Latest news with #SealyPosturepedic
Yahoo
4 days ago
- Business
- Yahoo
SGI Q1 Earnings Call: Revenue Miss, Guidance Cut, and Tariff Mitigation Plans Detailed
Bedding manufacturer Somnigroup (NYSE:SGI) missed Wall Street's revenue expectations in Q1 CY2025, but sales rose 34.9% year on year to $1.6 billion. Its non-GAAP EPS of $0.49 per share was 5.1% above analysts' consensus estimates. Is now the time to buy SGI? Find out in our full research report (it's free). Revenue: $1.6 billion (34.9% year-on-year growth) Adjusted EPS: $0.49 vs analyst estimates of $0.47 (5.1% beat) Adjusted Operating Income: $182.8 million vs analyst estimates of $185.4 million (11.4% margin, 1.4% miss) Management lowered its full-year Adjusted EPS guidance to $2.47 at the midpoint, a 11.6% decrease Operating Margin: 0.8%, down from 11.1% in the same quarter last year Market Capitalization: $13.6 billion Somnigroup's first quarter performance was shaped by the initial integration of Mattress Firm and the ongoing launch of new product lines, particularly the Sealy Posturepedic collection in North America. CEO Scott Thompson cited 'continued strong performance in our international business' and highlighted solid mid-single-digit sales growth in key markets, despite the impact of foreign exchange. Management also addressed weaker-than-expected U.S. consumer demand over the President's Day period and a challenging market backdrop. The company's operational focus included expanding distribution, accelerating private label initiatives, and streamlining logistics, all of which were intended to counteract industry headwinds and drive market share gains. Looking forward, Somnigroup's revised outlook reflects lowered expectations for the U.S. bedding market, with management now projecting a mid-single-digit industry decline for the year. CFO Bhaskar Rao attributed the guidance cut primarily to a 'rapid change in consumer confidence or sentiment in the U.S.,' describing it as volatile and policy-driven. The company plans to offset new tariff costs by combining supplier negotiations and price increases, which are set to take effect in the third quarter. Management emphasized upcoming marketing campaigns and the ongoing rollout of the Sealy collection as potential drivers for a modest second-half improvement, though they cautioned that overall industry demand is likely to remain subdued. Management discussed the integration of Mattress Firm, evolving market conditions, and the company's response to tariff developments as major themes impacting the quarter. International business momentum: The international segment, led by the Tempur brand, delivered mid-single-digit sales growth on a reported basis and high single digits in constant currency. Management highlighted the success of new Tempur products and an expanded price range that increased distribution opportunities and market reach. Sealy Posturepedic launch progress: The comprehensive rebranding and rollout of the Sealy Posturepedic collection in North America was a major operational focus. Early locations showed encouraging results, and the product is expected to be widely available by Memorial Day, supported by a national advertising campaign. Mattress Firm integration and synergies: Somnigroup completed the first phase of integrating Mattress Firm, focusing on leadership alignment, cost reduction, and logistics optimization. The company increased its near-term synergy target for 2025 to $15 million and is leveraging Mattress Firm's home delivery network for enhanced operational efficiency. Tariff mitigation strategy: Facing new tariffs, Somnigroup acted to reduce exposure through supplier changes and cost-sharing arrangements. The remaining impact will be addressed by a 2% price increase in North America, effective in the third quarter, with management expecting the combination of actions to fully offset the tariff cost. Advertising and merchandising changes: Somnigroup is doubling down on advertising scale, aiming for more effective campaigns by aligning messaging and leveraging buying power. Mattress Firm is also expanding its assortment through new vendor partnerships and increasing the share of Tempur Sealy-manufactured products, including an expanded private label offering. Somnigroup's updated outlook centers on cautious U.S. consumer sentiment, cost pressures from tariffs, and the pace of synergy realization from the Mattress Firm acquisition. Consumer confidence uncertainty: Management attributed the lower guidance to a double-digit decline in U.S. consumer confidence, which it sees as the main determinant of short-term demand. While this index is considered highly volatile and policy-sensitive, any recovery in sentiment could improve sales trends. Tariff pass-through and cost management: The company expects to manage increased tariff-related costs by shifting suppliers and raising prices. While these actions are intended to neutralize the margin impact, there is a lag in implementation, leading to a temporary headwind in the second quarter. New product and marketing initiatives: The ongoing rollout of the Sealy Posturepedic collection and the reimagined Mattress Firm advertising campaign are expected to drive incremental demand in the second half. Management is also focused on merchandising changes and expanded vendor partnerships to enhance store traffic and average order value. In the coming quarters, the StockStory team will be watching (1) the pace of synergy realization and operational improvements following the Mattress Firm acquisition, (2) the market response to new product launches and expanded vendor partnerships, and (3) the effectiveness of tariff mitigation and price increase strategies. Progress on these fronts, as well as shifts in U.S. consumer confidence, will be key indicators of future performance. Somnigroup currently trades at a forward P/E ratio of 22.7×. Should you double down or take your chips? See for yourself in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. 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The Guardian
25-04-2025
- Politics
- The Guardian
Watching the election from afar, I can't help but wonder – is this really the best Australia can do?
Informed by impeccable sources that the federal election would be held on 12 April, I booked a holiday to Italy, departing on the 14th. Then Cyclone Alfred swung in toward southern Queensland and the election was delayed. Damn it! The tickets were non-refundable but – thank Buddha! – my presence is no longer required on the campaign planes and buses. A nod from the boss, and away I slunk. So it is that, for the first time in decades, I am consuming this election like most voters – intermittently through media, social and otherwise, and only when I can't avoid it. From this distance it is even clearer what was obvious at home. This is the most dismal election in decades. Far better to televise the papal conclave. At least dramatists have seen potential in that. Only one line stays in my mind. Peter Dutton telling Anthony Albanese that he couldn't lie straight in bed. It sticks because it is true. Throughout this campaign, the prime minister has held up a Medicare card, telling the good voters that under Labor they will need only the green card, not their credit card, to see a doctor. And every single Australian already knows that is not true. But Dutton's offerings, once stretched across the Sealy Posturepedic, are no less bent. A nuclear policy whose costings demand mass shrinkage in industrial energy use; a defence spend that will depend on higher income taxes, as Dutton simultaneously claims an 'aspiration' to index tax bands to manage the effects of bracket creep. (Tbh, Labor is not even pretending to consider that most basic piece of tax reform). Labor, so we learn daily from the polls, will come home on 3 May. At worst it should have enough to cobble up a minority government without Albanese and Adam Bandt having to walk down the aisle. Though that I would like to see. All usual caveats. Anything can happen. Many remain undecided or soft (why wouldn't they be?). Et cetera. The depth of dismality (my word, but feel free to use it) stems from this: Albanese and Dutton, and a reasonable proportion of the people around them, know that Australia is slowly being cooked. They know that without fundamental, sensible reforms, Australia is on the early stages of the structural path that leads ultimately towards the malaise that has befallen America. Albanese, Dutton and those around them have concluded that pushing said reforms presents risks to their current employment or their hopes of future advances. Call that modern politics. Former Treasurer secretary Ken Henry calls it a 'wilful act of bastardry'. And he's right to call it intergenerational robbery. So we mark time. Unless the incoming pope declares Catholicism compulsory and birth control verboten, Australia will never again be a society that is not weighted towards the aged. Jobs in the care economy, often taken up by migrants from poorer countries, are important jobs. But despite important pay increases supported by Labor, they remain relatively lowly paid. The people working them face a potential lifetime of being cut out of the heavily distorted housing market. So will anyone else unable to take up former treasurer Joe Hockey's famously glib advice to 'get a good job that pays good money'. Sign up for the Afternoon Update: Election 2025 email newsletter In time those who arrive poor, and millions of others who are not being helped along by family money, will feel themselves fall into a multi-generational underclass. Australian egalitarianism will have gone the way of the White Australia policy and roll-yer-own tobacco. Sign up to Afternoon Update: Election 2025 Our Australian afternoon update breaks down the key election campaign stories of the day, telling you what's happening and why it matters after newsletter promotion Does this matter? Yup. Trump's rise in America comes from a series of fundamental societal shifts. For decades the American 'heartland' was dying, a trend accelerated by the shift – 'offshoring' – of manufacturing to China, to Mexico and elsewhere. Between 2010 and 2020, the US census records more than half the counties in America LOST population. That drift was largest in the so-called red states – traditional Republican party country in the midwest, great plains and the south. The Trump contest was played out most obviously with the Democrats, but the political movement most extinguished were traditional, conservative Republicans. They are now almost gone from American public life. What drives the 'Make America Great Again' movement, for all its contradictions and follies, is the restoration of hope in lives that had lost it. That hope will take some time to crumble before Americans realise the postwar manufacturing boom is never coming back, no matter what self-defeating games Trump plays with tariffs. This is not to make a case for Trump but to sound a warning. Australia is engaged in a structural drift that will divide us into the property-holding and property-deprived classes. None of the political offerings does more than play with the edges, and half of them – super for deposits, shared equity schemes, etc – simply add to the demand side, pushing prices still higher. Once that hope is lost, the ground will become ripe for populism, and divisions will start to bake in. The time to get moving is now. But it is already clear 2025 is not the year, or the cycle, that will see it happen. Sometimes taking a break is useful, just to see what's staring you in the face. Hugh Riminton is national affairs editor at Channel 10
