TEMPUR SEALY REPORTS RECORD THIRD QUARTER RESULTS
-Net Sales Increased 38%
-EPS Increased 75% to $2.29, Adjusted EPS Increased 126% to $2.94
-Net Income of $121 Million
-Trailing Twelve Month Adjusted EBITDA of $694 Million
-Announced New Long-Term Capital Allocation Strategy
LEXINGTON, KY, October 29, 2020 - Tempur Sealy International, Inc. (NYSE: TPX) announced financial results for the third quarter ended September 30, 2020.
THIRD QUARTER 2020 FINANCIAL SUMMARY
•Total net sales increased 37.9% to $1,132.3 million as compared to $821.0 million in the third quarter of 2019. On a constant currency basis(1), total net sales increased 37.7%, with an increase of 43.3% in the North America business segment and an increase of 10.1% in the International business segment.
•Gross margin was 46.8% as compared to 43.9% in the third quarter of 2019. Adjusted gross margin(1) was 46.9% in the third quarter of 2020. There were no adjustments to gross margin in the third quarter of 2019.
•Operating income increased 49.4% to $180.2 million as compared to $120.6 million in the third quarter of 2019. Operating income in the third quarter of 2020 included $45.2 million of amortization for aspirational plan stock-based compensation. Adjusted operating income(1) was $227.2 million in the third quarter of 2020. There were no adjustments to operating income in the third quarter of 2019.
•Net income increased 65.6% to $121.4 million as compared to $73.3 million in the third quarter of 2019. Adjusted net income(1) increased 114.3% to $155.4 million as compared to $72.5 million in the third quarter of 2019.
•Earnings before interest, tax, depreciation and amortization ("EBITDA")(1) increased 85.7% to $279.9 million as compared to $150.7 million in the third quarter of 2019. Adjusted EBITDA per credit facility(1) increased 86.3% to $279.3 million as compared to $149.9 million in the third quarter of 2019.
•Earnings per diluted share ("EPS") increased 74.8% to $2.29 as compared to $1.31 in the third quarter of 2019. Adjusted EPS(1) increased 126.2% to $2.94 as compared to $1.30 in the third quarter of 2019.
•For the trailing twelve months ended September 30, 2020, leverage based on the ratio of consolidated indebtedness less netted cash(1) to adjusted EBITDA per credit facility(1) was 1.92 times as compared to 3.22 times in the corresponding prior year period.
•Net cash provided by operating activities increased to a record $327.5 million as compared to $155.8 million in the third quarter of 2019.
|(in millions, except percentages and per common share amounts)||Three Months Ended||% Reported Change|
% Constant Currency Change(1)
|September 30, 2020||September 30, 2019|
|Net sales||$||1,132.3 ||$||821.0 ||37.9 ||%||37.7 ||%|
|Net income||$||121.4 ||$||73.3 ||65.6 ||%||65.5 ||%|
|$||279.9 ||$||150.7 ||85.7 ||%||85.5 ||%|
Adjusted EBITDA per credit facility (1)
|$||279.3 ||$||149.9 ||86.3 ||%||86.1 ||%|
|EPS||$||2.29 ||$||1.31 ||74.8 ||%||74.8 ||%|
Adjusted EPS (1)
|$||2.94 ||$||1.30 ||126.2 ||%||126.2 ||%|
Company Chairman and CEO Scott Thompson commented, "Our results reflect strong industry demand, our worldwide leadership position in the industry, and the success of our omni-channel distribution strategy. As expected, our net sales growth rate was reduced by about 10% from customer orders that were either cancelled or reduced due to allocations in the quarter due to supplier issues impacting Sealy and Sherwood in the U.S. Despite the supply issues, this quarter marks our seventh consecutive quarter of trailing twelve month adjusted EBITDA growth. The significant investments we have made in our people, products, customer service and manufacturing operations over the last few years are clearly paying off.
"The Company has grown adjusted EBITDA over the last five-years at a compounded annual growth rate of 12% resulting in $694 million of adjusted EBITDA on a trailing twelve month basis ending September 30, 2020. The Company’s long-term strategies and recent investments position Tempur Sealy as a growth company with a fortified balance sheet and a capital allocation plan that is designed to drive shareholder value, mitigate volatility and increase diversity of its shareholder base."
(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, October 29, 2020 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.