Mattress Firm Holding Corp. (NASDAQ: MFRM) today announced its financial results for the fiscal first quarter (13 weeks) ended May 1, 2012. Net sales for the first quarter increased 38.1% to $209.8 million, compared to $151.9 million in the first quarter of 2011, driven by comparable-store sales growth of 16.1% and an increase in store units from new store openings and acquisitions. The Company reported first-quarter GAAP earnings per diluted share (“EPS”) of $0.29. Excluding $1.2 million in acquisition-related costs attributable to the acquisition of Mattress Giant, which closed on May 2, 2012, first-quarter adjusted earnings per diluted share (“adjusted EPS”) were $0.31 compared with $0.05 in the first quarter of 2011.
On May 2, 2012, subsequent to the end of the fiscal first quarter, Mattress Firm completed the acquisition of the equity interests of Mattress Giant for approximately $44 million. Mattress Giant is a specialty mattress retailer with approximately 180 stores in certain Texas and Florida markets where the Company also operates 240 Mattress Firm stores. The acquisition is expected to advance the Company’s market-level profitability model that is centered on the benefits of increasing its “relative market share” in a given market. The Company benefited from its accelerated efforts of an initial rebranding and transition of the acquired stores in advance of the Memorial Day holiday. As a result, the vast majority of the acquired stores operated during the Memorial Day holiday (1) with Mattress Firm’s product offerings and its unique “Comfort by Color” merchandising approach, (2) utilizing Mattress Firm’s point of sale systems, (3) with initial training of substantially all of the former Mattress Giant sales associates, (4) with temporary signage in place where allowable and (5) with significant advertising investment and Mattress Firm’s brand presence. After Labor Day, permanent signage as well as required renovations to bring the stores up to Mattress Firm’s standards will be undertaken and are expected to be substantially complete by the start of fiscal year 2013.
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