Specialty bedding producer Tempur–Pedic reported net sales increased 33% to $1.105 billion in 2010 from $831.2 million in 2009. Sales in the fourth quarter of the year rose 20% to $292.7 million from $244.8 million in the fourth quarter of 2009.
Looking at full–year results, the Lexington, Ky.–based company reported net sales increased 34% on a constant–currency basis. Net sales in North America increased 47%, while international net sales rose 9%. On a constant–currency basis, international net sales increased 11%.
Earnings per share were $2.16 per diluted share for 2010, up from $1.12 per diluted share in the previous year. Tempur–Pedic reported net income of $157.1 million for 2010, as compared to net income of $85 million in 2009.
Gross profit margin was 50.2% for 2010, compared to 47.4% for 2009. Tempur–Pedic attributed the gain to improved efficiencies in manufacturing and fixed–cost leverage related to higher production volumes, partially offset by higher commodity costs and geographic mix.
Operating profit margin was 22.2% in 2010, compared to 17.4% in 2009. The company generated $184.1 million of operating cash flow in 2010, compared to $135 million in 2009.
“In 2010, we delivered strong financial results and, at the same time, executed well on our strategic growth initiatives. We strengthened the product range and greatly improved how well consumers understand and appreciate the unique benefits of Tempur–Pedic,” said Mark Sarvary, Tempur–Pedic chief executive officer.
Looking at fourth–quarter figures, on a constant–currency basis, net sales increased 21%. Net sales in North America rose 31%, while international net sales increased 1%. On a constant–currency basis, international net sales increased 6%.
Earnings per share were $0.66 per diluted share in the fourth quarter of 2010, as compared to $0.38 per diluted share in fourth–quarter 2009. Tempur–Pedic reported net income of $46.3 million for the fourth quarter, compared to net income of $29.1 million during the same period in 2009.
Mattress sales increased 20% globally—up 32% in the North America and down 1% internationally. On a constant–currency basis, international mattress sales grew 4%. Pillow sales increased 18% globally—up 31% in North America and 8% internationally. On a constant–currency basis, international pillow sales increased 11%.
Gross profit margin was 51.9%, compared to 48.5% in fourth–quarter 2009. Operating profit margin was 24.5%, compared to 19.3% in the fourth quarter in 2009. Tempur–Pedic generated $44.5 million of operating cash flow in fourth–quarter 2010, compared to $14.6 million during the same period in 2009.
For 2011, Tempur–Pedic expects net sales to range from $1.23 billion to $1.28 billion and expects earnings per share to range from $2.60 to $2.75 per diluted share.
“In 2011, we will implement the next phases of our plan to become the world’s favorite mattress and pillow brand,” Sarvary said. “We will continue to enhance our product range both in the U.S. and internationally, increase our investment in consumer communication and broaden distribution in all geographies.
