Select Comfort Corp. (SCSS, Financial) filed Quarterly Report for the period ended 2009-04-04.
SELECT COMFORT is engaged in the manufacture specialty retailing and direct marketing of premium quality innovative adjustable-firmness beds and other sleep-related products. Select Comfort Corp. has a market cap of $51.2 million; its shares were traded at around $1.13 with and P/S ratio of 0.1. Select Comfort Corp. had an annual average earning growth of 8% over the past 5 years.
As of April 4, 2009, we had cash and cash equivalents of $3.1 million compared with $13.1 million as of January 3, 2009. The $9.9 million decrease in cash and cash equivalents was primarily due to a $23.0 million increase in restricted cash (pursuant to an agreement with the Lenders) and a $9.8 million net decrease in short-term borrowings, partially offset by $24.1 million of cash provided by operating activities (which includes a $23.0 million refund of income taxes associated with the prior years loss).
Cash provided by operating activities for the three months ended April 4, 2009, and March 29, 2008 was $24.1 million and $14.6 million, respectively. The $9.5 million year-over-year increase in cash from operating activities was comprised of a $4.4 million reduction in our net loss compared to the same period one year ago, a $2.6 million increase in adjustments to reconcile net loss to cash provided by operating activities, and a $2.5 million increase in cash from changes in operating assets and liabilities. The year-over-year increase in cash from changes in operating assets and liabilities was primarily due to a reduction in income taxes receivable as we received a $23.0 million cash refund of income taxes resulting from the carryback of 2008 losses to prior years. Other changes in operating assets and liabilities include a current-year increase in accounts payable (timing of payments and extended payment terms), partially offset by a current year increase in accounts receivable (timing of wholesale sales and receipts), a current year increase in prepaid expenses and other assets (timing of rent and advertising obligations), a lower current-year decrease in inventories (both years reflect efforts to align inventories with lower sales volume), and a current year decrease in accrued compensation and benefits (changes in employee severance obligations and timing of bi-weekly payroll cash payments).
Net cash used in investing activities was $24.3 million for the three months ended April 4, 2009 compared with $10.3 million for the same period one year ago. The $14.0 million increase in net cash used in investing activities was principally due to our $23.0 million tax cash refund generated by the prior years loss resulting in an increase in restricted cash in accordance with the terms of our credit facility. During the first three months of fiscal 2009, we invested $1.2 million in property and equipment, compared with $10.3 million for the same period one year ago. During fiscal 2009 we expect to limit our purchases of property and equipment to business-critical expenditures. During the first three months of fiscal 2009 we did not open any new retail stores, compared with seven new retail stores opened during the same period one year ago.
We had outstanding borrowings of $74.3 million and $79.2 million, under the credit facility as of April 4, 2009, and January 3, 2009, respectively. We also had outstanding letters of credit of $5.5 million and $5.9 million as of April 4, 2009, and January 3, 2009, respectively. Outstanding letters of credit reduce the amounts available under the credit facility. At April 4, 2009, and January 3, 2009, $5.2 million and $5.0 million, respectively, were available under this credit facility.
In March 2009, we received a $23.0 million federal income tax refund associated with the carryback of 2008 losses to prior years. Pursuant to an agreement with the Lenders, these funds were placed in a restricted cash account. On April 17, 2009, these funds were used to reduce outstanding debt under the credit facility. On May 8, 2009, the credit facility was amended to include an availability covenant that caps the amount available under the credit facility at the aggregate amount of the Lenders commitments less $15 million, or a net aggregate availability of $70 million. The amount outstanding under this facility, including letters of credits, was approximately $55.9 million as of May 8, 2009, leaving remaining availability of approximately $14.1 million. Cash requirements are expected to increase from current levels during the second quarter, which will require continued support and ac
Read the The complete Report
SELECT COMFORT is engaged in the manufacture specialty retailing and direct marketing of premium quality innovative adjustable-firmness beds and other sleep-related products. Select Comfort Corp. has a market cap of $51.2 million; its shares were traded at around $1.13 with and P/S ratio of 0.1. Select Comfort Corp. had an annual average earning growth of 8% over the past 5 years.
Highlight of Business Operations:
The $28.6 million net sales decrease compared with the same period one year ago was comprised of the following: (i) a $21.9 million net decrease in sales from our company-owned retail stores, comprised of a $17.2 million decrease from comparable-stores and a $4.7 million decrease from the net decline in the number of stores we operated; (ii) a $4.4 million decrease in direct sales; and (iii) a $3.9 million decrease in E-Commerce channel sales; partially offset by, (iv) a $1.6 million increase in wholesale sales.As of April 4, 2009, we had cash and cash equivalents of $3.1 million compared with $13.1 million as of January 3, 2009. The $9.9 million decrease in cash and cash equivalents was primarily due to a $23.0 million increase in restricted cash (pursuant to an agreement with the Lenders) and a $9.8 million net decrease in short-term borrowings, partially offset by $24.1 million of cash provided by operating activities (which includes a $23.0 million refund of income taxes associated with the prior years loss).
Cash provided by operating activities for the three months ended April 4, 2009, and March 29, 2008 was $24.1 million and $14.6 million, respectively. The $9.5 million year-over-year increase in cash from operating activities was comprised of a $4.4 million reduction in our net loss compared to the same period one year ago, a $2.6 million increase in adjustments to reconcile net loss to cash provided by operating activities, and a $2.5 million increase in cash from changes in operating assets and liabilities. The year-over-year increase in cash from changes in operating assets and liabilities was primarily due to a reduction in income taxes receivable as we received a $23.0 million cash refund of income taxes resulting from the carryback of 2008 losses to prior years. Other changes in operating assets and liabilities include a current-year increase in accounts payable (timing of payments and extended payment terms), partially offset by a current year increase in accounts receivable (timing of wholesale sales and receipts), a current year increase in prepaid expenses and other assets (timing of rent and advertising obligations), a lower current-year decrease in inventories (both years reflect efforts to align inventories with lower sales volume), and a current year decrease in accrued compensation and benefits (changes in employee severance obligations and timing of bi-weekly payroll cash payments).
Net cash used in investing activities was $24.3 million for the three months ended April 4, 2009 compared with $10.3 million for the same period one year ago. The $14.0 million increase in net cash used in investing activities was principally due to our $23.0 million tax cash refund generated by the prior years loss resulting in an increase in restricted cash in accordance with the terms of our credit facility. During the first three months of fiscal 2009, we invested $1.2 million in property and equipment, compared with $10.3 million for the same period one year ago. During fiscal 2009 we expect to limit our purchases of property and equipment to business-critical expenditures. During the first three months of fiscal 2009 we did not open any new retail stores, compared with seven new retail stores opened during the same period one year ago.
We had outstanding borrowings of $74.3 million and $79.2 million, under the credit facility as of April 4, 2009, and January 3, 2009, respectively. We also had outstanding letters of credit of $5.5 million and $5.9 million as of April 4, 2009, and January 3, 2009, respectively. Outstanding letters of credit reduce the amounts available under the credit facility. At April 4, 2009, and January 3, 2009, $5.2 million and $5.0 million, respectively, were available under this credit facility.
In March 2009, we received a $23.0 million federal income tax refund associated with the carryback of 2008 losses to prior years. Pursuant to an agreement with the Lenders, these funds were placed in a restricted cash account. On April 17, 2009, these funds were used to reduce outstanding debt under the credit facility. On May 8, 2009, the credit facility was amended to include an availability covenant that caps the amount available under the credit facility at the aggregate amount of the Lenders commitments less $15 million, or a net aggregate availability of $70 million. The amount outstanding under this facility, including letters of credits, was approximately $55.9 million as of May 8, 2009, leaving remaining availability of approximately $14.1 million. Cash requirements are expected to increase from current levels during the second quarter, which will require continued support and ac
Read the The complete Report
