CARTHAGE, Mo., Oct. 28, 2019 /PRNewswire/ --
- 3Q sales grew 14%, to $1.24
billion
- 3Q EPS was $.74, an increase of
$.07 vs. 3Q18; 3Q
adjusted1 EPS of $.76, up
$.10 vs 3Q18
- 3Q cash flow from operations was a strong $213 million
- 2019 EPS guidance raised: EPS of $2.40-$2.55;
adjusted EPS of $2.48-$2.63
Diversified manufacturer Leggett & Platt
reported third quarter 2019 sales of $1.24 billion, a 14% increase versus third
quarter last year.
- Acquisitions added 16% to sales growth (primarily ECS)
- Organic sales were down 2%:
-
- Volume down 1% (exited business -4%)
- Absent declines from exited business, volume up 3%
- Raw material-related selling price decreases and negative
currency impact -1%
Third quarter EBIT was $144
million, up $20 million or 16%
from third quarter last year, and adjusted1 EBIT was
$148 million, a $24 million increase.
- EBIT benefited from:
-
- ECS acquisition
- Lower raw material costs
- Improved earnings performance in Furniture Products
- EBIT margin was 11.6% and adjusted1 EBIT margin was
11.9%, up from 11.4% in the third quarter of 2018
Third quarter EPS was $.74. Third quarter adjusted1
EPS was $.76, an increase of
$.10 versus third quarter 2018.
The increase reflects higher EBIT and a lower tax rate
($.03/share) partially offset by
higher interest expense ($.06/share).
Restructuring:
- Third quarter included $4 million
(pretax), or $.02 per share, of
restructuring-related charges
-
- $3 million cash and $1 million non-cash
- Full year restructuring-related charges are expected to be
approximately $14 million
($.08/share)
-
- $7 million cash and $7 million non-cash
CEO Comments
President and CEO Karl G. Glassman commented, "Sales grew 14% in
the third quarter, primarily from the ECS acquisition. Sales
were stronger in Automotive, U.S. Spring, and Work Furniture but
this improvement was more than offset by planned lower volume from
business exited in Fashion Bed and Home Furniture and weak trade
demand in the Industrial Products segment.
"Third quarter adjusted1 EBIT increased a notable
$24 million over third quarter last
year, primarily from the ECS acquisition, lower raw material costs
(including LIFO benefit), and improved earnings performance in
Furniture Products.
"Our Automotive business grew 8% versus third quarter 2018,
exceeding the global market by over 1,000 basis points. This
year we should exceed market growth by 600–700 basis points.
While we remain confident in continued strong performance, ongoing
disruption in the global market makes it difficult to predict our
relative performance with precision. Accordingly, we are
moving away from our specific goal of exceeding market growth by
1,000 basis points, although we expect to significantly outperform
the market over the long term.
"Earlier this month, the U.S. Department of Commerce announced
final dumping duties on mattresses imported from China that range from 57% to 1,732%.
Notably, approximately 90% of Chinese mattresses are now subject to
antidumping duties in excess of 160%. We expect the U.S.
International Trade Commission to make a final determination in
this matter no later than the first week of December. In our
U.S. bedding businesses, we continue to see strong demand.
U.S. Spring sales dollars were up 6%. Finished mattress units were
up 28% in the third quarter, including ECS's year-over-year
growth."
Debt and Cash Flow
- Debt was 3.15x trailing 12-month pro forma adjusted1
EBITDA; we expect to be at our target level of debt to trailing
12-months adjusted EBITDA of approximately 2.5x by the end of
2020
- Operating cash flow was $213
million in the third quarter, an increase of $86 million versus third quarter last year
Dividends
- Leggett & Platt's Board of Directors declared a
$.40 third quarter dividend,
two cents higher than last year's
third quarter
Stock Repurchases
- Repurchased only .2 million shares at an average price of
$40.00; primarily shares surrendered
for employee benefit plans
- Issued .4 million shares through employee benefit plans and
option exercises
- Shares outstanding at the end of the third quarter were 131.6
million
2019 Guidance
- Full year 2019 sales guidance narrowed, and EPS guidance
raised
- Sales are expected to be $4.7-$4.8 billion,
an increase of 10-12% versus 2018
-
- Organic sales are expected to decline -3% to -5%, including -3%
from exited business
- Acquisitions should add 15% to sales
- EPS is expected to be $2.40-$2.55,
including approximately $.08 per
share of restructuring-related costs
- Adjusted EPS is expected to be $2.48-$2.63
- ECS is expected to be neutral to EPS in 2019
- Based on this guidance range, EBIT margin should be 10.7-11.0%;
adjusted EBIT margin should be
11.0-11.3%
- Operating cash flow should exceed $550
million
- Capital expenditures of approximately $160 million, versus prior guidance of
$180 million
- Implied full-year effective tax rate of approximately 22%,
versus prior guidance of 24%
- Prior Guidance:
-
- Sales: $4.7-$4.85 billion
- EPS: $2.30-$2.50; adjusted EPS: $2.40-$2.60
- Implied 4Q Guidance:
-
- Sales are expected to be $1.1-$1.2
billion
- EPS is expected to be $.57-$.72,
including approximately $.02 per
share of restructuring-related costs
- Adjusted EPS is expected to be $.59-$.74
LIFO
- In the third quarter of 2019, lower steel costs resulted in a
LIFO benefit of $7.6 million
(pretax)
- In the third quarter of 2018, increasing steel costs resulted
in LIFO expense of $6.0 million
(pretax)
SEGMENT RESULTS – Third Quarter 2019 (versus 3Q
2018)
Residential Products –
- Total sales grew 41%; acquisitions added 38%
- Organic sales increased 3%
-
- Volume was up 4%, primarily from continued market share and
content gains in U.S. Spring
- Raw material-related price decreases and currency impact
reduced sales 1%
- EBIT increased $10 million, with
earnings from the ECS acquisition (after $12
million of amortization expense) partially offset by
$2 million in restructuring-related
charges and other factors
Industrial Products –
- Total sales decreased 17%, from weak trade demand for steel rod
and wire (-12%) and raw material-related selling price decreases
(-5%)
- EBIT decreased $3 million,
primarily from lower trade steel rod and wire volume and
$1 million in restructuring-related
charges, partially offset by an earnout of $2 million related to a prior-year
divestiture
Furniture Products –
- Total sales were down 8%
- Volume decreased 8%, primarily from our decision to exit
Fashion Bed and planned declines in Home Furniture, partially
offset by growth in Work Furniture and Adjustable Bed
- Raw material-related selling price increases were offset by a
negative currency impact
- EBIT increased $11 million,
primarily from improved pricing and lower fixed costs attributable
to restructuring activity, partially offset by $1 million in restructuring-related charges
Specialized Products –
- Total sales increased 6%
- Volume was up 7%, from growth in Automotive
- Currency impact, net of raw material-related price increases in
Hydraulic Cylinders, decreased sales 1%
- EBIT increased $1 million,
primarily from higher volume in Automotive partially offset by
underperformance at our French Aerospace operation
Slides and Conference Call
A set of slides containing
summary financial information is available from the Investor
Relations section of Leggett's website at www.leggett.com.
Management will host a conference call at 7:30 a.m. Central (8:30 a.m. Eastern) on Tuesday, October 29. The webcast can be accessed
from Leggett's website. The dial-in number is (201) 689-8341; there
is no passcode.
Fourth quarter results will be released after the market closes
on Monday, February 3, with a
conference call the next morning.
FOR MORE INFORMATION: Visit Leggett's website at
www.leggett.com.
COMPANY DESCRIPTION: At Leggett & Platt (NYSE: LEG),
we create innovative products that enhance people's lives,
generate exceptional returns for our shareholders, and
provide sought-after jobs in communities around the world.
L&P is a 136-year-old diversified manufacturer that designs and
produces engineered products found in most homes and automobiles.
The Company is comprised of 15 business units, 22,000
employee-partners, and 145 manufacturing facilities located in 18
countries.
Leggett & Platt is the leading U.S.-based manufacturer of:
a) bedding components; b) automotive seat support and lumbar
systems; c) specialty bedding foams and private-label finished
mattresses; d) components for home furniture and work furniture; e)
flooring underlayment; f) adjustable beds; g) high-carbon drawn
steel wire; and h) bedding industry machinery.
FORWARD-LOOKING STATEMENTS: This press release contains
"forward-looking statements," including, but not limited to, the
2019 total sales, organic sales, annualized sales added by
acquisitions including ECS, EPS, adjusted EPS, EPS impact from ECS,
sales growth, improved EBIT, EBIT margin, adjusted EBIT margin,
cash from operations, decreasing steel costs, LIFO benefit,
restructuring-related costs, the International Trade Commission
final antidumping duty determination; and our ability to deleverage
to a target level ratio of debt to trailing 12-months adjusted
EBITDA of approximately 2.5 by year-end 2020. Such forward-looking
statements are expressly qualified by the cautionary statements
described in this provision and reflect only the beliefs of Leggett
or its management at the time the statement is made. Because all
forward-looking statements deal with the future, they are subject
to risks, uncertainties and developments which might cause actual
events or results to differ materially from those envisioned or
reflected in any forward-looking statement. Moreover, we do not
have, and do not undertake, any duty to update or revise any
forward-looking statement to reflect events or circumstances after
the date on which the statement was made. Some of these risks and
uncertainties include: (i) the Company's and ECS's ability to
achieve their respective operating targets; (ii) inability to
comply with the restrictive covenants in the Company's credit
agreement; (iii) increases or decreases in our capital needs, which
may vary depending on acquisition or divestiture activity, our
working capital needs and capital expenditures; (iv) market
conditions; (v) price and product competition from foreign and
domestic competitors, changes in demand for the Company's products,
cost and availability of raw materials and labor, fuel and energy
costs, our ability to increase the dividend, our ability to
repatriate cash from offshore accounts, net interest expense, tax
rates, increased trade costs, cybersecurity breaches, customer
losses and insolvencies, disruption to our steel rod mill, general
economic conditions, possible goodwill or other asset impairment,
foreign currency fluctuation, the amount of fully diluted shares,
depreciation and amortization, and litigation risks; (vi) changed
restructuring-related costs as more information is obtained; and
(vii) other risk factors in the "Forward-Looking Statements" and
"Risk Factors" sections in Leggett's most recent Form 10-K and
subsequent Form 10-Q reports filed with the SEC.
CONTACT: Investor Relations,
(417) 358-8131 or invest@leggett.com
Susan R. McCoy, Senior Vice
President, Investor Relations
Wendy M. Watson, Director, Investor
Relations
Cassie J. Branscum, Manager,
Investor Relations
1 Please refer to attached tables for Non-GAAP
reconciliations.
LEGGETT &
PLATT
|
RESULTS OF
OPERATIONS
|
|
THIRD
QUARTER
|
|
YEAR TO
DATE
|
(In millions, except
per share data)
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
Net
sales
|
|
$ 1,239.3
|
|
$ 1,091.5
|
|
14%
|
|
$ 3,607.6
|
|
$ 3,222.8
|
|
12%
|
Cost of goods
sold
|
|
963.8
|
|
864.4
|
|
|
|
2,829.4
|
|
2,547.3
|
|
|
Gross
profit
|
|
275.5
|
|
227.1
|
|
21%
|
|
778.2
|
|
675.5
|
|
15%
|
Selling &
administrative expenses
|
|
115.2
|
|
100.7
|
|
14%
|
|
352.1
|
|
313.2
|
|
12%
|
Amortization
|
|
16.3
|
|
5.2
|
|
|
|
47.3
|
|
15.3
|
|
|
Other expense
(income), net
|
|
(0.1)
|
|
(3.2)
|
|
|
|
0.5
|
|
(5.9)
|
|
|
Earnings
before interest and taxes
|
|
144.1
|
|
124.4
|
|
16%
|
|
378.3
|
|
352.9
|
|
7%
|
Net interest
expense
|
|
21.1
|
|
11.1
|
|
|
|
63.0
|
|
36.7
|
|
|
Earnings
before income taxes
|
|
123.0
|
|
113.3
|
|
|
|
315.3
|
|
316.2
|
|
|
Income
taxes
|
|
23.4
|
|
23.3
|
|
|
|
68.3
|
|
63.2
|
|
|
Net
earnings
|
|
99.6
|
|
90.0
|
|
|
|
247.0
|
|
253.0
|
|
|
Less net income from
non-controlling interest
|
|
-
|
|
-
|
|
|
|
-
|
|
(0.1)
|
|
|
Net
earnings attributable to L&P
|
|
$
99.6
|
|
$
90.0
|
|
11%
|
|
$
247.0
|
|
$
252.9
|
|
(2%)
|
Earnings per diluted
share
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
diluted share
|
|
$0.74
|
|
$0.67
|
|
10%
|
|
$1.83
|
|
$1.87
|
|
(2%)
|
Shares
outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock (at end of period)
|
|
131.6
|
|
130.4
|
|
0.9%
|
|
131.6
|
|
130.4
|
|
|
Basic
(average for period)
|
|
134.9
|
|
133.8
|
|
|
|
134.7
|
|
134.4
|
|
|
Diluted
(average for period)
|
|
135.4
|
|
134.7
|
|
0.5%
|
|
135.2
|
|
135.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOW
|
|
THIRD
QUARTER
|
|
YEAR TO
DATE
|
(In
millions)
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
Net
earnings
|
|
$
99.6
|
|
$
90.0
|
|
|
|
$
247.0
|
|
$
253.0
|
|
|
Depreciation and
amortization
|
|
48.4
|
|
33.8
|
|
|
|
144.7
|
|
101.0
|
|
|
Working capital
decrease (increase)
|
|
55.2
|
|
11.9
|
|
|
|
(20.6)
|
|
(121.5)
|
|
|
Impairments
|
|
1.4
|
|
0.1
|
|
|
|
5.7
|
|
0.3
|
|
|
Other operating
activity
|
|
8.3
|
|
(9.3)
|
|
|
|
39.8
|
|
18.3
|
|
|
Net
Cash from Operating Activity
|
|
$
212.9
|
|
$
126.5
|
|
68%
|
|
$
416.6
|
|
$
251.1
|
|
66%
|
Additions to
PP&E
|
|
(32.5)
|
|
(41.4)
|
|
|
|
(103.0)
|
|
(122.6)
|
|
(16%)
|
Purchase of
companies, net of cash
|
|
-
|
|
(17.7)
|
|
|
|
(1,244.3)
|
|
(107.9)
|
|
|
Proceeds from
business and asset sales
|
|
3.3
|
|
1.8
|
|
|
|
5.3
|
|
3.7
|
|
|
Dividends
paid
|
|
(52.6)
|
|
(49.4)
|
|
|
|
(152.0)
|
|
(144.2)
|
|
|
Repurchase of common
stock, net
|
|
(2.1)
|
|
(0.6)
|
|
|
|
(4.4)
|
|
(107.9)
|
|
|
Additions (payments)
to debt, net
|
|
(166.4)
|
|
(90.5)
|
|
|
|
1,074.5
|
|
99.5
|
|
|
Other
|
|
(10.3)
|
|
(11.6)
|
|
|
|
(18.8)
|
|
(34.3)
|
|
|
Increase (Decr.) in Cash & Equiv.
|
|
$
(47.7)
|
|
$
(82.9)
|
|
|
|
$
(26.1)
|
|
$
(162.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
POSITION
|
|
30-Sep
|
|
|
|
|
|
|
(In
millions)
|
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
Cash and
equivalents
|
|
$
242.0
|
|
$
363.5
|
|
|
|
|
|
|
|
|
Receivables
|
|
677.3
|
|
625.5
|
|
|
|
|
|
|
|
|
Inventories
|
|
635.8
|
|
634.0
|
|
|
|
|
|
|
|
|
Other current
assets
|
|
49.5
|
|
44.0
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
1,604.6
|
|
1,667.0
|
|
(4%)
|
|
|
|
|
|
|
Net fixed
assets
|
|
817.3
|
|
723.0
|
|
|
|
|
|
|
|
|
Operating lease
right-of-use assets
|
|
156.0
|
|
—
|
|
|
|
|
|
|
|
|
Goodwill
|
|
1,392.0
|
|
840.3
|
|
|
|
|
|
|
|
|
Intangible assets and
deferred costs
|
|
770.6
|
|
188.4
|
|
|
|
|
|
|
|
|
Other
assets
|
|
117.3
|
|
130.4
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
4,857.8
|
|
$
3,549.1
|
|
37%
|
|
|
|
|
|
|
Trade accounts
payable
|
|
$
467.3
|
|
$
428.7
|
|
|
|
|
|
|
|
|
Current debt
maturities
|
|
51.2
|
|
3.6
|
|
|
|
|
|
|
|
|
Current operating
lease liabilities
|
|
38.0
|
|
—
|
|
|
|
|
|
|
|
|
Other current
liabilities
|
|
364.3
|
|
352.6
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
|
920.8
|
|
784.9
|
|
17%
|
|
|
|
|
|
|
Long-term
debt
|
|
2,197.1
|
|
1,353.2
|
|
62%
|
|
|
|
|
|
|
Operating lease
liabilities
|
|
119.0
|
|
—
|
|
|
|
|
|
|
|
|
Deferred taxes and
other liabilities
|
|
365.3
|
|
245.0
|
|
|
|
|
|
|
|
|
Equity
|
|
1,255.6
|
|
1,166.0
|
|
8%
|
|
|
|
|
|
|
Total
Capitalization
|
|
3,937.0
|
|
2,764.2
|
|
42%
|
|
|
|
|
|
|
TOTAL
LIABILITIES & EQUITY
|
|
$
4,857.8
|
|
$
3,549.1
|
|
37%
|
|
|
|
|
|
|
LEGGETT &
PLATT
|
SEGMENT
RESULTS1
|
|
THIRD
QUARTER
|
|
YEAR TO
DATE
|
(In
millions)
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
Residential
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
631.9
|
|
$
446.5
|
|
41.5%
|
|
$ 1,775.0
|
|
$ 1,283.4
|
|
38.3%
|
Total Sales (External
+ Inter-segment)
|
|
635.6
|
|
449.9
|
|
41.3%
|
|
1,785.1
|
|
1,296.1
|
|
37.7%
|
EBIT
|
|
53.2
|
|
43.0
|
|
24%
|
|
129.5
|
|
118.0
|
|
10%
|
EBIT
Margin
|
|
8.4%
|
|
9.6%
|
|
(120)
bps
|
2
|
7.3%
|
|
9.1%
|
|
(180)
bps
|
Restructuring-related charges
|
|
2.0
|
|
—
|
|
|
|
2.1
|
|
—
|
|
|
ECS
transaction costs
|
|
—
|
|
—
|
|
|
|
0.9
|
|
—
|
|
|
Adjusted
EBIT
|
|
55.2
|
|
43.0
|
|
28%
|
|
132.5
|
|
118.0
|
|
12%
|
Adjusted EBIT
Margin
|
|
8.7%
|
|
9.6%
|
|
(90)
bps
|
|
7.4%
|
|
9.1%
|
|
(170)
bps
|
Depreciation and amortization
|
|
25.9
|
|
11.4
|
|
|
|
75.1
|
|
34.4
|
|
|
Adjusted
EBITDA
|
|
81.1
|
|
54.4
|
|
49%
|
|
207.6
|
|
152.4
|
|
36%
|
Adjusted EBITDA
Margin
|
|
12.8%
|
|
12.1%
|
|
70
bps
|
|
11.6%
|
|
11.8%
|
|
(20)
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industrial
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
68.6
|
|
$
97.4
|
|
(29.6%)
|
|
$
238.1
|
|
$
275.8
|
|
(13.7%)
|
Total Sales (External
+ Inter-segment)
|
|
144.4
|
|
173.4
|
|
(16.7%)
|
|
468.4
|
|
496.3
|
|
(5.6%)
|
EBIT
|
|
22.6
|
|
25.2
|
|
(10%)
|
|
75.9
|
|
47.6
|
|
59%
|
EBIT
Margin
|
|
15.7%
|
|
14.5%
|
|
120
bps
|
|
16.2%
|
|
9.6%
|
|
660
bps
|
Restructuring-related charges
|
|
0.6
|
|
—
|
|
|
|
0.6
|
|
—
|
|
|
Adjusted
EBIT
|
|
23.2
|
|
25.2
|
|
(8%)
|
|
76.5
|
|
47.6
|
|
61%
|
Adjusted EBIT
Margin
|
|
16.1%
|
|
14.5%
|
|
160
bps
|
|
16.3%
|
|
9.6%
|
|
670
bps
|
Depreciation and amortization
|
|
2.8
|
|
2.6
|
|
|
|
8.2
|
|
7.7
|
|
|
Adjusted
EBITDA
|
|
26.0
|
|
27.8
|
|
(6%)
|
|
84.7
|
|
55.3
|
|
53%
|
Adjusted EBITDA
Margin
|
|
18.0%
|
|
16.0%
|
|
200
bps
|
|
18.1%
|
|
11.1%
|
|
700
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Furniture
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
271.6
|
|
$
294.1
|
|
(7.7%)
|
|
$
797.4
|
|
$
866.8
|
|
(8.0%)
|
Total Sales (External
+ Inter-segment)
|
|
273.8
|
|
298.0
|
|
(8.1%)
|
|
804.8
|
|
877.2
|
|
(8.3%)
|
EBIT
|
|
24.6
|
|
14.0
|
|
76%
|
|
51.9
|
|
48.3
|
|
7%
|
EBIT
Margin
|
|
9.0%
|
|
4.7%
|
|
430
bps
|
|
6.4%
|
|
5.5%
|
|
90
bps
|
Restructuring-related charges
|
|
1.2
|
|
—
|
|
|
|
7.4
|
|
—
|
|
|
Adjusted
EBIT
|
|
25.8
|
|
14.0
|
|
84%
|
|
59.3
|
|
48.3
|
|
23%
|
Adjusted EBIT
Margin
|
|
9.4%
|
|
4.7%
|
|
470
bps
|
|
7.4%
|
|
5.5%
|
|
190
bps
|
Depreciation and amortization
|
|
3.8
|
|
4.3
|
|
|
|
11.8
|
|
13.0
|
|
|
Adjusted
EBITDA
|
|
29.6
|
|
18.3
|
|
62%
|
|
71.1
|
|
61.3
|
|
16%
|
Adjusted EBITDA
Margin
|
|
10.8%
|
|
6.1%
|
|
470
bps
|
|
8.8%
|
|
7.0%
|
|
180
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Specialized
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
267.2
|
|
$
253.5
|
|
5.4%
|
|
$
797.1
|
|
$
796.8
|
|
0.0%
|
Total Sales (External
+ Inter-segment)
|
|
268.1
|
|
254.2
|
|
5.5%
|
|
799.6
|
|
798.8
|
|
0.1%
|
EBIT
|
|
44.4
|
|
43.5
|
|
2%
|
|
121.6
|
|
141.5
|
|
(14%)
|
EBIT
Margin
|
|
16.6%
|
|
17.1%
|
|
(50)
bps
|
|
15.2%
|
|
17.7%
|
|
(250)
bps
|
Depreciation and amortization
|
|
10.4
|
|
9.8
|
|
|
|
31.0
|
|
28.7
|
|
|
EBITDA
|
|
54.8
|
|
53.3
|
|
3%
|
|
152.6
|
|
170.2
|
|
(10%)
|
EBITDA
Margin
|
|
20.4%
|
|
21.0%
|
|
(60)
bps
|
|
19.1%
|
|
21.3%
|
|
(220)
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$ 1,239.3
|
|
$ 1,091.5
|
|
13.5%
|
|
$ 3,607.6
|
|
$ 3,222.8
|
|
11.9%
|
EBIT -
segments
|
|
144.8
|
|
125.7
|
|
15%
|
|
378.9
|
|
355.4
|
|
7%
|
Intersegment eliminations and other
|
|
(0.7)
|
|
(1.3)
|
|
|
|
(0.6)
|
|
(2.5)
|
|
|
EBIT
|
|
144.1
|
|
124.4
|
|
16%
|
|
378.3
|
|
352.9
|
|
7%
|
EBIT
Margin
|
|
11.6%
|
|
11.4%
|
|
20
bps
|
|
10.5%
|
|
11.0%
|
|
(50)
bps
|
Restructuring-related charges 3
|
|
3.8
|
|
—
|
|
|
|
10.1
|
|
—
|
|
|
ECS
transaction costs 3
|
|
—
|
|
—
|
|
|
|
0.9
|
|
—
|
|
|
Adjusted EBIT
3
|
|
147.9
|
|
124.4
|
|
19%
|
|
389.3
|
|
352.9
|
|
10%
|
Adjusted EBIT
Margin
|
|
11.9%
|
|
11.4%
|
|
50
bps
|
|
10.8%
|
|
11.0%
|
|
(20)
bps
|
Depreciation and amortization - segments
|
|
42.9
|
|
28.1
|
|
|
|
126.1
|
|
83.8
|
|
|
Depreciation and amortization - unallocated 4
|
|
5.5
|
|
5.7
|
|
|
|
18.6
|
|
17.2
|
|
|
Adjusted EBITDA
3
|
|
196.3
|
|
158.2
|
|
24%
|
|
534.0
|
|
453.9
|
|
18%
|
Adjusted EBITDA
Margin
|
|
15.8%
|
|
14.5%
|
|
130
bps
|
|
14.8%
|
|
14.1%
|
|
70
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LAST SIX
QUARTERS
|
|
2018
|
|
2019
|
Selected
Figures
|
|
2Q
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
Net Sales ($
million)
|
|
1,102
|
|
1,092
|
|
1,047
|
|
1,155
|
|
1,213
|
|
1,239
|
Sales Growth (vs.
prior year)
|
|
11%
|
|
8%
|
|
6%
|
|
12%
|
|
10%
|
|
14%
|
Volume Growth (same
locations vs. prior year)
|
|
6%
|
|
3%
|
|
—%
|
|
(3%)
|
|
(6%)
|
|
(1%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
3($ million)
|
|
121
|
|
124
|
|
120
|
|
105
|
|
136
|
|
148
|
Cash from Operations
($ million)
|
|
81
|
|
127
|
|
189
|
|
31
|
|
172
|
|
213
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(trailing twelve months) 3($ million)
|
|
589
|
|
598
|
|
609
|
|
620
|
|
651
|
|
689
|
(Long-term debt +
current maturities) / Adj. EBITDA 3,5
|
|
2.5
|
|
2.3
|
|
1.9
|
|
4.0
|
|
3.7
|
|
3.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Sales (vs.
prior year)
|
|
2Q
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
Residential
Products
|
|
7%
|
|
3%
|
|
5%
|
|
3%
|
|
(1%)
|
|
3%
|
Industrial
Products
|
|
23%
|
|
28%
|
|
22%
|
|
10%
|
|
(9%)
|
|
(17%)
|
Furniture
Products
|
|
9%
|
|
4%
|
|
(1%)
|
|
(5%)
|
|
(11%)
|
|
(8%)
|
Specialized
Products
|
|
11%
|
|
3%
|
|
—%
|
|
(5%)
|
|
(3%)
|
|
6%
|
Overall
|
|
10%
|
|
6%
|
|
3%
|
|
(1%)
|
|
(6%)
|
|
(2%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1Segment
margins calculated on Total Sales. Overall company
margin calculated on External Sales.
|
|
2bps =
basis points; a unit of measure equal to 1/100thof
1%.
|
3Refer to
next page for non-GAAP reconciliations.
|
4Consists
primarily of depreciation of non-operating assets and amortization
of debt issuance costs.
|
5EBITDA
based on trailing twelve months.
|
LEGGETT &
PLATT
|
RECONCILIATION OF
REPORTED (GAAP) TO ADJUSTED (Non-GAAP) FINANCIAL MEASURES
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018
|
|
2019
|
Non-GAAP
adjustments 6
|
|
2Q
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
Restructuring-related
charges
|
|
-
|
|
-
|
|
16.3
|
|
6.3
|
|
-
|
|
3.8
|
Note
impairment
|
|
-
|
|
-
|
|
15.9
|
|
-
|
|
-
|
|
-
|
ECS transaction
costs
|
|
-
|
|
-
|
|
6.9
|
|
0.9
|
|
-
|
|
-
|
Non-GAAP
adjustments (pretax) 7
|
|
-
|
|
-
|
|
39.1
|
|
7.2
|
|
-
|
|
3.8
|
Income tax
impact
|
|
-
|
|
-
|
|
(7.5)
|
|
(1.8)
|
|
-
|
|
(0.4)
|
Tax Cuts and Jobs Act
impact
|
|
-
|
|
(1.8)
|
|
-
|
|
-
|
|
-
|
|
-
|
Non-GAAP
adjustments (after tax)
|
|
-
|
|
(1.8)
|
|
31.6
|
|
5.4
|
|
-
|
|
3.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares
outstanding
|
|
135.0
|
|
134.7
|
|
134.7
|
|
135.0
|
|
135.2
|
|
135.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS impact of
non-GAAP adjustments
|
|
-
|
|
(0.01)
|
|
0.23
|
|
0.04
|
|
-
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018
|
|
2019
|
Adjusted EBIT,
EBITDA, Margin, and EPS 6
|
|
2Q
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
Net
sales
|
|
1,102
|
|
1,092
|
|
1,047
|
|
1,155
|
|
1,213
|
|
1,239
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (earnings before
interest and taxes)
|
|
121.1
|
|
124.4
|
|
84.0
|
|
98.2
|
|
136.0
|
|
144.1
|
Non-GAAP adjustments
(pretax and excluding interest) 8
|
|
-
|
|
-
|
|
36.0
|
|
7.2
|
|
-
|
|
3.8
|
Adjusted EBIT ($
millions)
|
|
121.1
|
|
124.4
|
|
120.0
|
|
105.4
|
|
136.0
|
|
147.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
margin
|
|
11.0%
|
|
11.4%
|
|
8.0%
|
|
8.5%
|
|
11.2%
|
|
11.6%
|
Adjusted EBIT
margin
|
|
11.0%
|
|
11.4%
|
|
11.5%
|
|
9.1%
|
|
11.2%
|
|
11.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
|
|
121.1
|
|
124.4
|
|
84.0
|
|
98.2
|
|
136.0
|
|
144.1
|
Depreciation and
Amortization
|
|
33.8
|
|
33.8
|
|
35.1
|
|
46.3
|
|
50.0
|
|
48.4
|
EBITDA
|
|
154.9
|
|
158.2
|
|
119.1
|
|
144.5
|
|
186.0
|
|
192.5
|
Non-GAAP adjustments
(pretax and excluding interest) 8
|
|
-
|
|
-
|
|
36.0
|
|
7.2
|
|
-
|
|
3.8
|
Adjusted EBITDA ($
millions)
|
|
154.9
|
|
158.2
|
|
155.1
|
|
151.7
|
|
186.0
|
|
196.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
margin
|
|
14.1%
|
|
14.5%
|
|
11.4%
|
|
12.5%
|
|
15.3%
|
|
15.5%
|
Adjusted EBITDA
margin
|
|
14.1%
|
|
14.5%
|
|
14.8%
|
|
13.1%
|
|
15.3%
|
|
15.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
EPS
|
|
0.63
|
|
0.67
|
|
0.39
|
|
0.45
|
|
0.64
|
|
0.74
|
EPS impact of
non-GAAP adjustments
|
|
-
|
|
(0.01)
|
|
0.23
|
|
0.04
|
|
-
|
|
0.02
|
Adjusted EPS
($)
|
|
0.63
|
|
0.66
|
|
0.62
|
|
0.49
|
|
0.64
|
|
0.76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018
|
|
2019
|
Total Debt to
Adjusted EBITDA 9
|
|
2Q
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
Total Debt
|
|
1,452
|
|
1,357
|
|
1,169
|
|
2,461
|
|
2,415
|
|
2,248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA,
trailing 12 months
|
|
589
|
|
598
|
|
609
|
|
620
|
|
651
|
|
689
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Debt /
Leggett Reported 12-month Adjusted EBITDA
|
|
2.5
|
|
2.3
|
|
1.9
|
|
4.0
|
|
3.7
|
|
3.3
|
Total Debt /
Leggett and ECS 12-month Pro Forma Adjusted EBITDA
10
|
|
|
|
|
|
|
|
3.56
|
|
3.45
|
|
3.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6Management and investors use these
measures as supplemental information to assess operational
performance.
|
7The
non-GAAP adjustments affected various line items on the income
statement. Details by quarter: 4Q 2018: $4.4 million COGS,
$19.6 million SG&A, $11.9 million other expense, $3.2 million
interest expense. 1Q 2019: $2.4 million COGS, $0.9 million
SG&A, $3.9 million other expense. 3Q 2019: ($0.9) million
COGS, $4.7 million other expense.
|
84Q 2018
excludes $3.2 million of financing-related charges recognized in
interest expense.
|
9Management and investors use this ratio
as supplemental information to assess ability to pay off
debt. These ratios are calculated differently than the
Company's credit facility covenant ratio.
|
10The
Leggett and ECS pro forma adjusted EBITDA for the 12 months ended
March 31, June 30, and September 30, 2019 is presented in the
table below. Because the increase in total debt from December
31, 2018 to September 30, 2019 was directly attributable to the ECS
acquisition, we believe it is more meaningful to investors to
include ECS's pre-acquisition adjusted EBITDA for the trailing 12
months ended March 31, June 30, and September 30, 2019 in the total
debt / 12-month adjusted EBITDA calculation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ECS
pre-acquisition adjusted EBITDA from:
|
|
|
|
|
|
|
|
4/1/18 –
1/16/19
|
|
7/1/18 –
1/16/19
|
|
10/1/18 –
1/16/19
|
Net
earnings
|
|
|
|
|
|
|
|
12
|
|
6
|
|
-
|
Interest
expense
|
|
|
|
|
|
|
|
33
|
|
22
|
|
12
|
Taxes
|
|
|
|
|
|
|
|
6
|
|
4
|
|
1
|
EBIT
|
|
|
|
|
|
|
|
51
|
|
32
|
|
13
|
Depreciation and
Amortization
|
|
|
|
|
|
|
|
14
|
|
10
|
|
5
|
Change in control
bonus
|
|
|
|
|
|
|
|
7
|
|
7
|
|
7
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
72
|
|
49
|
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leggett
Adjusted EBITDA, trailing 12 months (including ECS from January 16,
2019)
|
|
|
|
|
|
|
|
620
|
|
651
|
|
689
|
ECS
pre-acquisition adjusted EBITDA
|
|
|
|
|
|
|
|
72
|
|
49
|
|
25
|
Leggett
and ECS Pro Forma Adjusted EBITDA, trailing 12 months
|
|
|
|
|
|
|
|
692
|
|
700
|
|
714
|
Total Debt
/ Leggett and ECS 12-month Pro Forma Adjusted EBITDA
|
|
|
|
|
|
|
|
3.56
|
|
3.45
|
|
3.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11Calculations impacted by
rounding.
|
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