Tempur Sealy Q1 diluted EPS skyrockets 120%

02 May '14

2 min read

Tempur Sealy International, Inc., the world's largest bedding provider, announced financial results for the first quarter ending March 31, 2014. The Company also announced it has signed a definitive agreement to acquire the Sealy brand rights in Continental Europe (excluding UK) from its former licensee. The Company confirmed financial guidance for 2014.

First Quarter Financial Summary

Earnings per diluted share ("EPS") under U.S. generally accepted accounting principles ("GAAP") in the first quarter of 2014 were $0.44 compared to GAAP EPS of $0.20 in the first quarter of 2013. The 2013 and 2014 results reflect transaction and integration costs related to the acquisition of Sealy Corporation ("Sealy"). The Company completed its acquisition of Sealy in March 2013, and results for the first quarter of 2013 include Sealy's operations from March 18, 2013 through March 31, 2013.

Adjusted EPS were $0.53 in the first quarter of 2014 as compared to adjusted EPS of $0.62 in the first quarter of 2013.

GAAP net income in the first quarter of 2014 was $27.4 million as compared to GAAP net income of $12.5 million for the first quarter of 2013. The Company reported adjusted net income of $32.6 million for the first quarter of 2014 as compared to adjusted net income of $38.2 million for the first quarter of 2013. For additional information regarding adjusted EPS and adjusted net income (which are non-GAAP measures), please refer to the reconciliations and other information included in the attached schedules.

Total net sales increased 79.9% to $701.9 million in the first quarter of 2014 from $390.1 million in the first quarter of 2013. The net sales increase was due to a full quarter of Sealy net sales in the first quarter of 2014 of $363.2 million as compared to $46.7 million in the first quarter of 2013, which included the period of March 18, 2013 through March 31, 2013.

Gross profit margin was 38.4% as compared to 48.3% in the first quarter of 2013. The gross profit margin decreased primarily as a result of the inclusion of a full quarter for the Sealy business, which has lower margins than the Tempur North America and Tempur International segments, as well as changes in product and channel mix and higher new product launch costs, offset partially by geographic mix and lower sourcing costs.

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Tempur Sealy

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