Mattress Firm Q4 Net Drops 56.3 Percent; Fiscal Year Net Jumps 16.1 Percent
HOUSTON-Income-tax expenses drove fourth-quarter net income for Mattress Firm down 56.3 percent, to $7.6 million.
That expense compared to an income-tax benefit of $9.7 million in the fourth quarter of last year. For the fiscal year ending on Jan. 29, Mattress Firm's net increased 16.1 percent to $39.9 million.
Both the quarter and the year saw sales make huge gains for the retailer. Net sales in the quarter surged 37 percent to $258.2 million, while for the year net sales jumped 43.1 percent to $1 billion. The increases resulted largely from a 45 percent rise in Mattress Firm's store base during 2012, much of which came from acquisitions.
Same-store sales in the quarter actually slipped 1.6 percent. For the year, same-store sales increased 6.1 percent.
Lower sales productivity from the acquired stores, a decline in franchise fees and deleveraging of other expense categories combined to cut 230 basis points from Mattress Firm's gross margin in the quarter, to 37.9 percent. These costs also played a role in boosting selling, general and administrative expenses by 29.1 percent in dollars. As a percentage of sales, SG&A fell 190 basis points to 30.7 percent.
In a conference call to retail analysts yesterday, Steve Stagner, Mattress Firm's president and CEO, said the company has integrated almost all of the acquired stores. In addition, the retailer is on pace to add a further 100 stores to its base for the third year in a row, Stagner said.
"We are delivering a plan in 2013 that is achievable and not dependent on any significant improvement in the economy or in consumer sentiment in order to achieve our goals of 23 percent sales growth and 30 percent (earnings per share) growth," he said.