Mattress Firm sales top $1 billion in 2012

BRIEFLY
Fourth quarter snapshot
Net sales $258.2 million
Net income $7.6 million
Earnings per share $0.22
Full year results
Net sales $1,007.3 million
Net income $39.9 million
Earnings per share $1.18

Mattress Firm Holding Corp., the parent of Houston-based bedding retailer Mattress Firm, has reported its fourth quarter, ending Jan. 29, and full fiscal year results for 2012. Full-year net sales were $1,007.3 million, an increase of 43.1% over the prior year, and comparable-store sales increased 6.1%. Net sales for the fourth quarter were $258.2 million, a 37% increase over the same quarter of 2011. The fourth-quarter increase reflected incremental sales from new and acquired stores, offset by a comparable-store sales decline of 1.6%, the company said.

Net income for fiscal 2012 was $39.9 million and generally accepted accounting principle earnings per share were $1.18. Adjusted net income for 2012 was $50.4 million and earnings per share was $1.49—excluding net of income taxes, acquisition-related costs, secondary offering costs, impairment charges and other costs.

Net income for the fourth quarter was $7.6 million and GAAP earnings per share were $0.22. Excluding $2.4 million net of income taxes, acquisition-related costs, impairment charges and other costs, net income for the fourth quarter was $10 million and adjusted EPS was $0.30—a 43% increase over the prior-year quarter.

Income from operations in fiscal 2012 was $78.7 million. As of Jan. 29, the company had $21 million of borrowings under the revolving portion of its 2012 senior credit facility, approximately $1.4 million in outstanding letters of credit, with additional borrowing capacity of $77.6 million.

Income from operations in the fourth quarter of 2012 was $17.2 million. Adjusted income from operations was $21.5 million, a 37% increased over the prior-year quarter. Adjusted operating margin for the fourth quarter remained unchanged over the prior-year quarter at 8.3% of net sales.

In December 2012, the company acquired 27 Mattress Source stores in North and South Carolina for $11.4 million. Mattress Firm expects to complete the rebranding of those stores during the first half of fiscal 2013. The company reported it completed the rebranding of the former Mattress Giant stores acquired in 2011 and 2012 during the fourth quarter of fiscal 2012. Total store count at the close of fiscal 2012 was 1,057.

“We achieved significant growth in 2012, unprecedented in our industry, as we drove net sales by 43.1% to above the $1 billion mark and increased our store base by 45% to over 1,000 store units,” said Steve Stagner, Mattress Firm president and chief executive officer. “We also delivered meaningful year-over-year increases across key financial metrics, including a 50.6% increase in adjusted operating income and 6.1% comparable-store sales growth during out first full year as a public company. Overall, fiscal 2012 was a record year for Mattress Firm—an impressive accomplishment in light of the challenges associated with adding 328 stores, including 242 stores through accretive acquisitions. Looking to 2013, with the integration of the acquired stores substantially complete, we expect to drive sales and operating margin expansion from the ongoing sales growth of acquired stores, which will be enhanced as we pass the anniversary dates of our 2012 acquisitions. We are extremely excited about our potential for fiscal 2013 and believe we are well positioned to drive additional value for our shareholders as we move through the year.”

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