Tempur Sealy International, Inc. (TPX) SEC Filing 10-Q Quarterly report for the period ending Saturday, June 30, 2018

Earnings Press Release
10-Q Quarterly Report
10-Q QoQ Changes
Tempur Sealy International, Inc.
Ticker: TPX CIK: 1206264

TEMPUR SEALY REPORTS SECOND QUARTER 2018 RESULTS

- Net Sales Increased 1.6%, Direct Sales Increased 22%

- Tempur-Pedic US Sales Increased 10%

- Updated Financial Guidance for the Full Year 2018

LEXINGTON, KY, July 26, 2018 - Tempur Sealy International, Inc. (NYSE: TPX) today announced financial results for the second quarter ended June 30, 2018. The Company also updated its financial guidance for the full year 2018.

SECOND QUARTER 2018 FINANCIAL SUMMARY


•	Total net sales increased 1.6% to $669.7 million from $659.3 million in the second quarter of 2017. On a constant currency basis⁽¹⁾, total net sales increased 1.2%, with an increase of 0.1% in the North America business segment and an increase of 5.4% in the International business segment.


•	Gross margin under U.S. generally accepted accounting principles ("GAAP") was 41.2% as compared to 40.7% in the second quarter of 2017.

•

GAAP operating income decreased 1.9% to $55.5 million as compared to $56.6 million in the second quarter of 2017. Operating income in the second quarter of 2018 included $6.9 million of restructuring charges. Adjusted operating income⁽¹⁾ increased 10.2% to $62.4 million as compared to GAAP operating income of $56.6 million in the second quarter of 2017. The Company had no adjustments to operating income in the second quarter of 2017.


•	GAAP net income decreased 6.9% to $22.8 million as compared to $24.5 million in the second quarter of 2017. Adjusted net income⁽¹⁾ increased 16.3% to $28.5 million as compared to GAAP net income of $24.5 million in the second quarter of 2017. The Company had no adjustments to net income in the second quarter of 2017.


•	Earnings before interest, tax, depreciation and amortization ("EBITDA")⁽¹⁾decreased 2.3% to $83.8 million as compared to $85.8 million for the second quarter of 2017. Adjusted EBITDA⁽¹⁾ increased 5.7% to $90.7 million as compared to EBITDA⁽¹⁾of $85.8 million in the second quarter of 2017. The Company had no adjustments to EBITDA in the second quarter of 2017.


•	GAAP earnings per diluted share ("EPS") decreased 6.7% to $0.42 as compared to $0.45 in the second quarter of 2017. Adjusted EPS⁽¹⁾ increased 15.6% to $0.52 as compared to GAAP EPSof $0.45 in the second quarter of 2017. The Company had no adjustments to EPS in the second quarter of 2017.

KEY HIGHLIGHTS



(in millions, except percentages and per common share amounts)	Three Months Ended				% Change		% Change Constant Currency ⁽¹⁾
	June 30, 2018		June 30, 2017		% Change		% Change Constant Currency ⁽¹⁾
Net sales	$	669.7	$	659.3	1.6	%	1.2	%
EBITDA ⁽¹⁾	83.8		85.8		(2.3	)%	(2.0	)%
Adjusted EBITDA ⁽¹⁾	90.7		85.8		5.7	%	6.0	%
EPS	0.42		0.45		(6.7	)%	(4.4	)%
Adjusted EPS ⁽¹⁾	0.52		0.45		15.6	%	17.8	%

Tempur Sealy International, Inc. Chairman and CEO Scott Thompson commented, "This quarter marks an important inflection point for the Company as we returned to growth, with Adjusted EPS⁽¹⁾ growing 15.6% compared to the second quarter of 2017. Our new Tempur and Sealy products are performing extremely well and are taking share in the mid-priced segment. We expect sales growth to ramp as we roll-out our higher end Tempur LuxeAdapt and Breeze products in North America over the next few quarters. These products will give our retail partners the tools they need to drive higher average selling prices and to increase their profitability. We are confident that the combination of these innovative new products, our expanding direct to consumer business, and our ongoing productivity initiatives will drive further growth in the second half of 2018 and beyond."

(1) This is a non-GAAP financial measure. Please refer to "Non-GAAP Financial Measures and Constant Currency Information" below.

The following information was filed by Tempur Sealy International, Inc. (TPX) on Thursday, July 26, 2018 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.

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