3Q Profit Jumps 52 Percent for Select Comfort; Sales Set Record
MINNEAPOLIS-Fueled by record sales, third-quarter net income for Select Comfort climbed 52.1 percent to $26.2 million.
Net sales for the quarter, which ended on Sept. 29, rose 23.7 percent to $246.8 million, a new record for the third quarter, and including a same-store sales gain of 21 percent for Select Comfort's own stores. Shelly Ibach, the company's president and CEO, attributed the strong sales to shoppers' positive response to the Sleep Number brand experience, including its proprietary products and store experience.
Select Comfort also recorded a healthy 210 basis-point pickup in gross margin, which finished the quarter at 65.1 percent. Selling, general and administrative expenses were up 20.7 percent in dollars but fell 110 basis points as a percentage of sales, to 48.1 percent.
In the fourth quarter, Ibach said the Select Comfort strategy will be to increase its investments in building brand awareness and in product innovation, along with developing new markets. "We remain committed to our goal of delivering greater than 20 percent annual earnings-per-share growth while exceeding $1.5 billion in sales and 15 percent operating margin by 2015," she said.