Sales up 17 percent. Earnings down 3
A host of store openings and remodeling fluffed sales but jacked up expenses for Select Comfort Corp. in the fourth quarter, prompting the maker of adjustable beds to miss analysts' earnings expectations by a dime.
Results, announced after the market closed, prompted the stock price to fall in after-hours trading. It fell $5.21 a share to $22.99.
Fourth-quarter sales soared 17 percent to a record $221 million.
However, operating earnings fell 3 percent to $19.4 million, excluding a one-time tax gain from fourth quarter 2011. Earnings included nearly $21 million in new expenses for sales, marketing and R&D costs associated with store openings, store redesigns and fresh product offerings.
Including the tax benefit, earnings fell 19 percent to 22 cents a share for the quarter. On average, analysts expected earnings of 32 cents a share and sales of $230 million for the quarter.
Still, officials at the Plymouth-based bedmaker remained optimistic. They now expect full-year 2013 same-store sales to rise 10 percent and for earnings to reach $1.65 to $1.80 a share. That would be a 15 to 26 percent increase over the adjusted $1.43 reported in 2012.
Select Comfort also expects its store count to rise from 410 in December 2012 to between 435 and 445 by December 2013.
The company, which opened 57 new stores in 2012, is turning to new store concepts that feature larger stores and standalone stores.
CEO Shelly Ibach said in a previous interview that the new upgraded stores feature high-tech and high-touch displays that sell more products per customer than the firm's traditional mall-based stores that have not yet been upgraded.
Dee DePass • 612-673-7725
Figures in millions except for earnings per share.