CARTHAGE, Mo., Feb. 3, 2020 /PRNewswire/ --
- 4Q sales grew 9%, to $1.14
billion
- 4Q EPS was $.64 and 4Q
adjusted1 EPS was $.68,
increases vs 4Q18
- 2019 sales increased 11%, to $4.75
billion
- 2019 EPS was $2.47 and 2019
adjusted1 EPS was $2.57,
increases vs 2018
- 2019 cash flow from operations was a record $668 million
- 2020 guidance: EPS of $2.40–$2.60 on sales of $4.7–$4.9 billion
Diversified manufacturer Leggett & Platt
reported fourth quarter 2019 sales of $1.14 billion, a 9% increase versus fourth
quarter last year.
- Acquisitions added 13% to sales growth (primarily ECS)
- Organic sales were down 4%:
-
- Volume up 2% absent declines from exited business (which
reduced sales 3%)
- Raw material-related selling price decreases and negative
currency impact -3%
Fourth quarter EBIT was $135
million, up $51 million or 61%
from fourth quarter last year, and adjusted1 EBIT
was $140 million, a $20 million or 17% increase.
- EBIT and adjusted1 EBIT benefited from:
-
- ECS acquisition
- Lower raw material costs (including LIFO benefit)
- Improved earnings performance in Furniture Products
- EBIT margin was 11.8%, up from 8.0% in the fourth quarter of
2018, and adjusted1 EBIT margin was 12.2%, up from
11.5%
Fourth quarter EPS was $.64, an increase of $.25 versus fourth quarter 2018.
Adjusted1 EPS was $.68, an increase of $.06, and reflects higher adjusted1
EBIT partially offset by higher interest expense ($.04/share) and a higher tax rate ($.02/share).
Full-Year Results:
2019 sales of $4.75
billion, an 11% increase versus last year
- Acquisitions added 14% to sales growth (ECS and other smaller
acquisitions)
- Organic sales were down 3%:
-
- Volume down 3% due to exited business
- Raw material-related selling price increases 1%
- Currency impact -1%
2019 EBIT was $513
million, up $76 million or 18%
from 2018, and adjusted1 EBIT was $529 million, a $56
million or 12% increase.
- EBIT and adjusted1 EBIT benefited from:
-
- ECS acquisition
- Lower raw material costs (including LIFO benefit)
- Improved earnings performance in Furniture Products
- EBIT margin was 10.8%, up from 10.2% in 2018, and
adjusted1 EBIT margin was 11.1%, flat with 2018
2019 EPS was $2.47, an
increase of $.21 versus 2018.
Full-year adjusted1 EPS was $2.57, an increase of $.09, and reflects higher adjusted1
EBIT partially offset by higher interest expense largely due to the
ECS acquisition ($.20/share) and a
higher tax rate ($.04/share).
Adjustments to Earnings:
- Fourth quarter included $5
million (pretax), or $.04 per
share, of restructuring-related charges
-
- $3 million cash and $2 million non-cash
- Full-year adjustments included restructuring-related
charges of $15 million (pretax) and
ECS transaction costs of $1 million
(pretax), or $.10 per share
-
- $9 million cash and $7 million non-cash
CEO Comments
Chairman and CEO Karl G. Glassman
commented, "In 2019, our employees achieved several milestones
including the acquisition of ECS, the largest acquisition in
Company history, record cash flow from operations, and our
48th consecutive annual dividend increase. We also
announced organizational changes, including segment realignment,
effective January 1, 2020, and key
executive and board appointments.
"Portfolio management remains a strategic priority. Over
the past several years we have enhanced our business portfolio and
improved margins by growing our stronger businesses and exiting or
restructuring businesses that consistently struggled to deliver
acceptable margins and returns. During 2019 we acquired two
businesses: ECS, which contributed meaningfully to EBIT and
operating cash flow, and a small Geo Components operation. We
also completed the restructuring of Home Furniture and the exit of
Fashion Bed.
"During 2019, sales grew 11% primarily from the ECS acquisition.
Sales were stronger in U.S. Spring, Automotive, Work
Furniture and Aerospace but these improvements were 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. Full year adjusted1 EBIT increased
$56 million over 2018, primarily from
the ECS acquisition, lower raw material costs including LIFO
benefit, and improved earnings performance in Furniture
Products.
"In 2020, we expect mid-single-digit volume growth from
Automotive, U.S. Spring, ECS, Aerospace, Geo Components and Work
Furniture, to be offset by further year-over-year sales declines
from exited business in Fashion Bed and Home Furniture, continued
weak trade demand for steel rod and wire and raw material-related
selling price decreases which began in the second half of
2019. Prior year acquisitions should add 1% to sales
growth. Earnings growth in Automotive, U.S Spring, ECS and
several of our businesses is expected to be more than offset by
increasing steel costs, including the non-recurrence of 2019's LIFO
benefit, and investments to support future growth."
Debt and Cash Flow
- Debt was 2.9x trailing 12-months pro forma adjusted1
EBITDA; we expect to be at debt to trailing 12-months adjusted
EBITDA of approximately 2.5x by the end of 2020
- Operating cash flow was a record $668
million during 2019, an increase of $228 million versus last year
2020 Guidance
- Sales are expected to be $4.7–$4.9 billion, -1% to +3% versus 2019
-
- Organic sales are expected to be -2% to +2%
-
- Volume expected to be -1% to +3%, including -1% from exited
business
- Raw material-related selling price decreases should reduce
sales by 1%
- Prior year acquisitions should add 1% to sales growth
- EPS is expected to be $2.40–$2.60
- Based on this guidance range, EBIT margin should be
10.7%–11.0%
- Additional guidance expectations:
-
- Depreciation and amortization $200
million
- Net interest expense $80
million
- Effective tax rate 23%
- Fully diluted shares of 136 million
- Operating cash flow $550
million
- Capital expenditures $160
million
LIFO
- In 2019, lower steel costs resulted in a LIFO benefit of
$32 million (pretax)
- In 2018, increasing steel costs resulted in LIFO expense of
$31 million (pretax)
SEGMENT RESULTS – Fourth Quarter 2019 (versus 4Q
2018)
Residential Products –
- Total sales grew 32%; acquisitions added 33%
- Organic sales decreased 1%
-
- Volume was up 2%, primarily from continued market share and
content gains in U.S. Spring
- Raw material-related price decreases reduced sales 3%
- EBIT increased $26 million,
primarily from the non-recurrence of a $16
million non-cash impairment charge related to a note
receivable and $4 million in costs
incurred with the ECS acquisition in the fourth quarter of 2018.
EBIT also benefited from ECS acquisition earnings (after
$12 million of amortization
expense).
Industrial Products –
- Total sales decreased 24%
-
- Volume was down 14% from weak trade demand for steel rod and
wire
- Raw material-related selling price decreases reduced sales
10%
- EBIT increased $1 million,
primarily from lower raw material costs (including LIFO benefit)
largely offset by lower metal margin and lower trade steel rod and
wire volume
Furniture Products –
- Total sales were down 5%
- Volume decreased 4%, primarily from our decision to exit
Fashion Bed and planned declines in Home Furniture, partially
offset by growth in Adjustable Bed
- Currency impact and raw material-related selling price
decreases reduced sales 1%
- EBIT increased $20 million,
primarily from lower restructuring-related charges ($3 million in 4Q 2019 versus $15 million in 4Q 2018) as well as lower raw
material costs (including LIFO benefit) and lower fixed costs
attributable to restructuring activity
Specialized Products –
- Total sales increased 4%
- Volume was up 5%, primarily from growth in Automotive and
Aerospace
- Currency impact decreased sales 1%
- EBIT increased $1 million,
primarily from higher volume in Automotive and Aerospace partially
offset by lower volume in Hydraulic Cylinders
SEGMENT RESULTS – Full Year 2019 (versus
2018)
Residential Products –
- Total sales grew 36%; acquisitions added 35%
- Organic sales increased 1%
-
- Volume was up 1%, with growth in U.S. Spring, European Spring
and Geo Components offset by lower sales in other businesses,
primarily Flooring Products and Machinery
- Raw material-related price increases were offset by a negative
currency impact
- EBIT increased $38 million,
primarily from earnings from the ECS acquisition (after
$45 million of amortization expense
and a $5 million non-recurring charge
related to acquired inventories) and the non-recurrence of a
$16 million non-cash impairment
charge related to a note receivable in the fourth quarter of
2018
Industrial Products –
- Total sales decreased 10%
-
- Volume was down 13% from weak trade demand for steel rod and
wire
- Raw material-related selling price increases added 3% to
sales
- EBIT increased $29 million,
primarily from lower raw material costs (including LIFO benefit)
partially offset by lower trade steel rod and wire volume
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
- Raw material-related selling price increases were offset by a
negative currency impact
- EBIT increased $24 million,
primarily from improved pricing and lower fixed costs attributable
to restructuring activity and lower restructuring-related charges
($10 million in 2019 versus
$15 million in 2018)
Specialized Products –
- Total sales were up 1% from the PHC acquisition in early 2018;
organic sales were flat
- Volume was up 2%, from growth in Automotive and Aerospace
- Currency impact, net of raw material-related price increases in
Hydraulic Cylinders, decreased sales 2%
- EBIT decreased $18 million, with
earnings from higher volume offset by higher operating costs in
Aerospace and Hydraulic Cylinders, negative currency impact, and
investments to support future growth in Automotive
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, February 4. The webcast can be accessed
from Leggett's website. The dial-in number is (201) 689-8341; there
is no passcode.
First quarter results will be released after the market closes
on Monday, May 4, 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 137-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 140 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; and g) bedding industry
machinery.
FORWARD-LOOKING STATEMENTS: This press release contains
"forward-looking statements," including, but not limited to, the
2020 total sales, organic sales, volume growth from Automotive,
U.S. Spring, ECS, Aerospace, Geo Components and Work Furniture,
volume, annualized sales added by acquisitions, EPS, sales growth,
improved EBIT, EBIT margin, cash from operations, decreasing steel
costs, depreciation and amortization, net interest, effective tax
rate, fully diluted shares, capital expenditures; and our ability
to deleverage to a 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 ability to achieve its
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, climate change regulations,
environmental, social and governance risks, general economic
conditions, possible goodwill or other asset impairment, foreign
currency fluctuation, the amount of fully diluted shares,
depreciation and amortization, and litigation risks; and (vi) 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, Vice President,
Investor Relations
Cassie J. Branscum, Manager,
Investor Relations
1 Please refer to attached tables for Non-GAAP
reconciliations.
LEGGETT &
PLATT
|
|
|
|
|
|
|
|
|
|
|
RESULTS OF
OPERATIONS
|
|
FOURTH
QUARTER
|
|
YEAR TO
DATE
|
(In millions, except
per share data)
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
Net
sales
|
|
$1,144.9
|
|
$1,046.7
|
|
9%
|
|
$4,752.5
|
|
$4,269.5
|
|
11%
|
Cost of goods
sold
|
|
872.5
|
|
833.5
|
|
|
|
3,701.9
|
|
3,380.8
|
|
|
Gross
profit
|
|
272.4
|
|
213.2
|
|
28%
|
|
1,050.6
|
|
888.7
|
|
18%
|
Selling &
administrative expenses
|
|
117.6
|
|
111.9
|
|
5%
|
|
469.7
|
|
425.1
|
|
10%
|
Amortization
|
|
16.0
|
|
5.2
|
|
|
|
63.3
|
|
20.5
|
|
|
Other expense
(income), net
|
|
3.7
|
|
12.1
|
|
|
|
4.2
|
|
6.2
|
|
|
Earnings
before interest and taxes
|
|
135.1
|
|
84.0
|
|
61%
|
|
513.4
|
|
436.9
|
|
18%
|
Net interest
expense
|
|
20.3
|
|
15.8
|
|
|
|
83.3
|
|
52.5
|
|
|
Earnings
before income taxes
|
|
114.8
|
|
68.2
|
|
|
|
430.1
|
|
384.4
|
|
|
Income
taxes
|
|
27.9
|
|
15.1
|
|
|
|
96.2
|
|
78.3
|
|
|
Net
earnings
|
|
86.9
|
|
53.1
|
|
|
|
333.9
|
|
306.1
|
|
|
Less net income from
non-controlling interest
|
|
(0.1)
|
|
(0.1)
|
|
|
|
(0.1)
|
|
(0.2)
|
|
|
Net
earnings attributable to L&P
|
|
$
86.8
|
|
$
53.0
|
|
64%
|
|
$
333.8
|
|
$
305.9
|
|
9%
|
Earnings per diluted
share
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
per diluted share
|
|
$0.64
|
|
$0.39
|
|
64%
|
|
$2.47
|
|
$2.26
|
|
9%
|
Shares
outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock (at end of period)
|
|
131.8
|
|
130.5
|
|
1.0%
|
|
131.8
|
|
130.5
|
|
|
Basic
(average for period)
|
|
135.2
|
|
134.0
|
|
|
|
134.8
|
|
134.3
|
|
|
Diluted
(average for period)
|
|
135.8
|
|
134.7
|
|
0.8%
|
|
135.4
|
|
135.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOW
|
|
FOURTH
QUARTER
|
|
YEAR TO
DATE
|
(In
millions)
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
Net
earnings
|
|
$
86.9
|
|
$
53.1
|
|
|
|
$
333.9
|
|
$
306.1
|
|
|
Depreciation and
amortization
|
|
47.2
|
|
35.1
|
|
|
|
191.9
|
|
136.1
|
|
|
Working capital
decrease (increase)
|
|
101.1
|
|
75.5
|
|
|
|
80.5
|
|
(46.0)
|
|
|
Impairments
|
|
2.1
|
|
5.1
|
|
|
|
7.8
|
|
5.4
|
|
|
Other operating
activity
|
|
14.1
|
|
20.4
|
|
|
|
53.9
|
|
38.7
|
|
|
Net
Cash from Operating Activity
|
|
$
251.4
|
|
$
189.2
|
|
33%
|
|
$
668.0
|
|
$
440.3
|
|
52%
|
Additions to
PP&E
|
|
(40.1)
|
|
(37.0)
|
|
|
|
(143.1)
|
|
(159.6)
|
|
(10%)
|
Purchase of
companies, net of cash
|
|
(20.8)
|
|
(1.3)
|
|
|
|
(1,265.1)
|
|
(109.2)
|
|
|
Proceeds from
business and asset sales
|
|
0.2
|
|
1.2
|
|
|
|
5.5
|
|
4.9
|
|
|
Dividends
paid
|
|
(52.6)
|
|
(49.5)
|
|
|
|
(204.6)
|
|
(193.7)
|
|
|
Repurchase of common
stock, net
|
|
(2.7)
|
|
0.3
|
|
|
|
(7.1)
|
|
(107.6)
|
|
|
Additions (payments)
to debt, net
|
|
(127.5)
|
|
(185.3)
|
|
|
|
947.0
|
|
(85.8)
|
|
|
Other
|
|
(2.3)
|
|
(13.0)
|
|
|
|
(21.1)
|
|
(47.3)
|
|
|
Increase (Decr.) in Cash & Equiv.
|
|
$
5.6
|
|
$
(95.4)
|
|
|
|
$
(20.5)
|
|
$
(258.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
POSITION
|
|
31-Dec
|
|
|
|
|
|
|
(In
millions)
|
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
Cash and
equivalents
|
|
$
247.6
|
|
$
268.1
|
|
|
|
|
|
|
|
|
Receivables
|
|
591.9
|
|
571.6
|
|
|
|
|
|
|
|
|
Inventories
|
|
636.7
|
|
633.9
|
|
|
|
|
|
|
|
|
Other current
assets
|
|
61.9
|
|
51.0
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
1,538.1
|
|
1,524.6
|
|
1%
|
|
|
|
|
|
|
Net fixed
assets
|
|
830.8
|
|
728.5
|
|
|
|
|
|
|
|
|
Operating lease
right-of-use assets
|
|
158.8
|
|
—
|
|
|
|
|
|
|
|
|
Goodwill
|
|
1,406.3
|
|
833.8
|
|
|
|
|
|
|
|
|
Intangible assets and
deferred costs
|
|
764.0
|
|
178.7
|
|
|
|
|
|
|
|
|
Other
assets
|
|
118.4
|
|
116.4
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$4,816.4
|
|
$3,382.0
|
|
42%
|
|
|
|
|
|
|
Trade accounts
payable
|
|
$
463.4
|
|
$
465.4
|
|
|
|
|
|
|
|
|
Current debt
maturities
|
|
51.1
|
|
1.2
|
|
|
|
|
|
|
|
|
Current operating
lease liabilities
|
|
39.3
|
|
—
|
|
|
|
|
|
|
|
|
Other current
liabilities
|
|
374.3
|
|
349.1
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
|
928.1
|
|
815.7
|
|
14%
|
|
|
|
|
|
|
Long-term
debt
|
|
2,066.5
|
|
1,167.8
|
|
77%
|
|
|
|
|
|
|
Operating lease
liabilities
|
|
121.6
|
|
—
|
|
|
|
|
|
|
|
|
Deferred taxes and
other liabilities
|
|
387.7
|
|
240.9
|
|
|
|
|
|
|
|
|
Equity
|
|
1,312.5
|
|
1,157.6
|
|
13%
|
|
|
|
|
|
|
Total
Capitalization
|
|
3,888.3
|
|
2,566.3
|
|
52%
|
|
|
|
|
|
|
TOTAL
LIABILITIES & EQUITY
|
|
$4,816.4
|
|
$3,382.0
|
|
42%
|
|
|
|
|
|
|
LEGGETT &
PLATT
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT
RESULTS1
|
|
FOURTH
QUARTER
|
|
YEAR TO
DATE
|
|
(In
millions)
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
|
Residential
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
556.0
|
|
$
420.3
|
|
32.3%
|
|
$2,331.0
|
|
$1,703.7
|
|
36.8%
|
|
Total Sales (External
+ Inter-segment)
|
|
559.1
|
|
424.7
|
|
31.6%
|
|
2,344.2
|
|
1,720.8
|
|
36.2%
|
|
EBIT
|
|
41.1
|
|
14.8
|
|
178%
|
|
170.6
|
|
132.8
|
|
28%
|
|
EBIT
Margin
|
|
7.4%
|
|
3.5%
|
|
390
bps
|
2
|
7.3%
|
|
7.7%
|
|
(40)
bps
|
2
|
Restructuring-related charges
|
|
2.0
|
|
0.8
|
|
|
|
4.1
|
|
0.8
|
|
|
|
ECS
transaction costs
|
|
—
|
|
3.7
|
|
|
|
0.9
|
|
3.7
|
|
|
|
Note
impairment
|
|
—
|
|
15.9
|
|
|
|
—
|
|
15.9
|
|
|
|
Adjusted
EBIT
|
|
43.1
|
|
35.2
|
|
22%
|
|
175.6
|
|
153.2
|
|
15%
|
|
Adjusted EBIT
Margin
|
|
7.7%
|
|
8.3%
|
|
(60)
bps
|
|
7.5%
|
|
8.9%
|
|
(140)
bps
|
|
Depreciation and amortization
|
|
26.6
|
|
12.2
|
|
|
|
104.2
|
|
46.6
|
|
|
|
Adjusted
EBITDA
|
|
69.7
|
|
47.4
|
|
47%
|
|
279.8
|
|
199.8
|
|
40%
|
|
Adjusted EBITDA
Margin
|
|
12.5%
|
|
11.2%
|
|
130
bps
|
|
11.9%
|
|
11.6%
|
|
30
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industrial
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
57.5
|
|
$
91.6
|
|
(37.2%)
|
|
$
295.6
|
|
$
367.4
|
|
(19.5%)
|
|
Total Sales (External
+ Inter-segment)
|
|
126.8
|
|
166.1
|
|
(23.7%)
|
|
595.2
|
|
662.4
|
|
(10.1%)
|
|
EBIT
|
|
21.6
|
|
20.8
|
|
4%
|
|
97.5
|
|
68.4
|
|
43%
|
|
EBIT
Margin
|
|
17.0%
|
|
12.5%
|
|
450
bps
|
|
16.4%
|
|
10.3%
|
|
610
bps
|
|
Restructuring-related charges
|
|
0.4
|
|
—
|
|
|
|
1.0
|
|
—
|
|
|
|
Adjusted
EBIT
|
|
22.0
|
|
20.8
|
|
6%
|
|
98.5
|
|
68.4
|
|
44%
|
|
Adjusted EBIT
Margin
|
|
17.4%
|
|
12.5%
|
|
490
bps
|
|
16.5%
|
|
10.3%
|
|
620
bps
|
|
Depreciation and amortization
|
|
2.8
|
|
2.6
|
|
|
|
11.0
|
|
10.3
|
|
|
|
Adjusted
EBITDA
|
|
24.8
|
|
23.4
|
|
6%
|
|
109.5
|
|
78.7
|
|
39%
|
|
Adjusted EBITDA
Margin
|
|
19.6%
|
|
14.1%
|
|
550
bps
|
|
18.4%
|
|
11.9%
|
|
650
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Furniture
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
261.7
|
|
$
275.3
|
|
(4.9%)
|
|
$1,059.1
|
|
$1,142.1
|
|
(7.3%)
|
|
Total Sales (External
+ Inter-segment)
|
|
263.8
|
|
278.7
|
|
(5.3%)
|
|
1,068.6
|
|
1,155.9
|
|
(7.6%)
|
|
EBIT
|
|
21.5
|
|
1.3
|
|
1554%
|
|
73.4
|
|
49.6
|
|
48%
|
|
EBIT
Margin
|
|
8.2%
|
|
0.5%
|
|
770
bps
|
|
6.9%
|
|
4.3%
|
|
260
bps
|
|
Restructuring-related charges
|
|
2.6
|
|
15.5
|
|
|
|
10.0
|
|
15.5
|
|
|
|
Adjusted
EBIT
|
|
24.1
|
|
16.8
|
|
43%
|
|
83.4
|
|
65.1
|
|
28%
|
|
Adjusted EBIT
Margin
|
|
9.1%
|
|
6.0%
|
|
310
bps
|
|
7.8%
|
|
5.6%
|
|
220
bps
|
|
Depreciation and amortization
|
|
3.4
|
|
4.4
|
|
|
|
17.8
|
|
17.4
|
|
|
|
Adjusted
EBITDA
|
|
27.5
|
|
21.2
|
|
30%
|
|
101.2
|
|
82.5
|
|
23%
|
|
Adjusted EBITDA
Margin
|
|
10.4%
|
|
7.6%
|
|
280
bps
|
|
9.5%
|
|
7.1%
|
|
240
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Specialized
Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$
269.7
|
|
$
259.5
|
|
3.9%
|
|
$1,066.8
|
|
$1,056.3
|
|
1.0%
|
|
Total Sales (External
+ Inter-segment)
|
|
270.4
|
|
260.2
|
|
3.9%
|
|
1,070.0
|
|
1,059.0
|
|
1.0%
|
|
EBIT
|
|
48.9
|
|
47.5
|
|
3%
|
|
170.5
|
|
189.0
|
|
(10%)
|
|
EBIT
Margin
|
|
18.1%
|
|
18.3%
|
|
(20)
bps
|
|
15.9%
|
|
17.8%
|
|
(190)
bps
|
|
Depreciation and amortization
|
|
10.8
|
|
10.3
|
|
|
|
41.8
|
|
39.0
|
|
|
|
EBITDA
|
|
59.7
|
|
57.8
|
|
3%
|
|
212.3
|
|
228.0
|
|
(7%)
|
|
EBITDA
Margin
|
|
22.1%
|
|
22.2%
|
|
(10)
bps
|
|
19.8%
|
|
21.5%
|
|
(170)
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
External
Sales
|
|
$1,144.9
|
|
$1,046.7
|
|
9.4%
|
|
$4,752.5
|
|
$4,269.5
|
|
11.3%
|
|
EBIT -
segments
|
|
133.1
|
|
84.4
|
|
58%
|
|
512.0
|
|
439.8
|
|
16%
|
|
Intersegment eliminations and other
|
|
2.0
|
|
(0.4)
|
|
|
|
1.4
|
|
(2.9)
|
|
|
|
EBIT
|
|
135.1
|
|
84.0
|
|
61%
|
|
513.4
|
|
436.9
|
|
18%
|
|
EBIT
Margin
|
|
11.8%
|
|
8.0%
|
|
380
bps
|
|
10.8%
|
|
10.2%
|
|
60
bps
|
|
Restructuring-related charges 3
|
|
5.0
|
|
16.3
|
|
|
|
15.1
|
|
16.3
|
|
|
|
ECS
transaction costs 3
|
|
—
|
|
3.7
|
|
|
|
0.9
|
|
3.7
|
|
|
|
Note
impairment 3
|
|
—
|
|
15.9
|
|
|
|
—
|
|
15.9
|
|
|
|
Adjusted EBIT
3
|
|
140.1
|
|
120.0
|
|
17%
|
|
529.4
|
|
472.9
|
|
12%
|
|
Adjusted EBIT
Margin3
|
|
12.2%
|
|
11.5%
|
|
70
bps
|
|
11.1%
|
|
11.1%
|
|
0
bps
|
|
Depreciation and amortization - segments
|
|
43.6
|
|
29.5
|
|
|
|
174.8
|
|
113.3
|
|
|
|
Depreciation and amortization - unallocated 4
|
|
3.6
|
|
5.6
|
|
|
|
17.1
|
|
22.8
|
|
|
|
Adjusted EBITDA
3
|
|
187.3
|
|
155.1
|
|
21%
|
|
721.3
|
|
609.0
|
|
18%
|
|
Adjusted EBITDA
Margin3
|
|
16.4%
|
|
14.8%
|
|
160
bps
|
|
15.2%
|
|
14.3%
|
|
90
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LAST SIX
QUARTERS
|
|
2018
|
|
2019
|
|
Selected
Figures
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
|
4Q
|
|
Net Sales ($
million)
|
|
1,092
|
|
1,047
|
|
1,155
|
|
1,213
|
|
1,239
|
|
1,145
|
|
Sales Growth (vs.
prior year)
|
|
8%
|
|
6%
|
|
12%
|
|
10%
|
|
14%
|
|
9%
|
|
Volume Growth (same
locations vs. prior year)
|
|
3%
|
|
—%
|
|
(3%)
|
|
(6%)
|
|
(1%)
|
|
(1%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT
3($ million)
|
|
124
|
|
120
|
|
105
|
|
136
|
|
148
|
|
140
|
|
Cash from Operations
($ million)
|
|
127
|
|
189
|
|
31
|
|
172
|
|
213
|
|
251
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(trailing twelve months) 3($ million)
|
|
598
|
|
609
|
|
620
|
|
651
|
|
689
|
|
721
|
|
(Long-term debt +
current maturities) / Adj. EBITDA 3,5
|
|
2.3
|
|
1.9
|
|
4.0
|
|
3.7
|
|
3.3
|
|
2.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Sales (vs.
prior year)
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
|
4Q
|
|
Residential
Products
|
|
3%
|
|
5%
|
|
3%
|
|
(1%)
|
|
3%
|
|
(1%)
|
|
Industrial
Products
|
|
28%
|
|
22%
|
|
10%
|
|
(9%)
|
|
(17%)
|
|
(24%)
|
|
Furniture
Products
|
|
4%
|
|
(1%)
|
|
(5%)
|
|
(11%)
|
|
(8%)
|
|
(5%)
|
|
Specialized
Products
|
|
3%
|
|
—%
|
|
(5%)
|
|
(3%)
|
|
6%
|
|
4%
|
|
Overall
|
|
6%
|
|
3%
|
|
(1%)
|
|
(6%)
|
|
(2%)
|
|
(4%)
|
|
|
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
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full
Year
|
|
2018
|
|
2019
|
Non-GAAP
adjustments 6
|
|
2018
|
|
2019
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
|
4Q
|
Restructuring-related
charges
|
|
16.3
|
|
15.1
|
|
-
|
|
16.3
|
|
6.3
|
|
-
|
|
3.8
|
|
5.0
|
Note
impairment
|
|
15.9
|
|
-
|
|
-
|
|
15.9
|
|
-
|
|
-
|
|
-
|
|
-
|
ECS transaction
costs
|
|
6.9
|
|
0.9
|
|
-
|
|
6.9
|
|
0.9
|
|
-
|
|
-
|
|
-
|
Non-GAAP
adjustments (pretax) 7
|
|
39.1
|
|
16.0
|
|
-
|
|
39.1
|
|
7.2
|
|
-
|
|
3.8
|
|
5.0
|
Income tax
impact
|
|
(7.5)
|
|
(2.3)
|
|
-
|
|
(7.5)
|
|
(1.8)
|
|
-
|
|
(0.4)
|
|
(0.1)
|
Tax Cuts and Jobs Act
impact
|
|
(1.8)
|
|
-
|
|
(1.8)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Non-GAAP
adjustments (after tax)
|
|
29.8
|
|
13.7
|
|
(1.8)
|
|
31.6
|
|
5.4
|
|
-
|
|
3.4
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares
outstanding
|
|
135.2
|
|
135.4
|
|
134.7
|
|
134.7
|
|
135.0
|
|
135.2
|
|
135.4
|
|
135.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS impact of
non-GAAP adjustments
|
|
0.22
|
|
0.10
|
|
(0.01)
|
|
0.23
|
|
0.04
|
|
-
|
|
0.02
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full
Year
|
|
2018
|
|
2019
|
Adjusted EBIT,
EBITDA, Margin, and EPS 6
|
|
2018
|
|
2019
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
|
4Q
|
Net
sales
|
|
4,270
|
|
4,753
|
|
1,092
|
|
1,047
|
|
1,155
|
|
1,213
|
|
1,239
|
|
1,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT (earnings before
interest and taxes)
|
|
436.9
|
|
513.4
|
|
124.4
|
|
84.0
|
|
98.2
|
|
136.0
|
|
144.1
|
|
135.1
|
Non-GAAP adjustments
(pretax and excluding interest) 8
|
|
36.0
|
|
16.0
|
|
-
|
|
36.0
|
|
7.2
|
|
-
|
|
3.8
|
|
5.0
|
Adjusted EBIT ($
millions)
|
|
472.9
|
|
529.4
|
|
124.4
|
|
120.0
|
|
105.4
|
|
136.0
|
|
147.9
|
|
140.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
margin
|
|
10.2%
|
|
10.8%
|
|
11.4%
|
|
8.0%
|
|
8.5%
|
|
11.2%
|
|
11.6%
|
|
11.8%
|
Adjusted EBIT
margin
|
|
11.1%
|
|
11.1%
|
|
11.4%
|
|
11.5%
|
|
9.1%
|
|
11.2%
|
|
11.9%
|
|
12.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
|
|
436.9
|
|
513.4
|
|
124.4
|
|
84.0
|
|
98.2
|
|
136.0
|
|
144.1
|
|
135.1
|
Depreciation and
Amortization
|
|
136.1
|
|
191.9
|
|
33.8
|
|
35.1
|
|
46.3
|
|
50.0
|
|
48.4
|
|
47.2
|
EBITDA
|
|
573.0
|
|
705.3
|
|
158.2
|
|
119.1
|
|
144.5
|
|
186.0
|
|
192.5
|
|
182.3
|
Non-GAAP adjustments
(pretax and excluding interest) 8
|
|
36.0
|
|
16.0
|
|
-
|
|
36.0
|
|
7.2
|
|
-
|
|
3.8
|
|
5.0
|
Adjusted EBITDA ($
millions)
|
|
609.0
|
|
721.3
|
|
158.2
|
|
155.1
|
|
151.7
|
|
186.0
|
|
196.3
|
|
187.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
margin
|
|
13.4%
|
|
14.8%
|
|
14.5%
|
|
11.4%
|
|
12.5%
|
|
15.3%
|
|
15.5%
|
|
15.9%
|
Adjusted EBITDA
margin
|
|
14.3%
|
|
15.2%
|
|
14.5%
|
|
14.8%
|
|
13.1%
|
|
15.3%
|
|
15.8%
|
|
16.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
EPS
|
|
2.26
|
|
2.47
|
|
0.67
|
|
0.39
|
|
0.45
|
|
0.64
|
|
0.74
|
|
0.64
|
EPS impact of
non-GAAP adjustments
|
|
0.22
|
|
0.10
|
|
(0.01)
|
|
0.23
|
|
0.04
|
|
-
|
|
0.02
|
|
0.04
|
Adjusted EPS
($)
|
|
2.48
|
|
2.57
|
|
0.66
|
|
0.62
|
|
0.49
|
|
0.64
|
|
0.76
|
|
0.68
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full
Year
|
|
2018
|
|
2019
|
Total Debt to
Adjusted EBITDA 9
|
|
2018
|
|
2019
|
|
3Q
|
|
4Q
|
|
1Q
|
|
2Q
|
|
3Q
|
|
4Q
|
Total Debt
|
|
1,169
|
|
2,118
|
|
1,357
|
|
1,169
|
|
2,461
|
|
2,415
|
|
2,248
|
|
2,118
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA,
trailing 12 months
|
|
609
|
|
721
|
|
598
|
|
609
|
|
620
|
|
651
|
|
689
|
|
721
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Debt /
Leggett Reported 12-month Adjusted EBITDA
|
|
1.9
|
|
2.9
|
|
2.3
|
|
1.9
|
|
4.0
|
|
3.7
|
|
3.3
|
|
2.9
|
Total Debt /
Leggett and ECS 12-month Pro Forma Adjusted EBITDA
10
|
|
|
|
|
|
|
|
|
|
3.56
|
|
3.45
|
|
3.15
|
|
2.93
|
|
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. 4Q 2019: $4.9
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, September 30, and December 31, 2019 is
presented in the table below. Because the increase in total
debt from December 31, 2018 to December 31, 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,
September 30, and December 31, 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
|
|
1/1/19 –
1/16/19
|
Net
earnings
|
|
12
|
|
6
|
|
-
|
|
(1)
|
Interest
expense
|
|
33
|
|
22
|
|
12
|
|
1
|
Taxes
|
|
6
|
|
4
|
|
1
|
|
0
|
EBIT
|
|
51
|
|
32
|
|
13
|
|
-
|
Depreciation and
Amortization
|
|
14
|
|
10
|
|
5
|
|
1
|
Change in control
bonus
|
|
7
|
|
7
|
|
7
|
|
-
|
Adjusted
EBITDA
|
|
72
|
|
49
|
|
25
|
|
1
|
|
|
|
|
|
|
|
|
|
Leggett
Adjusted EBITDA, trailing 12 months (including ECS from January 16,
2019)
|
|
620
|
|
651
|
|
689
|
|
721
|
ECS
pre-acquisition adjusted EBITDA
|
|
72
|
|
49
|
|
25
|
|
1
|
Leggett
and ECS Pro Forma Adjusted EBITDA, trailing 12 months
|
|
692
|
|
700
|
|
714
|
|
722
|
Total Debt
/ Leggett and ECS 12-month Pro Forma Adjusted EBITDA
|
|
3.56
|
|
3.45
|
|
3.15
|
|
2.93
|
|
11Calculations impacted by
rounding.
|
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SOURCE Leggett & Platt