In its fourth quarter of fiscal 2019, Tempur Sealy International Inc. beat the Zacks Consensus Estimate (Zacks Investment Research) on net sales by 12.4%. The Lexington, Kentucky-based mattress major posted net sales for the quarter of $871.3 million, a 28.9% increase, compared with the fourth quarter of 2018. Its net income grew 275.6% to $46.2 million. Earnings per diluted share increased to $0.84, compared with $0.22 in the fourth quarter of fiscal 2018.
Earnings before interest, tax, depreciation and amortization increased 44.3% to $112.4 million, compared with $77.9 million in the fourth quarter of fiscal 2018.
Gross margin was 44.3%, compared with 41.9% in the prior-year quarter, the company said.
Operating income increased 46.1% to $84.6 million. It included charges of $29.8 million associated with a wholesale customer bankruptcy.
RESULTS
Net sales
$871.3 million
Net income
$46.2 million
Earnings per share
$0.84
Tempur Sealy’s Full Year
Net sales
$3.1 billion
Net income
$189.5 million
Earnings per share
$3.42
In the fourth quarter, net sales in the North America business segment increased 36.3% to $719.2 million. Through the wholesale channel, sales grew 31.6% to $641 million. Net sales through the direct channel grew 93.6% to $78.2 million, driven primarily by growth from company-owned stores, which includes the acquisition of Sleep Outfitters.
Net sales in the international business segment increased 2.4% to $152.1 million, compared with the prior-year quarter. On a constant currency basis, they grew 4%. Through the wholesale channel, net sales decreased 1.2%, to $117.9 million. Through the direct channel, they grew 17%, to $34.2 million.
For the full fiscal year, net sales rose 14.9%, to $3.1 billion. Net income was $189.5 million, compared with $100.5 million for 2018. EBITDA grew 31.5% to $468.4 million and EPS increased to $3.42, compared with $1.82 in 2018.
“The investments we have made over the past four years strengthening the long-term foundation of our company have enhanced our competitive position,” said Scott Thompson, chair and chief executive officer. “We exited 2019 with all-time record fourth-quarter sales, adjusted EBITDA and free cash flow. The combination of our powerful omnichannel distribution platform coupled with our market-leading brands and products continues to drive market share gains and solid financial performance. We are carrying our momentum from 2019 forward, and we expect record full-year revenues and over 20% growth in adjusted EBITDA in 2020.”
The company currently expects full-year fiscal 2020 adjusted EBITDA to range from $575 million to $650 million.
