LEXINGTON, Ky. - Tempur Sealy (NYSE:TPX) International, Inc. (NYSE: TPX) reported mixed financial results for the first quarter ended March 31, 2024, with adjusted earnings per share (EPS) slightly above analyst expectations but revenue falling short.
The company announced an adjusted EPS of $0.50, surpassing the analyst estimate of $0.49. However, revenue for the quarter was $1.19 billion, below the consensus estimate of $1.21 billion.
Despite a challenging global economic environment, Tempur Sealy maintained strong consolidated gross margins, which rose 1.7% to 43.1%. The company's net sales of $1.2 billion remained consistent with the prior year, while operating cash flow reached a record $130 million for the first quarter.
The North American segment experienced a sales decrease of 2.0%, while international sales remained consistent. Adjusted gross margins improved in both segments, with North America seeing a 160 basis point increase and the International segment a 140 basis point improvement. This was primarily due to favorable commodity costs and operational efficiencies.
Chairman and CEO Scott Thompson highlighted the company's resilience amidst a "historical nadir" in the global market. He attributed the strong quarterly performance to the successful launch of new products, effective marketing, and operational efficiencies. Thompson also provided an update on the pending Mattress Firm transaction, expressing confidence in its eventual completion and the benefits it will bring to customers and shareholders.
Looking ahead, Tempur Sealy reaffirmed its full-year 2024 guidance, projecting an adjusted EPS range of $2.60 to $2.90. This guidance anticipates low to mid-single digit year-over-year sales growth and represents a 15% increase from the previous year at the midpoint, aligning with the analyst consensus of $2.75.
The company's financial stability is further underscored by its leverage ratio, which improved from 3.24 times in the trailing twelve months ended March 31, 2023, to 2.85 times in the current period.
Tempur Sealy's Board of Directors also declared a quarterly cash dividend of $0.13 per share, demonstrating confidence in the company's financial health and commitment to shareholder returns.
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