Sealy Reports Double Digit Sales Gain

Sealy Reports Double Digit Sales Gain and a 94% Increase in Net Income
Thursday, April 14, 2005

Sealy Reports Double Digit Sales Gain and a 94% Increase in Net Income: "Sealy Mattress Corporation, the world's largest manufacturer of bedding products, today announced results for the fiscal first quarter ending February 27, 2005.

For the quarter, Sealy reported sales of $359.0 million, an increase of 12.8% from $318.2 million for the same period a year ago. Net income was $21.9 million, an increase of 94.1% from $11.3 million a year earlier. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter was $58.8 million, compared with $42.6 million a year earlier, an increase of 38%. For the quarter, Adjusted EBITDA, as defined in the credit agreement governing our senior secured credit facilities, was $59.6 million. Please see the attached tables below for a reconciliation of EBITDA and Adjusted EBITDA to net income and cash flow from operations.

'We are extremely pleased with our start in 2005,' said David J. McIlquham, Sealy's Chairman and Chief Executive Officer. 'We continue to achieve strong sales increases and mix improvements from our new products as well as improved manufacturing efficiencies. Our ongoing effort on delivering sales, margin and EBITDA growth along with net debt reduction was recognized by Moody's in an upgrade of our senior subordinated debt rating from a Caa1 to a B3,' said McIlquham.

'Additionally, in the first quarter, we began the introduction of our new TrueForm(TM) visco-elastic mattress to go after the rapidly growing specialty bedding market,' said McIlquham.

Subsequent to the end of the first quarter Sealy announced its intention to amend its senior secured credit facility in April of 2005. The final terms and timing of the refinancing, if it occurs, will depend on market conditions and other factors. In connection with the amendment."