Citing economic doldrums, adjustable-bed maker Select Comfort slashed its forecast for the full year on Wednesday after missing earnings expectations for the third quarter.
The Plymouth-based bed retailer and manufacturer said full-year earnings are now expected to reach $1.14 to $1.22 a share, down from the prior guidance of $1.30 to $1.45 a share.
The downgrade came after the company did not meet sales and earnings expectations for the three-month period that ended Sept. 28.
Sales grew 6.8 percent to $263.7 million during the quarter but net income sank 23 percent to $20.26 million or 36 cents a share. On average analysts expected quarterly revenues of $277 million and earnings of 43 cents a share.
Select Comfort President and CEO Shelly Ibach noted that sales for the quarter rose but acknowledged that it wasn't enough to overcome rising sales, marketing and research expenses during a lackluster economy.
"Our execution was muted by a progressively more challenged macro-economic environment, resulting in performance below expectations," she said. "Given the ongoing economic uncertainty, we are actively managing costs across the company, while continuing to support priorities important to long-term growth and profitability."
During the quarter, Select Comfort opened 16 stores and closed six, leaving a total of 423 stores nationwide. The company had been working to open more stores in more visible strip-mall or stand-alone settings as opposed to the traditional mall-based model. Both types of stores have been striving for larger square footage and an array of new products and touch-and-feel displays.
As a result, capital expenditures for the first nine months of 2013 rose to $57.8 million from $36.8 million for the same period in 2012.
Select Comfort's stock officially closed at $24.20 Wednesday, down 49 cents a share.