Ann: Appendix 4C - quarterly, page-80

Hi guys/Girls are we aware of this!



Tempur Sealy _Stock Tanks After It Walks Away From Its Biggest Retailer

Investors were bailing on Tempur Sealy on Monday after the company decided it will no longer sell its mattresses at its biggest retailer.
Tempur Sealy said in a news release that it is terminating all its contracts with Mattress Firm after the two companies failed to reach an agreement.
Shares of Tempur Sealy plunged by 30% to $43.89 on Monday.
Tempur Sealy, which makes Tempur-Pedic and Sealy mattresses, looks to Mattress Firm stores for about one fifth of its sales. Mattress Firm waspurchased by Steinhoff for $3.8 billion last year and has some 3,500 locations across the country.
However, Tempur Sealy said it was unwilling to make "significant economic concessions" that represented "considerable" changes to the existing agreements. It expects to stop doing business with Mattress Firm sometime this quarter.
"We are extremely surprised by this development given the mutual importance of each company to the other," said Instinet analyst Jessica Schoen Mace in a note downgrading the stock.
Tempur Sealy CEO Scott Thompson defended the decision, saying it will allow the company to "immediately reorient our employees and resources to support retail partners that exhibit a long-term commitment to Tempur Sealy's brands." The company's sales at Mattress Firm stores, which includes Sleepy's locations, also slipped 11% in 2016.
Yet, breaking ties with the retailer altogether means that "about $750 million in revenues now seems in doubt," said Raymond James analyst Budd Bugatch.
The Kentucky-based company is projecting that 2016 sales will have slipped 1% to $3.13 billion, which is in line with analyst estimates. It is also calling for adjusted earnings in the range of $519 to $522 million.