US firm Tempur Sealy posts net sales of $1,208.1 mn in Q1 FY23

Gross margin for the first quarter of FY23 was 41.4 per cent, lower than the 42.2 per cent reported in the first quarter of FY22. Adjusted gross margin was 41.8 per cent in Q1 FY23. Operating income decreased by 24 per cent to $143.3 million, compared to $188.6 million in Q1 FY22, and adjusted operating income was $153.4 million in Q1 FY23, the company said in a press release.

Net income for Q1 FY23 was down 34.7 per cent at $85.3 million, compared to $130.7 million in the first quarter of FY22. Adjusted net income was $92.9 million in Q1 FY23. Earnings per diluted share (EPS) decreased 30.4 per cent to $0.48 as compared to $0.69 in Q1 FY22. Adjusted EPS was $0.53 in Q1 FY23.

In North America, net sales decreased 1.3 per cent year-on-year (YoY) to $919.6 million in Q1 FY23, with a gross margin of 37.4 per cent compared to 37.8 per cent in Q1 FY22. Adjusted gross margin was 37.9 per cent in Q1 FY23, while operating margin was 14.8 per cent, compared to 16.7 per cent in Q1 FY22. Adjusted operating margin was 15.3 per cent in Q1 FY23. North America net sales through the wholesale channel decreased 0.9 per cent to $804.3 million, and net sales through the direct channel decreased 4 per cent to $115.3 million.

Internationally, net sales decreased 6.4 per cent YoY to $288.5 million in Q1 FY23, with a gross margin of 54 per cent compared to 55.3 per cent in Q1 FY22. Operating margin was 15.3 per cent, compared to 21.7 per cent in Q1 FY22. On a constant currency basis, international net sales increased 1.7 per cent compared to Q1 FY22. International net sales through the wholesale channel decreased 4 per cent YoY to $108.3 million, and net sales through the direct channel decreased 7.7 per cent YoY to $180.2 million, the release added.

For FY23, the company expects adjusted EPS in the range of $2.60 to $2.80. This contemplates the company's current sales outlook for mid-single digit YoY growth.

Company chairman and CEO Scott Thompson said: "Our first quarter performance reflects the strength of our industry-leading business model, as we continued to outperform the broader industry against a challenging operating backdrop. Though the US industry conditions were slightly less favourable than anticipated as a result of heightened macroeconomic pressures, we performed largely in-line with our first quarter expectations.

“In the second quarter, our expectation is that our consolidated sales will return to growth year over year, supported by the strong reception to our newly launched products, encouraging order trends quarter to date, and fully lapping the challenging prior year comps in the first quarter.”

Fibre2Fashion News Desk (DP)