Letter to Shareholders Urges Re-Election of Board Nominees
MINNEAPOLIS--(BUSINESS WIRE)--Mar. 31, 2015--
Select Comfort Corporation (NASDAQ:SCSS) today announced that it has
filed definitive proxy materials with the Securities and Exchange
Commission in connection with its 2015 Annual Meeting of Shareholders,
which is scheduled to be held on May 22, 2015. Select Comfort
shareholders of record as of March 30, 2015 will be entitled to vote at
the Annual Meeting.
In conjunction with the definitive proxy filing, Select Comfort is
mailing a letter to shareholders urging them to use the WHITE proxy card
to vote “FOR ALL” of Select Comfort’s independent, experienced and
highly qualified director nominees to the Board of Directors, Daniel I.
Alegre, Stephen L. Gulis, Jr. and Brenda J. Lauderback.
The following letter to Select Comfort shareholders highlights the
Company’s strong financial performance and superior shareholder returns
being driven by its transformational, consumer-driven strategy.
Together, the Board and management team have prioritized three growth
and profitability drivers: increasing demand, leveraging the vertically
integrated business model and efficiently deploying capital.
The full text of the letter is below:
March 31, 2015
Dear Fellow Shareholder,
At Select Comfort’s upcoming Annual Meeting of Shareholders, which is
scheduled to be held on May 22, 2015, you will be making important
decisions regarding the future of your Company.
This year your vote is especially important, given the contested
election of directors. Specifically, Blue Clay Capital Partners CO III
LP (together with its affiliates and related parties, “Blue Clay”),
which beneficially owns approximately 2% of Select Comfort’s outstanding
shares, has launched a proxy contest and is attempting to replace two
incumbent Select Comfort directors with its own nominees. Consistent
with our diligent governance practices, your Board’s Nominating and
Governance Committee along with the Company’s President and CEO
interviewed Blue Clay’s two nominees, and following due consideration,
the Company’s full Board concluded that Blue Clay’s nominees are not
qualified to serve on Select Comfort’s Board. Moreover, in its
filings and recommendations to Select Comfort’s Board and management
team, Blue Clay has advocated risky and poorly conceived changes to the
Company’s successful strategy — accordingly, we urge you to use the
enclosed WHITE proxy card to vote FOR Select Comfort’s nominees.
As evident from our 2014 results, this is an exciting time for the
Company, with accelerating consumer acceptance and operating
performance, in addition to above-peer return on invested capital
(ROIC). It is also a delicate and complex period of evolution and
transformative change that requires a high level of expertise, judgment,
acumen and experience to oversee.
We are committed to maintaining a top-flight and diverse board, which
has the skill sets and capacity to evolve in a rapidly changing
environment and the courage to hold management accountable for
delivering on our high ambitions. In that vein, we have taken seriously
our responsibility to recommend the three board nominees who are most
qualified and likely to contribute to maximizing value creation for all
Select Comfort shareholders.
WE URGE SHAREHOLDERS TO VOTE THE WHITE
PROXY CARD TO:
— ELECT SELECT COMFORT’S NOMINEES TO SUPPORT THE CONTINUED EXECUTION
OF OUR TRANSFORMATIONAL STRATEGY
— REJECT BLUE CLAY’S ATTEMPTS TO FORCE RISKY AND POORLY CONCEIVED
CHANGES TO SELECT COMFORT’S SUCCESSFUL STRATEGY
Your vote is important in this election and we urge you to vote so that
your voice is heard at this year’s Annual Meeting.
Support Select Comfort’s proven strategy by using the WHITE
proxy card to re-elect all three independent, experienced and highly
qualified Select Comfort directors: Daniel I. Alegre, Stephen L. Gulis,
Jr. and Brenda J. Lauderback.
Select Comfort’s differentiated growth strategy, developed and
implemented by your Board and management team, is driving performance
and positioning the Company for sustained profitable growth. The
opportunity for continued revenue and profit growth is significant, as
Select Comfort advances its strategic initiatives and as its investments
in the consumer-driven innovation strategy mature in the coming years.
Blue Clay’s inexperienced Board nominees are advocating risky changes to
the Company’s strategies based on arbitrary targets, without
understanding the negative effects of these changes on the business and
shareholder value. Shareholders should be concerned about the risk posed
to their investment by the detrimental consequences of Blue Clay’s
attempts to force unwarranted changes to Select Comfort’s
transformational strategy at a critical time.
SELECT COMFORT’S CURRENT BOARD AND MANAGEMENT TEAM
HAVE
DELIVERED STRONG PERFORMANCE
Select Comfort’s current Board and management team have led the
development and implementation of the Company’s progressive, long-term
growth strategy, while prudently managing operating risk and efficiently
deploying capital. This strategy has delivered:
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Total Shareholder Return of 312% over the five years ending with
fiscal 2014, well above the NASDAQ Stock Market Index, the S&P 500
Index and the S&P 400 Specialty Store Index.
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More than $115 million returned to shareholders over the past 11
quarters through our share repurchase program, representing 124% of
free cash flows. The Company paid an average price per share of
$22.40, well below our ending stock price of $33.97 per share on March
30, 2015.
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Full-year 2014 results including:
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Record net sales of $1.16 billion, an increase of 20% over 2013,
including 12% Company-controlled comparable sales growth
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Earnings per diluted share of $1.25, an increase of 16% compared
to $1.08 in 2013
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Return on invested capital of 15% (50% greater than our 10%
weighted average cost of capital) on a growing invested capital
base
Your Board and management team are committed to continued shareholder
value creation.
We expect to more than double our 2014 EPS over the next five years,
to $2.75 in 2019 (17% CAGR), by increasing consumer demand, leveraging
our vertically integrated business model and deploying capital
efficiently.
CONSUMER-DRIVEN INNOVATION STRATEGY AND CLEAR COMPETITIVE ADVANTAGES
ARE
PRODUCING STRONG FINANCIAL RESULTS
Your Board and management team have positioned the Company to deliver
sustainable, superior shareholder returns by pursuing a consumer-driven
innovation strategy that leverages our vertically integrated business
model. This strategy prioritizes strengthening our three unique
competitive advantages to deliver sustainable profitable growth. These
advantages include: proprietary sleep innovations, ongoing customer
relationships and exclusive distribution.
- Proprietary Sleep Innovations: Smart technology is at the
forefront of Select Comfort’s strategy. In an industry characterized by
commodity merchandise and promotional pricing, the Board and management
have positioned the Company as the sleep innovation leader by offering
technology-driven products that resonate with consumers who seek the
benefits of improved sleep. In the past two years, we have introduced a
completely new portfolio of Sleep Number beds, which combine our
proprietary SleepIQ sensor technology with DualAir adjustability for the
individual knowledge to adjust for your best sleep. In addition, we
introduced innovations such as the Sleep Number x12 bed, DualTemp layer
and the FlexFit adjustable base series featuring Partner Snore
technology. The Company’s innovations have won numerous
technology awards and the Sleep Number Bed was rated “#1 for comfort and
back pain relief”, rated as a “best buy” and rated as “best bed for
couples” by a leading consumer magazine in the past year.
The consumer’s response to these innovations resulted in 31% net
sales growth and 63% earnings per share growth for the second half of
2014 versus the prior year period. Select Comfort’s innovations
have also helped drive growth in both average revenue per mattress unit
(ARU), which grew by 13%, and Company-controlled mattress unit sales,
which increased 8% in 2014.
- Ongoing Customer Relationships: As both the manufacturer and
retailer, Sleep Number develops life−long relationships with its
customers. The Company’s smart technology and connectivity are deepening
these relationships. In addition, the significant sleep data and daily
insights are fueling future innovation. “Repeat and referral” sales
from existing customers continue to be an important source of growth,
constituting more than 30% of net sales.
- Exclusive Distribution: Sleep Number stores offer our customers
a differentiated, value-added experience, which results in retail
leading store productivity. Our sleep professionals focus on
meeting customers’ individual sleep needs with our proprietary products
and sales process. Our productive, award winning store design
complements the sales process and results in consistent high conversion.
Our distribution strategy is well informed, highly tested and built for
agility as consumers’ shopping behavior shifts toward mobile and digital
interaction. Exclusive distribution is the foundation for sustainable,
profitable growth in our advantaged business model. Annual sales per
comparable store have increased to $2.33 million, an increase of more
than 80% from 2010; sales-per-square-foot productivity ranks in the top
10 of U.S. specialty retail brands1, at over
$1,000 per foot; and average annual four-wall profitability has grown to
approximately $800,000. We are on track to achieve our goal to
grow average sales per comparable store to more than $3 million with
four-wall store profit of $1.1 million or more.
SELECT COMFORT’S BALANCED CAPITAL ALLOCATION STRATEGY RETURNS CAPITAL
TO
SHAREHOLDERS AND SUPPORTS GROWTH
Select Comfort’s Board and management team’s capital allocation strategy
is focused on three priorities: funding organic growth, maintaining
financial flexibility and returning cash to shareholders.
- Return on Investment: While increasing its average invested
capital base through investment in growth opportunities, the Company
generated a 15% ROIC in 2014, 50% greater than the Company’s weighted
average cost of capital of 10%. This ROIC exceeds returns earned by
direct competitors2 and other home furnishing companies3
and demonstrates the strength of the investment decisions being made by
your management team and Board. The Company’s long-term guidance
includes an expectation for at least mid-teen ROIC going forward.
- Return of Capital to Shareholders: Over the past 11 quarters
through the fourth quarter of fiscal 2014, Select Comfort has returned
$115 million to shareholders through its ongoing share repurchase
program at an average price of $22.40 (more than 30% below its current
stock price), representing 124% of free cash flows.
Furthermore, following the third quarter of 2014, the Company announced
an increase in its outstanding share repurchase authorization to $250
million and a significant increase in the rate of share repurchase
activity, which began in the fourth quarter of 2014. The Company expects
to fund additional share repurchases through free cash flow and
available cash.
- Investing to Support Growth: One of the Company’s top
priorities in 2015 is to successfully implement an Enterprise Resource
Planning (ERP) system. The ERP implementation, which involves replacing
much of Select Comfort’s 20-year-old core transactional operating
systems, is critical to support our vertically integrated business with
efficiency, stability, and scalability. Periods of high consumer demand
for our products, as we experienced in 2014, strain legacy
infrastructure, create inefficiencies in our supply chain and adversely
impact customer experience. These constraints underscore the importance
of building new capabilities and agile systems.
The implementation of the ERP system will enable the continued
successful execution of Select Comfort’s strategy. In 2015, the Company
plans to invest approximately $30 million in the ERP system and incur
approximately $11 million of implementation costs. The scope and risks
of this implementation heighten our need for financial flexibility and
validate our current cash position. While this system is primarily an
enabler of growth, the Company expects to realize significant cost
savings and cost avoidances in the years following the completion of the
ERP implementation. These savings are expected to be realized primarily
through supply chain improvements and are incorporated in Select
Comfort’s long-range outlook of more than doubling earnings per share to
$2.75 in five years, with return on invested capital at least in the
mid-teens.
- Balance Sheet Strength to Retain Flexibility: We are committed
to retaining sufficient balance sheet strength to provide adequate
liquidity to meet Select Comfort’s operating needs, including $233
million in operating lease commitments, as well as support the pivotal
ERP implementation, and continue to invest in our strategic growth
initiatives (including 5% to 7% new store growth annually). Our strong
balance sheet will also enable us to pursue strategic opportunities as
they arise.
BLUE CLAY’S PROPOSAL TO DOUBLE STORE COUNT DEMONSTRATES A LACK OF
UNDERSTANDING
OF SELECT COMFORT’S BUSINESS MODEL AND WOULD IMPAIR FINANCIAL PERFORMANCE
X Blue Clay asserts that any concern around sales
cannibalization is unwarranted: “We believe that the Company should immediately
undertake a capital expenditure strategy focused on aggressive new store
development …”4 In materials shared with Select Comfort in
January 2015, Blue Clay stated that 900 stores “seems reasonable based
on a competitor’s approach” and asserts that “any concern around
cannibalization is unwarranted.” Blue Clay’s materials suggest that new
stores achieving sales near breakeven are acceptable due to “significant
cushion for any downturn.”
Implications: An immediate capital expenditure strategy to double
store count regardless of sales cannibalization would reduce the
productivity and profitability of stores while adding significantly to
the Company’s fixed cost structure. The sales cannibalization resulting
from a store development approach that “seems reasonable” to Blue Clay
would, in fact, seriously impair the financial performance of the
business and Select Comfort’s ability to grow in a sustainable and
profitable manner. Blue Clay’s proposed actions would also reduce
agility to respond to changing consumer shopping behaviors, which is of
increasing importance.
IN CONTRAST, SELECT COMFORT’S STRATEGIC APPROACH TO MARKET DEVELOPMENT
INCLUSIVE OF NEW STORE DEVELOPMENT IS DISCIPLINED, TESTED AND PROVEN,
WHILE ALSO
DELIVERING RETAIL-LEADING COMPARABLE SALES AND
PRODUCTIVITY
- Market Development: Our disciplined market-based development
approach results in market share gains and profitable growth. In 2011,
we introduced an ‘Aggressive Growth’ strategy designed to accelerate and
sustain market share in 13 of our large and underpenetrated markets.
These markets represented about one-third of U.S. mattress sales, and we
are on track to launch our tenth market in 2015, with elements of this
strategy already deployed in all markets. The objective of our
Aggressive Growth strategy is to double market share in these markets in
a sustainable manner within three to four years post-launch. Launching
an Aggressive Growth market requires investments in both new and
existing stores and heavy up-front local advertising spend to support
sales growth. Our multi-faceted Aggressive Growth strategy is carefully
calibrated to deliver optimal return on investment and sales growth
market-by-market in a sustainable manner. In the four markets
launched in 2011, Select Comfort has doubled market share and increased
four-wall market profit by 168%, and the other markets are on track to
achieve these goals.
- Store Productivity: The Company’s approach to store site
selection combines art with science utilizing our proprietary Customer
Prospecting Model to evaluate each market. This process results in
increased productivity of existing stores while adding new stores with
cannibalization rates of less than 20%. Since 2011, the Company has been
optimizing its national real estate footprint through new stores,
relocations from mall to non-mall and within malls. During this time, we
have improved more than 70% of the Company’s existing store portfolio,
including location, size and store design. Our strategy, which includes
rigorous tests of site characteristics, is delivering a strong return on
investment and high store productivity and profitability. Our target
over the next five years is 590 to 650 stores. As of January 3, 2015,
the Company had 463 retail stores in 47 states, including 40% in
non-mall locations. We continue to achieve a payback on our new store
actions of approximately two years and ROIC 50% higher than the
Company’s weighted average cost of capital.
BLUE CLAY’S PROPOSAL TO SIGNIFICANTLY CUT ADVERTISING SPEND INCREASES
RISK TO
SALES AND DEMONSTRATES LACK OF UNDERSTANDING OF
SELECT COMFORT’S VERTICALLY
INTEGRATED BUSINESS MODEL
X Blue Clay advocates cutting advertising spend as a
percent of net sales by over 25%5 and
eliminating all TV advertising. In materials shared with Select
Comfort in January 2015, Blue Clay stated advertising expense should be
“...held constant until it reaches 10% of sales,” and asserted that
“advertising and G&A expense can be further reduced in downturn.”
Additionally, during an interview with members of the Select Comfort
Board, Blue Clay nominee, Brian Spaly, stated “TV is not right for the
Company.” Brian Spaly’s idea of cutting TV advertising spend ignores
the fact that TV advertising has proven to be the Company’s highest ROI
advertising category.
- Advertising is our engine. As both the retailer and
manufacturer, and the exclusive distributor of our differentiated
proprietary products, advertising is our engine. Our advertising
strategy increases brand awareness and consideration, as well as raising
consumer demand and traffic. We analyze and prioritize our media spend
on a return on investment basis. Over the past two years, we have built
an econometric model that contributes to the predictability of
efficiently allocating media spend based on consumer behavior. We are
continuing to advance our marketing effectiveness, and improve media
return on investment by optimizing our media mix and investment and
leveraging our growing scale. In 2014, a 9% increase in media spend
helped to drive a 20% increase in sales, while providing 140 basis
points of leverage.
We believe shareholders should be concerned about the negative impact
on sales and shareholder value of Blue Clay’s plans to significantly cut
advertising spend. Reducing advertising spending would be
especially troublesome in combination with the aggressive and immediate
store expansion plans advocated by Blue Clay.
SELECT COMFORT’S HIGHLY QUALIFIED DIRECTORS ARE THE RIGHT CHOICE TO
OVERSEE THE
CONTINUED EXECUTION OF THE COMPANY’S STRATEGY
- Progressive Board: Select Comfort’s Board has regenerated
itself through a progressive and diligent succession planning process.
The Board is comprised of nine highly qualified directors with diverse
experience and expertise in strategic and financial disciplines and
industries that are relevant and important to the Company’s business and
continued success. Eight Board members are independent, including the
Chairman, and one third of the Board are women. The Board’s thoughtful
succession planning process has brought in four new directors over the
past four years, who have diverse experience that is complementary to
the composition of the Board. Collectively, the Board and executive
officers beneficially own 3.4% of the Company’s shares, significantly
more than Blue Clay’s ownership position.
- Recognized Governance: The Company’s high governance standards
were recognized by Institutional Shareholder Services (ISS) in its
latest annual review, which ranked Select Comfort in the top decile
category for governance. In 2014, ISS recommended that shareholders vote
in favor of the Company’s advisory “say-on-pay” proposal and the
proposal received support from 92% of shares voted. The Board regularly
reviews its policies to ensure that long-term shareholder interests are
well-represented, including the effectiveness and competitiveness of the
compensation program.
- Proactive Shareholder Outreach: The Company has a commitment
and a track record of soliciting and considering shareholder input.
Select Comfort both seeks and welcomes shareholder communications and
viewpoints. In keeping with our commitment and shareholder engagement
practices, the Board Chair and management conducted a proactive
shareholder outreach program to many of the Company’s largest
shareholders shortly after the third quarter 2014 earnings. Input and
feedback provided by shareholders has been actively incorporated in the
Company’s strategic approach and communication.
X Blue Clay Nominees Not Qualified: After Blue Clay
privately submitted a nominations notice, the Company invited its
nominees to meet with a majority of the members of our Board, including
all of the members of the Board’s Corporate Governance and Nominating
Committee and the Company’s Chief Executive Officer. After carefully
considering the credentials and experience of the Blue Clay nominees,
the Board determined that the Blue Clay nominees did not meet the
Company’s criteria for director nominees and would not be included in
the Company’s slate of nominees at the Annual Meeting.
We urge you to support the Select Comfort directors who have been
instrumental in the development of the Company’s transformational
consumer innovation strategy and who will continue to guide its
successful execution. This is a critical time at Select Comfort. The
Company is poised to deliver continued success, but the election of any
Blue Clay nominees risks the Company’s future by introducing instability
to the Board at a time when the experience of our nominees is essential
to achieving our growth initiatives and long-term value creation.
DO NOT ALLOW BLUE CLAY TO PUT THE VALUE OF YOUR INVESTMENT AT RISK —
REJECT BLUE
CLAY’S NOMINEES
You may receive materials from Blue Clay, which is seeking to elect its
own nominees to the Select Comfort Board. We believe that adding any
of the Blue Clay nominees would be detrimental to the execution of
Select Comfort’s successful strategy.
Blue Clay’s commentary on Select Comfort reveals a lack of understanding
of Select Comfort’s business. If Blue Clay’s nominees are elected, we
would lose significant Board experience and diversity that is highly
relevant to Select Comfort’s growth strategy, including expertise in:
ERP implementation; digital marketing and e-commerce; technology-driven
partnerships; retail, brand and product development; finance;
governance; and executive compensation. Blue Clay’s risky ideas also
ignore the progress already made and the decisive actions successfully
undertaken by your Board.
Your Board fully understands this business and is working hard to ensure
that the Company’s value-creation strategy drives enhanced shareholder
returns. The Board is addressing both the challenges and the
opportunities we face and there is no reason to interrupt the Company’s
progress.
PROTECT YOUR INVESTMENT - VOTE THE WHITE PROXY CARD TODAY
We urge you to protect your investment by voting the enclosed WHITE
proxy card today “FOR” all of Select Comfort’s nominees.
Your vote is extremely important, no matter how many or how few shares
you own. We urge you to vote today by telephone, online or by signing
and dating the enclosed WHITE proxy
card and returning it in the postage-paid envelope provided. Please do
not return or otherwise vote any Blue proxy card sent to you by Blue
Clay.
On behalf of the Board of Directors and management team, we appreciate
the continued support of Select Comfort shareholders as we build value
together.
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Sincerely,
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Jean-Michel Valette
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Shelly Ibach
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Chairman of the Board
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President & Chief Executive Officer
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If you have questions or need assistance in voting your shares,
please call:
Georgeson
480 Washington Boulevard, 26th Floor
Jersey City, NJ 07310
(800) 561-3991 (Toll Free)
e-mail: selectcomfort@georgeson.com
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About Select Comfort Corporation
SLEEP NUMBER, a sleep innovation leader, delivers unparalleled sleep
experiences by offering high-quality, innovative sleep products and
services. The company is the exclusive designer, manufacturer, marketer,
retailer and servicer of a complete line of Sleep Number® beds including
our newest addition, the SleepIQ Kids™ bed. Only the Sleep Number bed
offers SleepIQ® technology – proprietary sensor technology that works
directly with the bed’s DualAir™ system to track and monitor each
individual’s sleep. SleepIQ technology communicates how you slept and
what adjustments you can make to optimize your sleep and improve your
daily life. Sleep Number also offers a full line of exclusive sleep
products including FlexFit™ adjustable bases and Sleep Number® pillows,
sheets and other bedding products. Consumers also benefit from a unique,
value-added retail experience at one of the more than 460 Sleep Number®
stores across the country, online at SleepNumber.com, or via phone at
(800) Sleep Number or (800) 753-3768.
Important Additional Information and Where to Find It
The Company has filed a proxy statement on Schedule 14A and other
relevant documents with the Securities and Exchange Commission (“SEC”)
in connection with the solicitation of proxies for its 2015 Annual
Meeting of Shareholders or any adjournment or postponement thereof (the
“2015 Annual Meeting”) and is mailing, along with this letter, the
definitive proxy statement and a WHITE proxy card to each shareholder of
record entitled to vote at the 2015 Annual Meeting. SHAREHOLDERS ARE
STRONGLY ADVISED TO READ THE COMPANY’S 2015 PROXY STATEMENT (INCLUDING
ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER DOCUMENTS FILED
WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. Shareholders may obtain a free copy of the 2015
proxy statement, any amendments or supplements to the proxy statement
and other documents that the Company files with the SEC from the SEC’s
website at www.sec.gov
or the Company’s website at http://www.sleepnumber.com/investor-relations
as soon as reasonably practicable after such materials are
electronically filed with, or furnished to, the SEC.
Certain Information Regarding Participants in Solicitation
The Company, its directors, its executive officers and its nominees for
election as director may be deemed participants in the solicitation of
proxies from shareholders in connection with the matters to be
considered at the Company’s 2015 Annual Meeting. Information regarding
the persons who may, under the rules of the SEC, be considered
participants in the solicitation of Company shareholders in connection
with the 2015 Annual Meeting, and their direct or indirect interests, by
security holdings or otherwise, which may be different from those of the
Company’s shareholders generally, are set forth in the Company’s
definitive proxy statement for the 2015 Annual Meeting on Schedule 14A
that has been filed with the SEC and the other relevant documents filed
with the SEC.
Forward-looking Statements
Statements used in this news release relating to future plans, events,
financial results, management or performance are forward-looking
statements within the meaning of the Securities Act of 1933 and the
Securities Exchange Act of 1934 and are subject to certain risks and
uncertainties including, among others, such factors as current and
future general and industry economic trends and consumer confidence; the
effectiveness of our marketing messages; the efficiency of our
advertising and promotional efforts; our ability to execute our
company-controlled distribution strategy; our ability to achieve and
maintain acceptable levels of product and service quality, and
acceptable product return and warranty claims rates; our ability to
continue to improve and expand our product line; consumer acceptance of
our products, product quality, innovation and brand image; industry
competition, the emergence of additional competitive products, and the
adequacy of our intellectual property rights to protect our products and
brand from competitive or infringing activities; availability of
attractive and cost-effective consumer credit options; pending and
unforeseen litigation and the potential for adverse publicity associated
with litigation; our “just-in-time” manufacturing processes with minimal
levels of inventory, which may leave us vulnerable to shortages in
supply; our dependence on significant suppliers and our ability to
maintain relationships with key suppliers, including several sole-source
suppliers; the vulnerability of key suppliers to recessionary pressures,
labor negotiations, liquidity concerns or other factors; rising
commodity costs and other inflationary pressures; risks inherent in
global sourcing activities; risks of disruption in the operation of
either of our two primary manufacturing facilities; increasing
government regulations, which have added or will add cost pressures and
process changes to ensure compliance; the adequacy of our management
information systems to meet the evolving needs of our business and to
protect sensitive data from potential cyber threats; the costs,
distractions and potential disruptions to our business related to
upgrading our management information systems; our ability to attract,
retain and motivate qualified management, executive and other key
employees, including qualified retail sales professionals and managers;
and uncertainties arising from global events, such as terrorist attacks
or a pandemic outbreak, or the threat of such events. Additional
information concerning these and other risks and uncertainties is
contained in the company’s filings with the Securities and Exchange
Commission (SEC), including the Annual Report on Form 10-K, and other
periodic reports filed with the SEC. The company has no obligation to
publicly update or revise any of the forward-looking statements in this
news release.
__________________
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1
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Source: May 20, 2014. “Apple and the Other Most Successful Retailers
by Sales Per Square Foot”. Forbes.com
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2
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Direct competitors referenced are Mattress Firm and Tempur-Sealy;
ROIC comparison utilizes publicly available information for
competitors and applies Select Comfort’s previously disclosed ROIC
calculation
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3 |
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Home furnishings companies referenced are Ethan Allen, Havertys,
La-Z-Boy and Pier1; ROIC comparison utilizes publicly available
information for competitors and applies Select Comfort’s previously
disclosed ROIC calculation
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Blue Clay Preliminary Proxy Statement (emphasis added)
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Select Comfort’s 2014 advertising spend of $158.5 million
represented 13.7% of 2014 net sales
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Source: Select Comfort Corporation
Select Comfort Corporation
Investor Contact:
Dave
Schwantes, 763-551-7498
investorrelations@selectcomfort.com
or
Georgeson
Inc.
Steven Pantina, 201-222-4229
Senior Managing Director
spantina@georgeson.com
or
Media
Contact:
Joele Frank, Wilkinson Brimmer Katcher
Tim Lynch
/ Scott Bisang
212-355-4449