Mattress Firm (MFRM) Prelim. Q3 Revenue, EPS Top Views

Mattress Firm (NASDAQ: MFRM) reported preliminary net sales and Adjusted EPS for the third fiscal quarter (thirteen weeks) ended November 3, 2015. Net sales for the third fiscal quarter increased 50.7% to $699.5 million, reflecting comparable-store sales growth of 3.8% and the addition of new and acquired stores. The Company expects third fiscal quarter earnings per diluted share (“EPS”) on a generally accepted accounting principles (“GAAP”) basis of $0.65 to $0.67, and EPS on a non-GAAP adjusted (“Adjusted”) basis, excluding acquisition-related costs and impairment and severance charges, is expected to be between $0.80 and $0.82 per diluted share for the third fiscal quarter.

*** The Street sees Q3 revenue of $647.5 million and EPS of $0.77.

“We delivered strong results in the third quarter, with over 50% net sales growth driven by our acquired stores, new stores, and our 3.8% same store sales growth,” stated Steve Stagner, chief executive officer. “This represents our ninth consecutive quarter of positive same store sales growth. We currently anticipate reporting third quarter Adjusted EPS growth of 14% to 17%, in-line with our expectations for the quarter. Our entire organization is executing well and benefiting from the streamlined organizational structure and management initiatives we have in place. We remain focused on executing on our growth plan and creating value for our shareholders through our relative market share strategy.”

Reported sales results and expected GAAP and Adjusted EPS are preliminary and remain subject to adjustment until the filing of the Company’s Quarterly Report on Form 10-Q with the U.S. Securities and Exchange Commission. The Company expects to report its finalized third fiscal quarter results on December 7, 2015.

Expected third fiscal quarter diluted EPS on a GAAP basis and Adjusted basis are reconciled in the table below:

(1) Reflects the acquisition-related costs as defined under U.S. GAAP, including advisory, legal, accounting, valuation, and other professional or consulting fees and, in addition, costs of integrating store and warehouse operations and corporate functions.

(2) Reflects implementation costs consisting primarily of training-related costs in connection with the roll-out of the Microsoft Dynamics AX for Retail Enterprise Resource Planning system ("ERP system").

(3) Reflects a loss on debt extinguishment incurred in connection with the October 2014 refinancing of the Company’s Senior Credit Facility related to the Sleep Train acquisition. Reflects severance expense related to changes in organizational structure recorded in October 2015.

Net Sales and Store Unit Information

The components of the net sales increase for the thirteen and thirty-nine weeks ended November 3, 2015 were as follows (in millions):

The activity with respect to the number of Company-operated store units for the thirteen and thirty-nine weeks ended November 3, 2015 was as follows:

Financial Guidance for Fiscal Year 2015

The Company also reaffirmed the midpoint of its financial outlook for sales, Adjusted EBITDA and Adjusted EPS for the full fiscal year (52 weeks) ending February 2, 2016 (“fiscal year 2015”). This outlook is based on year-to-date results and efficiency initiatives that have been recently implemented by management. These projections are forecasts and are intended solely to give investors an understanding of management’s expectations for the full fiscal year based on recent business trends. The projections do not take into account, or give effect for, acquisitions that may be completed by the Company during the fiscal year or any other events that are beyond the Company’s reasonable control. Please refer to "Reconciliation of Reported (GAAP) to Adjusted Statements of Operations Data" in the second quarter earnings release dated September 11, 2015 for a reconciliation of GAAP EPS to Adjusted EPS and other information which is not calculated on a GAAP basis. Comparable-store sales growth for fiscal year 2014 excludes incremental sales related to the 53rd week of operations. Adjusted data for future periods reflects management’s reasonable estimates of appropriate adjustments based on historical experience. Percentage growth calculations in the table below represent the midpoints of the guidance range provided.

(1) Represents approximate growth from actual results for the 53-weeks ended February 3, 2015 (excluding the incremental sales impact of the 53rd week for purposes of comparable-store sales growth), to the midpoint of the fiscal 2015 guidance.

Mattress Firm to Host Third Fiscal Quarter 2015 Earnings Conference Call on December 7th

The Company will release finalized financial results for the third quarter of the 2015 fiscal year before the market opens on Monday, December 7, 2015.

The Company will host a conference call for investors and other interested parties beginning at 8:30 a.m. Eastern Time on Monday, December 7, 2015. The call will be hosted by Steve Stagner, chief executive officer, Ken Murphy, president, Alex Weiss, chief financial officer, and Scott McKinney, vice president of investor relations.

The conference call will be accessible by telephone and the Internet. To access the call, participants from within the U.S. may dial (877) 705-6003, and participants from outside the U.S. may dial (201) 493-6725. Participants may also access the call via live webcast by visiting the Company's investor relations website at ir.mattressfirm.com.

A replay of the call will be available beginning at approximately 11:30 a.m. Eastern Time on December 7, 2015 through approximately midnight Eastern Time on December 21, 2015. To access the replay, the domestic dial-in number is (877) 870-5176, the international dial-in number is (858) 384-5517, and the passcode is 13625562. An archive of the webcast will also be available on the Company's website for a limited time.

You May Also Be Interested In

• Nanometrics (NANO) Issues Business Update, Reports FY23 Results
• First Bancorp. (FBNC) Misses Q1 EPS by 2c
• O'Reilly Automotive (ORLY) Misses Q1 EPS by 7c, Offers Guidance