Tempur Sealy Loss Grows in Q2
LEXINGTON, Ky.-Tempur Sealy posted a second-quarter net loss of $2.2 million, compared to a second-quarter net loss of $1.6 million from last year.
The loss occurred as the company continued to absorb integration costs of last year's merger between Tempur-Pedic and Sealy. In addition, it reported a $20.4 million loss related to its disposal of its three U.S. innerspring component production facilities.
Net sales in the quarter, which ended on June 30, rose 8.2 percent to $715 million. This included a 10.1 percent gain in sales in the Tempur North America segment, along with an increase of 12.2 percent in overall bedding sales. These pickups were offset by a 16.3 percent drop in net sales of "other products," said a Tempur Sealy statement.
Gross margin was down 107 basis points to 37.5 percent. Selling, marketing, general and administrative expenses rose 4 percent in dollars but declined 128 basis points as a percentage of sales, to 31.4 percent.
Mark Sarvary, Tempur Sealy's CEO, said the second quarter finished in line with the company's expectations. "The investment in new products and related marketing in the first half of 2014 pressured margins," Sarvary said, "but now that the products are rolled out, we expect significant margin improvement for the balance of the year."