Sleep Number Corporation (NASDAQ:SNBR) Q3 2020 Earnings Conference Call - Final Transcript

Oct 14, 2020 • 05:00 pm ET


Sleep Number Corporation (NASDAQ:SNBR) Q3 2020 Earnings Conference Call - Final Transcript


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Welcome to Sleep Number's Third Quarter 2020 Earnings Conference Call. [Operator Instructions] Today's call is being recorded. [Operator Instructions]

I would like to introduce Dave Schwantes, Vice President of Finance and Investor Relations. Thank you. You may begin.

Dave Schwantes

Good afternoon and welcome to the Sleep Number Corporation third quarter 2020 earnings conference call. Thank you for joining us. I am Dave Schwantes, Vice President of Finance and Investor Relations. With me today, are Shelly Ibach, our President and CEO; and David Callen, our Chief Financial Officer.

This telephone conference is [Technical Issues] Please refer to the details in our news release to access the replay. Please also refer to our news release for a reconciliation of certain non-GAAP financial measures and supplemental financial information included in the news release or that may be discussed on this call.

The primary purpose of this call is to discuss the results of the fiscal period just ended. However, our commentary and responses to your questions may include certain forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties outlined in our earnings news release and discussed in some detail in our annual report on Form 10-K and other periodic filings with the SEC. The Company's actual future results may vary materially.

I will now turn the call over to Shelly for her comments.

Shelly R. Ibach

Good afternoon, and thank you for joining our 2020 third quarter earnings call. My SleepIQ score was 88 last night. Quality sleep has the power to improve lives and because of our team's dedication to our mission and our relentless focus on innovation, Sleep Number is at the forefront of delivering this life-changing benefit. We have now improved nearly 13 million lives and counting. This is particularly important in this time of extreme stress and disruption in everyone's lives. In the face of significant ambiguity caused by the pandemic, the Sleep Number team is helping our customers achieve an unparalleled sleep experience with our 360 smart beds.

I am grateful, every day, for our teams tenacity, ingenuity and the care they show to one another and [Technical Issues] a purpose-driven Company, based on individuality and well-being. Our years of pacing and prioritizing strategic investments have contributed to our ability to deliver superior performance, despite simultaneous health and economic challenges. We are well positioned for continued profitable growth and significant shareholder value creation.

Our third quarter 2020 performance provides undeniable evidence of the strength, resilience and sustainability of the differentiated consumer innovation strategy and efficient business model we have built, since transitioning to all 360 smart beds in 2018.

For the third consecutive year, our third quarter results reflect double-digit demand growth, including 16% growth this year. Record third quarter financial results include, net sales of $531 million, up 12% versus prior year with an 11% comp gain; net earnings per share were $1.79, up 90%; net operating profit was $70 million or 13% of net sales, an increase of 78%; year-to-date cash flows were $287 million,