Sealy Net Loss Grows to $15.2 Million in Fourth Quarter

TRINITY, N.C.-In what retiring President and CEO Larry Rogers called a disappointing performance, Sealy's fourth-quarter net loss climbed from $4.5 million to $15.2 million from fiscal years 2010 to 2011.

Significant drops in both sales and gross margin were the primary culprits. Net sales in the quarter, which ended on Nov. 27, were off 9.2 percent to $269.3 million, as sales in the company's lower-price-point products lost volume due to increased competition. That sales decline, along with higher raw-materials cost, combined to reduce gross margin by 500 basis points, to 36.4 percent. Selling, general and administrative expenses on a dollar basis were flat in comparison with the prior year's fourth quarter, but increased 336 basis points as a percentage of sales to 36.7 percent.

Rogers said the fourth-quarter results were "not in line with the goals that we set forth in the beginning of 2011," and added that Sealy is making "operational changes to improve our future business results." He added that the company is now focused on the launch of its Next Generation Stearns & Foster line and the development of its specialty division. He also said he expects that much of the industry's growth in 2012 will come from upper-price-point and lower-price-point mattress lines.

In December, Sealy announced that Rogers would retire some time this year, and that the company is currently searching for his successor.

For the full fiscal 2011 year, Sealy was able to reduce its net loss from $13.7 million in 2010 to $9.9 million in 2011. Net sales rose a bare 0.8 percent to $1.2 billion.

HFN Staff | News & Commentary

HFN provides detailed information on the key home classifications: Housewares, Tabletop, Floor Covering & Rugs, Furniture, Home Textiles, Lighting, Home Decor, Mattresses & Bedding, Gifts, Major Appliances and Consumer Electronics as well as Business, Finance and Retail.

Videos

  • Patti Carpenter Talks Color and its Importance in the Home

    Camera Icon   More Videos

Subscribe to
HFN Omnichannel
Receive the news you need to know about the trends in the industry delivered right to your inbox.

Current Issue

  • HFN August 2017 cover

    HFN's DIGITAL EDITION

    August 2017


    COVER STORY: Sharpening the Focus on Millennials

    Find out what makes Millennials tick when it comes to home decorating, shopping and at-home entertaining with HFN's annual consumer study. Turns out, Millennials favor the in-store shopping experience.


    ALSO IN THIS ISSUE:

    • Power of the People - Crowdfunding campaigns provide needed capital, feedback for home and housewares product launches.
    •  Omnichannel Retailing: Visual Search Takes Off - Learn how voice and visual search are revolutionizing product discovery.