Tempur Sealy(US:TPX)2025-05-08 10:37Financial Performance - First Quarter 2025 net sales increased by 34.9% to $1,604.7 million compared to $1,189.4 million in the first quarter of 2024, driven by Mattress Firm's sales of $593.7 million for the stub period[4][7] - The Company reported a net loss of $(33.1) million in the first quarter of 2025, a decline of 143.4% compared to net income of $76.3 million in the same period last year[4][7] - Adjusted net income for the first quarter of 2025 was $97.0 million, an increase of 8.1% from $89.7 million in the first quarter of 2024[4][7] - Net sales for the three months ended March 31, 2025, were $1,604.7 million, a 34.9% increase compared to $1,189.4 million in the same period of 2024[26] - Gross profit increased by 22.4% to $580.5 million from $474.3 million year-over-year[26] - Operating income decreased significantly by 90.0% to $13.2 million from $131.5 million in the prior year[26] - Adjusted earnings per common share (diluted) were $0.49, slightly down from $0.50 in the previous year[39] Debt and Liabilities - Total debt at the end of the first quarter of 2025 was $5.1 billion, with consolidated indebtedness less netted cash at $5.0 billion, resulting in a leverage ratio of 3.51 times adjusted EBITDA[13] - Total liabilities rose to $8,579.4 million from $5,412.1 million, indicating a significant increase in debt levels[29] - Total debt as of March 31, 2025, was $5,033.0 million, with consolidated indebtedness less netted cash at $4,958.8 million[53] - The ratio of consolidated indebtedness less netted cash to adjusted EBITDA per credit facility was 3.51 times for the trailing twelve months ended March 31, 2025[51] Acquisition Impact - Operating income decreased to $13.2 million in the first quarter of 2025 from $131.5 million in the same period last year, primarily due to costs associated with the Mattress Firm acquisition[7][10] - Corporate operating expenses rose to $85.0 million in the first quarter of 2025, up from $47.7 million in the same period last year, mainly due to Mattress Firm acquisition costs[13] - The company incurred $114.2 million in acquisition-related costs in Q1 2025, which included $95.4 million in cost of sales[54] - The company recognized $51.9 million in transaction costs associated with the Mattress Firm acquisition in Q1 2025[54] - The company expects to realize $100.0 million in future synergies from the Mattress Firm acquisition for adjusted EBITDA calculations[54] Margins - Gross margin for the first quarter of 2025 was 36.2%, down from 39.9% in the first quarter of 2024, while adjusted gross margin improved to 42.2% from 40.1%[7][10] - Mattress Firm's gross margin for the stub period was 32.2%, with an adjusted gross margin of 35.1%[13] - Adjusted gross profit for Q1 2025 was $677.8 million, reflecting an adjusted gross margin of 42.2%[43] - Adjusted operating income for Q1 2025 was $182.8 million, representing an adjusted operating margin of 11.4%[43] Cash Flow and Assets - Cash and cash equivalents at the end of the period were $111.1 million, down from $117.4 million at the end of 2024[29] - The company reported a net cash used in investing activities of $2,858.9 million, primarily due to acquisitions[31] - Total assets increased to $11,329.7 million as of March 31, 2025, compared to $5,980.4 million at the end of 2024[29] Other Performance Metrics - Tempur Sealy International net sales increased by 5.7% to $304.8 million compared to $288.3 million in the first quarter of 2024, driven by successful new product launches[10] - Adjusted EBITDA for Q1 2025 was $247.9 million, compared to $198.2 million in Q1 2024[48]