Bedding major Sealy posted $339.6 million in net sales during its 2010 fiscal first quarter, an increase of 9.6% compared to the same period a year ago. The successful launch of the new Stearns & Foster line and a more stable retail environment drove the positive performance, the Archdale, N.C.–based company said.
Net income was $5.7 million, an increase of 31.5% when compared to $4.3 million in the first quarter of 2009. Operating income rose to $34.8 million, up 49% over the same period a year ago.
“We are very pleased with our first–quarter 2010 results, as we delivered top–line growth, driven by both unit growth and average unit selling price growth,” said Larry Rogers, Sealy president and chief executive officer. “These results represent our second consecutive quarter of year–over–year sales growth. We are seeing the benefits of our relentless focus on reducing our cost structure throughout the economic downturn.”
Sealy’s gross margin increased 331 basis points to 41.3%, driven by a 202 basis point gain in its U.S. market. Gross profit was $140.1 million compared to $117.6 million in the first quarter of fiscal 2009. U.S. gross profit margin increased 202 basis points to 42.3%. The increase was driven primarily by lower material costs and improved manufacturing efficiencies, the company said.
Total U.S. net sales increased 4.9% to $246.4 million. Wholesale domestic net sales, which exclude third–party sales from Sealy’s component plants, grew 4.6% to $241.6 million when compared to the first quarter of 2009.
International net sales for the quarter increased $18 million, or 24%, to $93.3 million. Excluding the effects of currency fluctuation, international net sales increased 11.9%. Sales growth in Canada played a significant role, the company said. Canadian sales were 32.5% higher than in the same quarter of the previous year.
“We are encouraged by the stabilization we have seen in retail demand across our business segments,” Rogers said.
