Sleep Number Corp (SNBR) 10-Q Quarterly Report Fri Apr 29 2022

“External factors continue to disrupt global supply and weaken consumer confidence, resulting in increased business complexity and volatility,” said Shelly Ibach, President and CEO. “In this dynamic environment, we remain focused on deepening consumer relationships and innovating for broad relevance while taking decisive actions to address near-term pressures. Our team is highly engaged and resilient, and our business model, liquidity and competitive advantages are strong. We remain steadfast in our commitment to fulfilling our purpose and creating superior long-term shareholder value.”

First Quarter Overview

•Net sales decreased 7% to $527 million while demand decreased 3% for the quarter, reflecting the impact of Omicron in January and the war in Ukraine in late February; excess backlog increased to over $200 million

•Gross margin of 57.3% of net sales was approximately 100 basis points above expectations due to level-loaded delivery efficiencies during the quarter

•Diluted EPS of 9 cents for the first quarter was below expectation of 30 to 40 cents on lower-than-expected delivered net sales

Cash Flows and Liquidity Review

•Generated $25 million in net cash from operating activities in the first quarter, compared with $112 million for the same period last year on constrained current year deliveries and changes in working capital

•Invested $42 million in Sleep Number stock compared to $167 million for the same period last year

•Leverage ratio of 3.4x EBITDAR at the end of the first quarter; more than $400 million of liquidity remains against current revolver

•Return on invested capital (ROIC) of 20.5% for the trailing twelve-month period reflecting two consecutive quarters constrained by electronics component supply

Financial Outlook

The company updated its full-year 2022 diluted EPS outlook to a range of $5.00 to $6.00 per share. The outlook assumes low double-digit net sales growth for 2022 on flat to low single-digit demand growth the balance of the year, while servicing significant excess backlog. The company expects to generate approximately $200 million of cash from operations and anticipates 2022 capital expenditures of $70 million to $80 million.

Conference Call Information

Management will host its regularly scheduled conference call to discuss the company’s results at 5 p.m. EDT (4 p.m. CDT; 2 p.m. PDT) today. To access the webcast, please visit the investor relations area of the Sleep Number website at https://ir.sleepnumber.com. The webcast replay will remain available for approximately 60 days.

The following information was filed by Sleep Number Corp (SNBR) on Wednesday, April 20, 2022 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

Please wait while we load the requested 10-Q report or click the link below:

https://last10k.com/sec-filings/report/827187/000082718722000038/snbr-20220402.htm

View differences made from one quarter to another to evaluate Sleep Number Corp's financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ) — *Sample 10-K Year-over-Year (YoY) Comparison*

Compare this 10-Q Quarterly Report to its predecessor by reading our highlights to see what text and tables were ~~removed~~ , added and changed by Sleep Number Corp.

Continue

Assess how Sleep Number Corp's management team is paid from their Annual Proxy

Sleep Number Corp's Definitive Proxy Statement (Form DEF 14A) filed after their 2022 10-K Annual Report includes:

Voting Procedures
Board Members
Executive Team
Salaries, Bonuses, Perks
Peers / Competitors

Continue

Rating
Learn More

Filter by Sentiment:

All

Positive

Negative

Filter by Category:

All

Financial

Revenue

Other

Filter by Subcategory:

All

Expense

Earnings

Product

Income

Cash Flow

Other

Inside Sleep Number Corp's 10-Q Quarterly Report:

Other - Other Highlight
Our MD&A is presented in eight sections: Forward-Looking Statements and Risk Factors Business Overview COVID-19 Pandemic - Impact on our Business Results of Operations Liquidity and Capital Resources Non-GAAP Data Reconciliations Off-Balance-Sheet Arrangements and Contractual Obligations Critical Accounting Policies Forward-looking Statements and Risk Factors The discussion in this Quarterly Report contains certain forward-looking statements that relate to future plans, events, financial results or performance.

Financial - Shares Highlight
Changes in cash and cash equivalents during the three months ended April 2, 2022 primarily consisted of $25 million of cash provided by operating activities and a $45 million net increase in short-term borrowings, offset by $20 million of cash used to purchase property and equipment, and $51 million of cash used to repurchase our common stock (based on settlement, $42 million under our Board-approved share repurchase program and $9 million in connection with the vesting of employee restricted stock grants).
Financial - Expense Highlight
The $1.3 million decrease in G&A expenses consisted mainly of: (i) a $6.7 million decrease in employee compensation primarily resulting from a year-over-year decrease in Company-wide performance-based incentive compensation; offset by (ii) a $5.4 million increase in other miscellaneous expenses, including technology investments and travel expenses (minimal travel in the prior year due to the pandemic).
Other - Other Highlight
And because our more than 5,500 team members are dedicated to our mission as well as the disciplined execution of our vertically integrated business model and differentiated strategy, Sleep Number is at the forefront of sleep innovation.
Financial - Earnings Highlight
Together with our expertise in sleep research, commitment to data science and analytics, and deep understanding of consumers - including structural shifts in their behavior that we have anticipated since the 2012 inception of our consumer innovation strategy and which were accelerated by the global pandemic - we are driving profitable growth and delivering superior value for all our stakeholders.
Financial - Earnings
gross profit rate decrease was...Read more
Revenue - Product
Global supply constraints negatively impacted...Read more
Revenue - Product
Total Retail average revenue per...Read more
Financial - Earnings
The tables below reconcile net...Read more
Financial - Income
The $72 million decrease in...Read more
Other - Other
Management believes Adjusted EBITDA is...Read more
Other - Other
With our enterprise-wide investments in...Read more
Revenue - Product
in the current-year period, compared...Read more
Financial - Expense
The G&A expenses rate increased...Read more
Financial - Income
The effective income tax rate...Read more
Financial - Expense
In the first quarter of...Read more
Financial - Expense
increase in our operating expenses...Read more
Other - Other
The table below reconciles Adjusted...Read more
Financial - Cash Flow
Our Adjusted EBITDA calculations are...Read more
Financial - Expense
In addition, we continued to...Read more
Other - Other
To date, we have improved...Read more
Revenue - Product
Results of Operations Quarterly and...Read more
Financial - Earnings
decrease in our gross profit...Read more
Revenue - Product
The 7% net sales decrease...Read more
Revenue - Product
The 7% net sales decrease...Read more
Other - Other
Short-term borrowings increased by $45...Read more
Financial - Earnings
The gross profit rate declined...Read more
Revenue - Product
Sales per store (sales for...Read more
Financial - Income
(3)Reflects annual effective income tax...Read more
Other - Other
In addition, based on the...Read more
Financial - Earnings
Significant components of the year-over-year...Read more
Financial - Expense
Interest expense Interest expense, net...Read more
Other - Other
The $1 million increase was...Read more
Other - Other
In the first quarter of...Read more
Other - Other
Cash provided by operating activities...Read more
Other - Other
Short-term borrowings increased by $74...Read more
Revenue - Product
; (ii) the deleverage from...Read more
Financial - Earnings
Net income for the three...Read more
Other - Other
Note - Our ROIC calculation...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Sleep Number Corp provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: SNBR
CIK: 827187
Form Type: 10-Q Quarterly Report
Accession Number: 0000827187-22-000038
Submitted to the SEC: Fri Apr 29 2022 4:08:49 PM EST
Accepted by the SEC: Fri Apr 29 2022
Period: Saturday, April 2, 2022
Industry: Household Furniture