Specialty bedding manufacturer Tempur-Pedic commented June 6 on its year-to-date performance in the second quarter and updated its financial guidance for 2012.
The Lexington, Ky.-based company doesn’t ordinarily provide quarterly guidance, but announced that second-quarter sales in North America have been below expectations to date. Tempur-Pedic said it expects net sales for the second quarter ending June 30 to be 3% to 5% below the second quarter of 2011, driven by an expected 8% year-over-year decline.
With lower-than-planned sales and associated deleverage, the company said it expects second-quarter diluted earnings per share to decrease approximately 50% from the second quarter of 2011.
The company expects full-year net sales to be approximately $1.43 billion and full-year earnings per diluted share to be approximately $2.70.
“In light of the current environment for North American sales, our guidance assumes that North American sales for the third and fourth quarters will each be approximately equal to the second quarter sales, factoring in modest seasonality,” said Dale Williams, chief financial officer of the Lexington, Ky.-based company. “Our international business continues to perform well and we have made no substantive changes to our expectations for international sales.”
Chief Executive Officer Mark Sarvary said, “Sales trends in our North America business during the second quarter have been disappointing and below plan, primarily due to changes in the competitive environment, including an unprecedented number of new competitive product introductions, which have been supported by aggressive marketing and promotion. As a result, we are projecting lower sales than previously anticipated for the rest of the year and are taking actions to realign our expense structure appropriately. However, we remain very confident in our company’s growth potential and our strong brand, and as a result remain committed to our long-term strategic plan.”
The Associated Press reported on June 8 that Tempur-Pedic shares, which had dropped 49% in two days after the company cut its earnings forecast, rose 8% after the company said it is actively repurchasing shares under its previously announced plan.
