LEXINGTON, Ky.—Tempur-Pedic posted a 72 percent increase to its net income in the third quarter, to $44.2 million.
The mattress manufacturer improved its bottom line based on a net sales gain of 32 percent to $295.8 million, and a pickup of 340 basis points in gross margin, which finished the quarter at 51 percent. The sales increase included a 47 percent jump in sales in North America. These factors offset increases of 36 percent in selling expenses and 19 percent in general and administrative expenses.
Speaking on a conference call to stock analysts, Mark Sarvary, Tempur-Pedic’s president and chief executive officer, said the third quarter was highlighted by the company’s rollout of its entry-level Tempur-Cloud mattress, followed late in the period by the rollout of the Tempur-Cloud Luxe model. In addition, the company boosted its total advertising investments 37 percent to $25 million.
Despite the fact that consumer traffic at retail “is not back to normal…we believe that our business will continue to grow and our share gains will continue,” Sarvary said.
Dale Williams, chief financial officer, told the analysts that Tempur-Pedic now expects sales for all of 2010 to range between $1.095 billion to $1.115 billion, up from 32 percent to 34 percent over 2009.