− Sales Increase 20.8% on 6.5% Comp Sales In
Fiscal Fourth Quarter −
− Updates Financial Expectations For
Fiscal 2013 –
− Provides Preliminary Guidance For
Fiscal 2014 −
Mattress Firm Holding Corp. (the “Company”) (NASDAQ:MFRM) today
reported preliminary net sales for the fourth fiscal quarter (13
weeks) and full fiscal year (52 weeks) ended January 28, 2014. Net
sales for the fourth fiscal quarter increased 20.8% to $312
million, reflecting comparable-store sales growth of 6.5% and the
addition of new and acquired stores. Net sales for the full fiscal
year increased 20.8% to $1,217 million, reflecting comparable-store
sales growth of 1.3% and the addition of new and acquired
stores.
“The increase in net sales for the fourth fiscal quarter and for
the full fiscal year 2013 continues to reflect our deliberate
growth initiatives,” stated Steve Stagner, Mattress Firm’s
president and chief executive officer. “However, while we are proud
of the relentless efforts of our sales force in the face of a tough
consumer environment, we now recognize that, although our results
are not yet final, our earnings per share for the fiscal year will
be below our expectations. The consumer environment and unusually
inclement weather conditions in a number of our primary markets
presented challenges that we were unable to fully overcome. The
effects of our ongoing efforts to drive higher sales conversion and
traffic during the fourth quarter resulted in a decrease in
operating margin of approximately 200 to 230 basis-points as
compared with prior year results. We remain committed to our
strategy of driving continued sales growth, increasing relative
market share across the chain and positioning the Company for
long-term growth of shareholder value as the largest and fastest
growing mattress specialty retailer in the United States.”
Reported sales results are preliminary and remain subject to
adjustment until the filing of the Company’s Annual Report on Form
10-K with the U.S. Securities and Exchange Commission.
The Company expects to report its finalized fourth fiscal
quarter and full 2013 fiscal year results by the end of March
2014.
Net Sales and Store Unit Information
The components of the net sales increase for the thirteen and
fifty-two weeks ended January 28, 2014 as compared to the
corresponding prior year period were as follows (in millions):
Increase (Decrease) in
Net Sales Thirteen Weeks Fifty-Two
Weeks Ended Ended January 28, 2014
January 28, 2014 Comparable-store sales $ 16.6 $ 13.0 New
stores 34.6 132.0 Acquired stores 6.6 78.4 Closed stores
(3.9 ) (13.9 ) $ 53.9 $ 209.5
The activity with respect to the number of Company-operated
store units for the thirteen and fifty-two weeks ended January 28,
2014 was as follows:
Thirteen
Weeks Fifty-Two Weeks Ended Ended
January 28, 2014 January 28, 2014 Store units,
beginning of period 1,155 1,057 New stores 33 154 Acquired stores
46 46 Closed stores (9 ) (32 ) Store units, end of period 1,225
1,225
Updated Financial Guidance for Fiscal Year 2013
The Company is updating its guidance for the full fiscal year
(52 weeks) ended January 28, 2014 (“fiscal year 2013”). The Company
reports earnings per diluted share on a generally accepted
accounting principles basis (“GAAP EPS”) and on a non-GAAP adjusted
basis, excluding acquisition-related and ERP system implementation
costs (“Adjusted EPS”).
Full Fiscal Year
Ending January 28, 2014
Prior
Guidance
Updated
Guidance
Net sales (in billions) $1.217 to $1.224 $1.217 New stores 140 to
150 154 Acquired stores 44 46 Net store unit increase 155 to 160
168 GAAP EPS $1.65 to $1.73 $1.53 to $1.55 Acquisition-related
costs per share $0.03 $0.03 ERP system implementation costs per
share $0.07 $0.07 Store impairment charge -- $0.01 Adjusted EPS
$1.75 to $1.83 $1.64 to $1.66 Comparable-store sales growth flat to
low single digit 1.3%
Preliminary Financial Guidance for Fiscal Year 2014
The Company is also providing preliminary financial guidance for
the full fiscal year (53 weeks) ending February 3, 2015 (“fiscal
year 2014”). These projections are preliminary forecasts and are
intended solely to give investors an understanding of management’s
expectations for the full fiscal year in light of the recent
consumer environment and sales trends. The projections do not take
into account, or give effect for, acquisitions that may be
completed by the Company during the fiscal year or any other events
that are beyond the Company’s reasonable control. The Company will
update these projections concurrently with the release of its
finalized results for the fourth fiscal quarter and fiscal year
2013.
Full Fiscal Year
Ending February 3, 2015
Preliminary Guidance
Range
Net sales (in billions) $1.380 to $1.430 New stores 140 to 160 Net
store unit increase 110 to 125 GAAP EPS $1.72 to $1.81 ERP system
implementation costs per share $0.13 to $0.14 Adjusted EPS $1.85 to
$1.95 Comparable-store sales growth low single digit
Fiscal year 2014 will consist of 53 weeks, as compared with
fiscal year 2013, which consisted of 52 weeks. Comparable-store
sales growth for fiscal year 2014 excludes incremental sales
related to the extra week of operations.
Forward-Looking Statements
Certain statements contained in this press release are not based
on historical fact and are “forward-looking statements” within the
meaning of applicable federal securities laws and regulations. In
many cases, you can identify forward-looking statements by
terminology such as “may,” “would,” “should,” “could,” “forecast,”
“feel,” “project,” “expect,” “plan,” “anticipate,” “believe,”
“estimate,” “predict,” “intend,” “potential,” “continue” or the
negative of these terms or other comparable terminology; however,
not all forward-looking statements contain these identifying words.
The forward-looking statements contained in this press release,
such as those relating to our GAAP and Adjusted EPS for fiscal year
2013 and preliminary financial guidance and projections for fiscal
year 2014, are subject to various risks and uncertainties,
including but not limited to downturns in the economy; reduction in
discretionary spending by consumers; our ability to execute our key
business strategies and advance our market-level profitability; our
ability to profitably open and operate new stores and capture
additional market share; our relationship with our primary mattress
suppliers; our dependence on a few key employees; the possible
impairment of our goodwill or other acquired intangible assets; the
effect of our planned growth and the integration of our
acquisitions on our business infrastructure; the impact of
seasonality on our financial results and comparable-store sales;
our ability to raise adequate capital to support our expansion
strategy; our success in pursuing and completing strategic
acquisitions; the effectiveness and efficiency of our advertising
expenditures; our success in keeping warranty claims and comfort
exchange return rates within acceptable levels; our ability to
deliver our products in a timely manner; our status as a holding
company with no business operations; our ability to anticipate
consumer trends; risks related to our controlling stockholder, J.W.
Childs Associates, L.P.; heightened competition; changes in
applicable regulations; risks related to our franchises, including
our lack of control over their operation and our liabilities if
they default on note or lease obligations; risks related to our
stock and other factors set forth under “Risk Factors” in our
Annual Report on Form 10-K for the fiscal year ended January 29,
2013 filed with the Securities and Exchange Commission (“SEC”) on
April 1, 2013 and our other SEC filings. Forward-looking statements
relate to future events or our future financial performance and
reflect management’s expectations or beliefs concerning future
events as of the date of this press release. Actual results of
operations may differ materially from those set forth in any
forward-looking statements, and the inclusion of a projection or
forward-looking statement in this press release should not be
regarded as a representation by us that our plans or objectives
will be achieved. We do not undertake to publicly update or revise
any of these forward-looking statements, whether as a result of new
information, future events or otherwise.
Non-GAAP Financial Measures
Adjusted EPS and the other “Adjusted” data provided in this
press release are considered non-GAAP financial measures. We report
our financial results in accordance with U.S. GAAP; however,
management believes evaluating our ongoing operating results may be
enhanced if investors have additional non-GAAP basis financial
measures to facilitate year-over-year comparisons. Management
reviews non-GAAP financial measures to assess ongoing operations
and considers them to be effective indicators, for both management
and investors, of our financial performance over time. Our
management does not advocate that investors consider such non-GAAP
financial measures in isolation from, or as a substitute for,
financial information prepared in accordance with U.S. GAAP.
About Mattress Firm
Houston-based Mattress Firm is a high growth specialty retailer,
recognized as the nation's leading bedding specialty retailer,
offering a broad selection of both traditional and specialty
mattresses, bedding accessories and related products from leading
manufacturers. With more than 1,300 company-operated and franchised
stores across 33 states, Mattress Firm has the largest geographic
footprint in the United States among multi-brand mattress specialty
retailers. Mattress Firm offers customers comfortable store
environments, guarantees on price, comfort and service, and
highly-trained sales professionals. More information is available
at http://www.mattressfirm.com. Mattress Firm’s website is not part
of this press release.
Investor Relations:Brad Cohen,
713-343-3652ir@mattressfirm.comorMedia:Sunni Goodman,
713-343-3579sunni.goodman@mattressfirm.com
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