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Sealy on track to achieve 10% adjusted EBITDA growth in fiscal 2010
By Jennifer Lanning Drey
Portland, Ore., June 29 - Sealy Corp.'s financial results for the second quarter of fiscal 2010 position the company well for achieving its goal of 10% growth in adjusted EBITDA for the full fiscal year, Larry Rogers, Sealy's chief executive officer, said during the company's quarterly earnings conference call held Tuesday.
Sealy posted second-quarter adjusted EBITDA of $38.9 million, which was down from $41.6 million in the same period of 2009. However, Rogers said the 6.6% declined reflected the anticipated impact from investments made in new products.
"These investments will set the stage for gains in adjusted EBITDA dollars for the remainder of 2010," he said.
Rogers also noted during the call that Sealy remained focused on deleveraging its balance sheet during the second quarter.
In March, Sealy took advantage of a provision in its senior note agreement permitting the company to redeem $35 million principal amount of its senior notes.
The company's net-debt-to-adjusted-EBITDA leverage ratio excluding its PIK notes was 3.07 times at May 30. The ratio was down from 4.03 times at May 31, 2009, Rogers said.
Sealy had debt net of cash of $729 million at May 30, which was a $31.9 million improvement from the end of the second quarter of 2009.
"Over the quarter, we further demonstrated our focus on deleveraging as we completed the redemption of $35 million, or 10%, of our 10 7/8% notes," Jeff Ackerman, Sealy's chief financial officer, said during the call.
Sealy's second-quarter net sales were $316.5 million, representing a more than 6% increase over the same prior-year period. It was the company's third consecutive quarter of year-over-year sales growth.
Sealy is a bedding manufacturer based in Trinity, N.C.
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