| BRIEFLY | |
| Tempur-Pedic in 2012 | |
| Net sales | $1.402 billion |
| Net income | $106.8 million |
| Operating income | $248.3 million |
| Gross profit margin | 50.9% |
| Gross profit | $131.6 million |
Tempur-Pedic, a Lexington, Ky.-based specialty sleep major, reported net sales for fiscal year 2012 decreased 1% to $1.402 billion from $1.417 billion in 2011.
Net sales in the North American segment decreased 4%; net sales in the international segment were up 6%.
Tempur-Pedic reported net income of $106.8 million for 2012, compared with $219.6 million for the prior year. Gross profit margin was 50.9% for 2012, compared with 52.4% for 2011. The company attributed the decline to product mix and increased promotions and discounts.
Operating income for the fiscal year was $248.3 million, or 18% of sales, compared with $340.5 million, or 24% of sales for 2011. Operating income for 2012 included $11.1 million of transaction and integration costs related to the proposed acquisition of mattress major Sealy, $1.5 million of restructuring charges and $10.3 million of benefit related to an adjustment to long-term incentive stock compensation following a re-evaluation of the probability of meeting certain required financial metrics.
Turning to the fourth quarter of 2012, Tempur-Pedic reported net income of $23.5 million. Net sales decreased 7% to $341.1 million in the fourth quarter from $366.8 million in the prior-year quarter.
Net sales in the North American segment decreased 9% and fell 4% in the international segment.
Mattress sales decreased 5% globally in the fourth quarter, falling 5% in North America and declining 7% in the international segment. Pillow sales decreased 8% globally, falling 26% in North America, but increasing 11% internationally.
Gross profit margin in the fourth quarter was 50%, compared with 52.1% in the prior-year quarter. The attributed the decline to product mix and higher new product costs, partially offset by improved efficiencies in manufacturing and distribution.
Operating income was $51.3 million, or 15% of sales, as compared with $85.8 million, or 23.4% of sales in the fourth quarter of 2011. Fourth-quarter operating income included $7.6 million of transaction and integration costs related to the proposed Sealy acquisition, as well as $1.5 million of restructuring charges.
“Our performance during the fourth quarter was in line with our projections, both in North America and internationally,” said Mark Sarvary, Tempur-Pedic chief executive officer. “We continued to see signs of stabilization in our North American business driven by initiatives we launched in the third quarter. Internationally, our fourth-quarter results were consistent with our recent projections, but reflect a softening in demand due to macroeconomic weakness in Europe as expected. We remain very confident in our company’s growth potential and our strong brand and are very excited about our proposed combination with Sealy.”
