Bedding manufacturer Sealy reported that net sales for its fiscal fourth quarter of 2009 were $332.1 million, an increase of 1.9% compared to the same period in 2008.
Operating income for the Trinity, N.C.–based company rose to $19.6 million, an increase of $43.6 million over the same period in 2008, when the company had a net loss of $24 million.
Sealy’s gross profit margin increased 39.5%, up 331 basis points from the same quarter of the prior year. It was driven by gains in the U.S. market.
As a percent of sales, income from operations increased to 5.9% from a loss in the same prior–year period. The company attributed the improvement to better gross profit margin performance and continued cost improvements. In addition, 2008 results included a noncash charge of $27.5 million.
“Our fourth–quarter 2009 sales results represent our first year–over–year increase since fourth–quarter 2007,” said Larry Rogers, Sealy president and chief executive officer. “Our successful rollout of the new Stearns & Foster line reinforced our commitment to developing innovative products and was an important driver in our profitable market share gains and in strengthening our partnerships with our retailers and suppliers.”
In the fourth quarter, total U.S. net sales increased 6.1% to $233 million. Wholesale domestic net sales, which exclude third–party sales from Sealy’s component plants, grew 7.3% to $227.7 million, compared to $212.2 million in the same quarter of 2008. Unit volume increased 7.9%, but the wholesale average unit selling price decreased 0.6%.
U.S. gross profit margin increased 371 basis points to 41.5%. The increase in U.S. gross profit margin was driven primarily by lower material costs and continued improvements in manufacturing efficiencies, but they were partially offset by “unfavorable pricing trends,” the company said.
International net sales totaled $99.1 million, a decrease of $7 million, or 6.6%, over the fourth quarter of 2008. Excluding the effects of currency fluctuation, international net sales reflected an 8.8% decline, due primarily to soft sales in Canada.
For fiscal 2009, Sealy reported that net sales decreased 13.9% to $1.29 billion from $1.498 billion for fiscal 2008. Gross profit was $516.8 million, or 40.1% of net sales, versus $582 million, or 38.9% of net sales. in 2008. Income from operations was $111.1 million, or 8.6% of net sales, compared to $82.5 million, or 5.5% of net sales, for fiscal 2008.
