishings Business in High Point on September 28, 2012
Inada Massage Chairs has leased a permanent showroom in Showplace for the Oct. 13-18 High Point Furniture Market.
The company, the exclusive U.S. distributor for the Inada line of high-end therapeutic massage chairs produced by Family Inada in Japan, will show in a 2,000-square-foot showroom in Space 5300. The Boulder, Colo.-based company has exhibited on an occasional basis in the High Point Plaza Hotel and other locations, but this marks its first permanent High Point showroom. Its lease runs until 2016.
Weve been growing rapidly over the past few years, but much of that growth has been in the West, said Cliff Levin, CEO. We have an active presence at the Las Vegas Market, which helps us stay in touch with Western retailers, and a well-established base of national back-specialty chains, but we realized there was a broad swath of retailers in the East that we havent been reaching. The High Point Market provides a strong platform for communicating with this new group.
Levin added that Showplace is the perfect match for the Inada brand: Its a beautiful building that is very easy for retailers to work. The mix of products and prices makes it a good fit for us.
At the October market, Inada is focusing its sales effort on the popular Inada Sogno DreamWave massage chair priced at $7,799 retail and other best sellers. The Sognos optical sensors scan the users back and then create a totally customized Shiatsu-type massage. The model offers eight preprogrammed massage sequences as well as manual settings for precise, personalized adjustments.
Inada Massage Chairs currently distributes its line through a mix of contemporary furniture specialists and other independent furniture stores, consumer electronics stores and back specialty stores such as Relax the Back and the Healthy Back Store. It also has some distribution among bedding specialists.
To build demand for its products, Inada advertises in national publications such as the Wall Street Journal, New York Times and Atlantic Monthly, and it also has a regular spot in the SkyMall publication distributed to airline passengers.
We are a niche player, said Levin. We want to work with quality retailers who understand luxury products like ours and how to sell their benefits--elements such as comfort and health. We offer our partners a proven, salable product, with great margin opportunities.
Along with introducing retailers to its current best sellers, Inada also will show the new True Zero Gravity line of recliners from Positive Posture at market, priced at $1,999 to $3,499.
Also featured in the Inada showroom during market will be the Roland Simmons line of floor lamps.
Retailers who place orders on the Positive Posture line--or first movers into the land of True Zero Gravity, as Levin describes them--will receive special market pricing.
We are thrilled that Inada has chosen to step up its High Point presence," said Julie Messner, vice president of leasing for International Market Centers. "They recognize the importance of being part of the worlds leading home furnishings market.
September 27,
2012 by in UnCategorized
By Home Furnishings Business in Mattresses on September 28, 2012
A team of students from Belmont University will enter their mattress recycling program in an international competion.
The students will represent the United States in the upcoming SIFE (Students in Free Enterprise) World Cup, an international competition featuring students who have created businesses in their communities that allow them to acquire skills to become socially responsible leaders. At the World Cup, to be held in Sept. 30-Oct. 2 in Washington, D.C., national champion teams from the United States and 38 other countries will compete for the title.
International Sleep Products Association President Ryan Trainer commended the Belmont team for its participation.
On behalf of the mattress industry, I applaud the Belmont University students for winning the U.S. SIFE competition and now representing the United States at the SIFE World Cup. We wish them the very best, Trainer said. These students have created a sustainable, effective, and market-based business model for recycling used mattresses that ISPA whole heartedly supports. We firmly believe a national mattress recycling program that encourages the growth of businesses like Spring Back will benefit from important economies of scale, as opposed to the inefficiencies and added costs that piecemeal, state-based legislation would create.
The Belmont University team won the U.S. SIFE competition earlier this year with the innovative Spring Back Recycling program that the students developed to recycle used mattresses. Spring Back is both helping the environment and creating jobs. Through the program, previously incarcerated workers are taught the skills they need to gain employment at Spring Backs recycling facility, where mattresses are dismantled and their component materials are recycled for use in new products.
With millions of mattresses sent to landfills each year, where they take up large amounts of space, the need for mattress recycling is great.
When the Belmont students began to plan their program, the mattress industry was pleased to help out with information about the industry, other recyclers and possible markets for the used steel, foam and other recycled materials," Trainer said. "But it was the students commitment, initiative and creativity that has made Spring Back a success, both as a business and in the SIFE competition.
September 26,
2012 by in UnCategorized
By Home Furnishings Business in Acquisition on September 27, 2012
Two of the leading bedding suppliers are getting into bed with one another-Tempur-Pedic (NYSE: TPX) and Sealy (NYSE: ZZ) are merging.
The companies say the acquisition of Sealy by Tempur-Pedic will create a $2.7 billion bedding company.
The transaction has been approved by the companies' boards of directors. Stockholders with about 51 percent of Sealy's outstanding common stock have consented to the deal.
During a conference call to discuss the deal this morning, Sarvary emphasized the current business plan for the deal, which should close by early next year, calls for two companies maintaining separate consumer-facing presences.
"The companies have different ways of going to market," he said. "It's the back end where we'll do the sharing. ... Leveraging each other's product development."
Tempur-Pedic remains committed to growing its specialty sleep products, while Sealy will look to keep building its more traditional mattress portfolio.
Rogers noted the transaction will benefit both brands' global business plans--the two have a presence in more than 80 countries.
"The global footprint we both share ... is one of our focuses going forward," he said. "We think it gives both companies access to more international (business)."
Sarvary pointed out the brands' respective global presence will help the other fill gaps.
"By continent, we overlap, but country by country, there are places we can help each other," he said.
There are no current plans to offer increased equity to help finance the transaction, as management is confident Tempur-Pedic's and Sealy's cash flows are strong enough to reduce debt to equity from four times to one-and-a-half to two times within four to five years.
Under the deal, Tempur-Pedic will acquire all of the outstanding common stock of Sealy for $2.20 per share, representing a premium of approximately 23 percent to Sealy's 30-day average closing price Wednesday. In addition, Tempur-Pedic will assume or repay all of Sealy's outstanding convertible and non-convertible debt, for a total transaction value of approximately $1.3 billion. The transaction, which is subject to customary closing conditions, including regulatory approvals, is expected to close during the first half of 2013.
"This is a transformational deal that brings together two great companies, each with globally recognized brands," said Mark Sarvary, Tempur-Pedic CEO. "Tempur-Pedic and Sealy together will have products for almost every consumer preference and price point, distribution through all key channels, in-house expertise on most key bedding technologies, and a world-class research and development team. In addition, our global footprint will span over 80 countries. The shared know-how and improved efficiencies of the combined company will result in tremendous value for our consumers, retailers and shareholders."
Tempur-Pedic and Sealy will operate independently. Larry Rogers, Sealy CEO, who has been with the company for 33 years, will remain CEO of Sealy and will report to Sarvary.
"The complementary product and market fit of these two companies deliver a unique opportunity to create the first full spectrum, global bedding company that addresses all market segments and consumer preferences," Rogers said. "Together, we believe that we can deliver more value than either business could on its own by leveraging our strong combined assets."
September 26,
2012 by in UnCategorized
By Home Furnishings Business in Financial Reports on September 27, 2012
Bassett Furniture Inds. (NASDAQ: BSET) reported third-quarter 2012 sales of $64.4 million, an 8.5 percent increase over the prior-year period.
Bassett, Bassett, Va., recorded net income of $2.4 million, or $0.21 per diluted share, for the three months ended August 25, compared with $0.4 million or $0.04 per diluted share in the third quarter of 2011. Company-owned store delivered sales increased 22.5 percent to $41.2 million with a 9.9 percent increase from the 43 comparable stores.
Third-quarter 2012 operating income improved to $0.8 million from a loss of $0.2 million in the prior-year period, driven primarily by higher sales in both the wholesale and retail segments. This was offset by higher selling, general and administrative expenses due primarily to the increased number of company-owned stores. The company also recorded a tax benefit of $1.9 million primarily as a result of favorable provision to return adjustments related to its 2011 Federal income tax return and the release of a portion of the valuation allowance against certain deferred tax assets.
"The achievement of solid growth in both our wholesale and retail segments in our fiscal third quarter was encouraging," said Robert H. Spilman Jr. president and CEO. "New product introductions, comparable corporate retail sales gains, and greater penetration with open market independent retailers contributed to the 8.5 percent consolidated revenue growth that the company generated during the period. Returning from the traditional July 4 shut down of our manufacturing facilities, production schedules compared favorably to those of the past few years. And, of course, we were very pleased to post a 9.9 percent increase in our comparable corporate store sales. Despite continuing up front expense associated with the pending launch of our partnership with the HGTV television network, we returned to operating profitability for the quarter after posting a small operating loss for the same quarter last year.
"After 18 months of planning and preparation, we look forward to finally realizing the benefits we expect from our partnership with HGTV. The in-store design centers in our Bassett Home Furnishings network have been co-branded with HGTV to more forcefully market the concept of a 'home makeover,' an important point of differentiation for our stores that also mirrors much of the programming content on the HGTV network. In addition, new HGTV Home branded furniture will hit independent retailers' floors during the fourth quarter. As we move into what has generally been a stronger selling season for our industry, we believe this partnership will drive additional sales."
Net sales for the wholesale segment were $44.8 million for the third quarter of 2012, compared with $41.9 million for the third quarter of 2011, an increase of 6.9 percent. The upholstery and wood divisions had third-quarter sales gains of 8 percent and 3 percent, respectively.
"Wholesale operating income increased 11 percent to $1.7 million," Spilman said. "Although operating with three fewer stores than one year ago, we increased wholesale shipments to our BHF store network this quarter. Also contributing to our growth was the favorable reception of our new product introductions from the High Point Market that turned into shipments in July and August. We have also added several new wholesale sales representatives to continue to present our programs to independent furniture retailers and designers in areas that do not conflict with our dedicated store network."
The 22.5 percent increase in company-owned stores was comprised of a $3.2 million, or 9.9 percent, increase in comparable store sales along with a $4.4 million increase in non-comparable store sales. While the company does not recognize sales until goods are delivered to the customer, management tracks written sales (the dollar value of sales orders taken, rather than delivered) as a key store performance indicator. Written sales for comparable stores increased by 13 percent for the third quarter of 2012 as compared with the third quarter of 2011.
Operating loss for the company-owned stores improved to a loss of $1.5 million in the third quarter of 2012 as compared to a loss of $1.8 million for the third quarter of 2011 which was primarily driven by the sales increases noted above.
"Corporate retail losses decreased by 15 percent for the quarter and by 38 percent for the fiscal year to date," said Spilman. "The quarter was characterized by an abnormal amount of product clearance sales, which carry a lower margin, due to the large amount of new products that hit our showroom floors in July and August. Our corporate retail associates and our licensee partners spent a tremendous amount of effort over the summer to convert our in-store design centers to the HGTV Design Studio at Bassett that officially debuted over Labor Day weekend. Our marketing efforts and our design associates are the impetus that has allowed us to continue to increase our sales and to improve our year over year corporate retail results for six consecutive quarters. We believe that our new national television campaign on the HGTV network and the momentum that our retail division currently enjoys gives us the ability to continue to increase our market share and to further improve our results as the overall economy strengthens."
September 26,
2012 by in UnCategorized
By Home Furnishings Business in Financial Reports on September 27, 2012
Bedding major Sealy Corp. (NYSE: ZZ) reported third-quarter 2012 sales of $365 million, a 9.4% increase over the prior-year period.
Total U.S. net sales increased 11.2 percent to $286.2 million from the third quarter of fiscal 2011. International net sales increased $2.5 million, or 3.2 percent, from the third quarter of fiscal 2011 to $79.2 million. This increase was primarily due to increased sales in Mexico and Argentina partially offset by lower sales in Canada. In Canada, local currency sales increases of 1.2 percent translated into decreases of 3.2 percent in U.S. dollars due to a weaker Canadian dollar. Local currency sales performance in Canada was driven by a 3.8 percent increase in average unit selling price, offset by a 2.5 percent decrease in unit volume.
Income from operations for the third quarter of fiscal 2012 decreased 13.8 percent, or $5.2 million, to $32.6 million. This year's results included $6.6 million of higher national advertising costs, which primarily related to the rollout of our Optimum by Sealy Posturepedic line as well as higher compensation related expense.
Net income from continuing operations for the third quarter was $0.1 million.
Net sales for the nine months ended August 26 increased 3 percent to $989.8 million from $960.9 million for the comparable period a year earlier. Net income from continuing operations was $4.5 million, versus net income from continuing operations of $8.4 million in the prior-year period.
During the fourth quarter of 2010, the company divested the assets of its manufacturing operations in France and Italy, which represented all of the assets in its Europe segment. In addition, the company discontinued manufacturing operations in Brazil. The company has transitioned to a license arrangement with third parties in both of these markets. These businesses are accounted for as discontinued operations, and accordingly, the company has reclassified its financial data for all periods presented to reflect these actions. Unless otherwise noted, the reported financial data pertains to Sealy's continuing operations.
Sealy, Trinity, N.C., had planned to host a conference call this afternoon to discuss third-quarter results, but cancelled that call due to the transaction announcement with Tempur-Pedic International.