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From Home Furnishing Business

Smart Bed Drives Q4 Sales, Earnings Growth at Sleep Number

Buoyed by the success of its new smart bed, mattress manufacturer and retailer Sleep Number (NASDAQ: SNBR) reported double-digit sales and earnings increases in the fourth quarter.

The company, which generates the vast majority of its sales from company-owned retail stores, said sales in the quarter ended Dec. 30 rose 15.9% to $363.3 million, while net income was up 40% to $15.8 million or 39 cents per share.

The bottom line included a gain of 6 cents per share for tax benefits from the Tax Cuts and Jobs Act that was signed into law in late December.

“Our consumer innovation strategy delivered market share growth and accelerated returns in 2017,” said Shelly Ibach, president and CEO. “Consumers are embracing the sleep and wellness benefits of our revolutionary Sleep Number 360 smart bed. We look forward to having our full line of smart beds in market by mid-year 2018 and continuing to advance our supply chain initiatives for greater efficiency.”

The fourth quarter included a 12% jump in same-store sales at its retail stores.

For the year ended Dec. 30, sales rose 10.1% to $1.44 billion, a figure that included a 4% same-store gain at its retail stores.

Net income for the full year totaled $65.1 million or $1.55 per share. That was up from $51.4 million or $1.10 per share the previous year.

For 2018, the company is projecting earnings of $1.70 to $2 per share. The company said that forecast assumed sales growth in the mid- to high single-digits and an effective income tax rate of 25%, based on the new tax legislation.



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