From Home Furnishing Business
Mattress Firm Deal Helps Drive 48% Revenue Jump at Steinhoff
Steinhoff International, the South African retail conglomerate that acquired Mattress Firm last year, said revenues shot up 48% to $10.17 billion euros (about $11.45 million) in the six months ended March 31 – the first half of its fiscal year.
The most recent figure included revenue of 1.52 billion euros (about $1.71 billion) from Mattress Firm for the six-month period, a figure Steinhoff said was negatively impacted by the removal of Tempur-Sealy International products from Mattress Firm stores and the conversion of more than 1,300 Sleepy’s stores to Mattress Firm.
Steinhoff didn’t disclose Mattress Firm revenues for the comparable period because the acquisition didn’t close until Sept. 30.
In a report to shareholders, Steinhoff said the termination of the Tempur-Sealy supply agreement and the rebranding of Sleepy’s stores caused only a short-term disruption, noting that its financial statements included a one-time charge of 48 million euros (about $54.1 million) for the rebranding. The rebranding was completed at the end of March, Steinhoff said.
Same-store sales at Mattress Firm were down 5.9%.
“Supply of Tempur-Sealy products stopped in early April, and Mattress Firm is in the process of replacing then with new innovative merchandise from other leading brands, largely Serta Simmons,” the report read. “The new positioning will enhance Mattress Firm’s customer offering and attract a wider customer base focused on value and innovative new products.”
The Mattress Firm purchase was the largest of four acquisitions completed by Steinhoff during the first half of its fiscal year.
Steinhoff recently announced it intends to acquire a majority stake in U.S. mattress producer Sherwood Bedding, but Sherwood’s results were not included in the most recent report because that deal isn’t expected to close until July.