- Strength of Charles Machine Works drives third quarter sales
increase of 27.9 percent to $838.7 million
- On track to achieve acquisition integration and synergy
targets
- Reported quarterly EPS of $0.56; adjusted quarterly EPS of
$0.83
- Full-year adjusted EPS guidance narrowed to about $2.92 to
$3.00 from about $2.90 to $3.00
The Toro Company (NYSE: TTC) today reported net earnings of
$60.6 million, or $0.56 per share, on a net sales increase of 27.9
percent to $838.7 million for its third quarter ended August 2,
2019. In the comparable fiscal 2018 period, the company delivered
net earnings of $79.0 million, or $0.73 per share, on net sales of
$655.8 million. Adjusted 2019 third quarter net earnings were $89.8
million, or $0.83 per share, compared to adjusted net earnings of
$73.5 million, or $0.68 per share in the comparable 2018 period, an
increase of 22.1 percent.
For the first nine months, Toro reported net earnings of $235.7
million, or $2.18 per share, on a net sales increase of 15.6
percent to $2,403.7 million. For the first nine months, adjusted
net earnings were $272.4 million, or $2.52 per share, compared to
adjusted net earnings of $255.9 million, or $2.35 per share, in the
comparable 2018 period, an increase of 7.2 percent. Please see the
tables for a reconciliation of financial measures calculated and
reported in accordance with GAAP, as well as adjusted non-GAAP
financial measures.
"Third quarter revenue growth was driven by the addition of the
Charles Machine Works portfolio as integration continues to
progress as planned," said Richard M. Olson, Toro's chairman and
chief executive officer. "The entire team has been collaboratively
working to optimize the combined enterprise, with a focus on
consistent execution, an unwavering commitment to innovation and a
focus on customer relationships. I am proud of our team's progress
to date."
"As mentioned earlier this month, we have launched a new
strategy for our underground businesses, which will enable us to
satisfy customer needs more effectively, while also capturing
manufacturing and operational efficiencies. This is one example of
many, where we have been able to move quickly and decisively to
eliminate redundancies and align priorities. Integration continues
to go well, and we are encouraged by the progress we have made
since we announced the acquisition earlier this year.”
“As anticipated, we are seeing gross margin improvement in the
second half of the fiscal year and we expect that positive momentum
to continue in the months ahead. Commodity costs have begun to
moderate and we have been able to achieve strategic pricing
realization. Additionally, prudent expense management contributed
to the favorable quarterly results."
"We are encouraged by preseason snow shipments already taking
place. Both our residential and BOSS® snow and ice management
businesses are well-positioned with exciting new product lineups.
As we look ahead, we are mindful of challenging weather conditions
and the trade policy environment the entire market is experiencing.
In addition, as we proactively manage inventory levels, we expect
to experience some unfavorable manufacturing variance in the fourth
quarter. For these reasons, we are modifying our full-year revenue
guidance and narrowing the bottom end of our full-year adjusted net
EPS range to reflect the solid performance we have achieved
year-to-date, while holding the top of the range to reflect the
variables we have outlined."
For the full-year, we now expect revenue to exceed $3.1 billion
and we have narrowed our adjusted net earnings per share guidance
to about $2.92 to $3.00 from about $2.90 to $3.00.
SEGMENT RESULTS
Professional
- Professional segment net sales for the third quarter were
$676.8 million, up 40.3 percent from $482.5 million last year. For
the first nine months, professional segment net sales were $1,855.3
million, up 20.0 percent from the comparable 2018 period. For the
quarter, the addition of Charles Machine Works and growth in our
BOSS, rental and specialty construction businesses, all contributed
to the results. Somewhat offsetting the growth for the quarter,
were lower shipments of landscape contractor and irrigation
products, due to poor weather conditions in key regions. For the
first nine months, the addition of Charles Machine Works, as well
as growth in our landscape contractor and BOSS businesses, drove
the positive results. Somewhat offsetting the growth in the period,
were lower shipments of irrigation products, due to poor weather
conditions in key regions.
- Professional segment earnings for the third quarter were $81.6
million, down 16.5 percent from $97.7 million in the same period
last year. Professional segment earnings for the first nine months
were $319.7 million, down 5.6 percent from $338.6 million compared
to the same period last year. The segment earnings for both periods
reflect the impact of purchase accounting adjustments related to
the acquisition of Charles Machine Works, as well as charges
incurred as a result of the wind down of the Toro-branded large
horizontal directional drill and riding trencher product
lines.
Residential
- Residential segment net sales for the third quarter were $148.2
million, down 11.0 percent from $166.5 million last year. For the
first nine months, residential segment net sales were $525.5
million, up 0.8 percent from $521.2 million last year. For the
quarter, strong pre-season snow thrower shipments were more than
offset by soft zero-turn riding and walk power mower sales, which
contributed to the revenue decline. For the first nine months,
higher sales of snow product and walk power mowers drove the slight
revenue increase, somewhat offset by lower shipments of zero-turn
riding mower products for the period.
- Residential segment earnings for the third quarter were $16.2
million, up 0.9 percent from $16.0 million in the comparable period
last year. Residential segment earnings for the first nine months
were $51.3 million, down 11.7 percent from $58.0 million in the
same period last year. The increase for the quarter was driven by
favorable price realization and productivity efforts. For the first
nine months, the decline was largely due to the unfavorable impacts
of tariff and trade-related cost increases, partially offset by net
price realization and productivity initiatives.
OPERATING RESULTS
Reported gross margin for the third quarter was 31.7 percent, a
decrease of 390 basis points compared to the prior year. Adjusted
gross margin for the third quarter was 35.9 percent, an increase of
30 basis points compared to last year. For the first nine months,
reported gross margin was 33.4 percent, a decrease of 320 basis
points over the prior year. Adjusted gross margin for the first
nine months was 35.3 percent, a decrease of 130 basis points
compared to last year. For both periods, increased inflation and
tariff-related costs and product mix contributed to the reported
gross margin decline, partially offset by pricing and productivity
improvements.
Selling, general and administrative (SG&A) expense as a
percent of sales for the third quarter was 22.9 percent, an
increase of 150 basis points from the same period last year. For
the first nine months, SG&A expense as a percent of sales was
21.7 percent, an increase of 100 basis points. For both periods,
acquisition integration and one-time transaction costs contributed
to the increases compared to the respective periods last year.
Third quarter reported operating earnings as a percent of sales
were 8.8 percent, a decrease of 540 basis points compared to 14.2
percent in the same period last year. Adjusted operating earnings
for the third quarter were 13.4 percent, a decrease of 80 basis
points compared to 14.2 percent last year. For the first nine
months, reported operating earnings as a percent of sales were 11.7
percent, a decrease of 420 basis points compared to 15.9 percent
last year. For the first nine months, adjusted operating earnings
as a percent of sales were 14.2 percent compared to 15.9 percent, a
decrease of 170 basis points compared to the prior year.
The effective tax rate for the third quarter was 14.9 percent,
compared to 15.3 percent for the third quarter of last year. The
adjusted tax rate for the third quarter was 18.1 percent, compared
to 21.2 percent last year. For the first nine months, the reported
tax rate was 15.3 percent, down from 29.2 percent in the comparable
period. The adjusted tax rate for the first nine months was 19.5
percent, compared to 22.2 percent for the same period last year.
The company now expects its full-year adjusted effective tax rate
to be about 20.0 percent.
Accounts receivable at the end of the third quarter were $312.2
million, up 42.3 percent from last year. Net inventories were
$620.6 million, up 70.3 percent from last year. Trade payables were
$304.7 million, up 33.0 percent from the comparable period last
year. These increases were largely due to the acquisition of
Charles Machine Works.
About The Toro Company The Toro Company (NYSE: TTC) is a
leading worldwide provider of innovative solutions for the outdoor
environment including turf and landscape maintenance, snow and ice
management, underground utility construction, rental and specialty
construction, and irrigation and outdoor lighting solutions. With
sales of $2.6 billion in fiscal 2018, The Toro Company’s global
presence extends to more than 125 countries through a family of
brands that includes Toro, Ditch Witch, Exmark, BOSS Snowplow,
American Augers, Subsite Electronics, HammerHead, Trencor, Unique
Lighting Systems, Irritrol, Hayter, Pope, Lawn-Boy, MTI Equipment
and Radius HDD. Through constant innovation and caring
relationships built on trust and integrity, The Toro Company and
its family of brands have built a legacy of excellence by helping
customers care for golf courses, sports fields, construction sites,
public green spaces, commercial and residential properties and
agricultural operations. For more information, visit www.thetorocompany.com.
LIVE CONFERENCE CALL August 22, 2019 at 10:00 a.m.
CDT www.thetorocompany.com/invest
The Toro Company will conduct its earnings call and webcast for
investors beginning at 10:00 a.m. CDT on August 22, 2019. The
webcast will be available at www.streetevents.com or at www.thetorocompany.com/invest. Webcast
participants will need to complete a brief registration form and
should allocate extra time before the webcast begins to register
and, if necessary, download and install audio software.
Use of Non-GAAP Financial Information This press release
and our related earnings call contain certain non-GAAP financial
measures, which are not calculated or presented in accordance with
U.S. GAAP, as information supplemental and in addition to the most
directly comparable financial measures calculated and presented in
accordance with U.S. GAAP. The non-GAAP financial measures included
within this press release and our related earnings call consist of
adjusted gross profit, operating earnings before income taxes,
operating earnings, net earnings, net earnings per diluted share
and effective tax rate, as measures of our operating
performance.
The Toro Company uses these non-GAAP financial measures in
making operating decisions because we believe these non-GAAP
financial measures provide meaningful supplemental information
regarding core operational performance and provide us with a better
understanding of how to allocate resources to both ongoing and
prospective business initiatives. Additionally, these non-GAAP
financial measures facilitate our internal comparisons to both our
historical operating results and our competitors' operating results
by factoring out potential differences caused by charges not
related to our regular ongoing business, including, without
limitation, non-cash charges, certain large and unpredictable
charges, acquisitions and dispositions, legal settlements, and tax
positions.
Reconciliations of adjusted non-GAAP measures to reported GAAP
measures are included in the financial tables contained in this
press release. These measures, however, should not be considered
superior to, as a substitute for, or as an alternative to, and
should be considered in conjunction with, the GAAP financial
measures included within this press release and our related
earnings call. These non-GAAP financial measures may differ from
similar measures used by other companies.
The Toro Company does not attempt to provide reconciliations of
forward-looking non-GAAP EPS guidance to projected GAAP EPS
guidance because the combined impact and timing of recognition of
these potential charges or gains is inherently uncertain and
difficult to predict and is unavailable without unreasonable
efforts. In addition, we believe such reconciliations would imply a
degree of precision and certainty that could be confusing to
investors. Such items could have a substantial impact on GAAP
measures of financial performance.
Forward-Looking Statements This news release contains
forward-looking statements, which are being made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. These forward-looking statements are based on
management’s current assumptions and expectations of future events,
and often can be identified by words such as “expect,” “strive,”
“looking ahead,” “outlook,” “guidance,” “forecast,” “goal,”
“optimistic,” “anticipate,” “continue,” “plan,” “estimate,”
“project,” “believe,” “should,” “could,” “will,” “would,”
“possible,” “may,” “likely,” “intend,” “can,” “seek,” “potential,”
“pro forma,” or the negative thereof or similar expressions.
Forward-looking statements involve risks and uncertainties that
could cause actual events and results to differ materially from
those projected or implied. Particular risks and uncertainties that
may affect our operating results or financial position include:
worldwide economic conditions, including slow or negative growth
rates in global and domestic economies and weakened consumer
confidence; disruption at our manufacturing or distribution
facilities, including drug cartel-related violence affecting our
maquiladora operations in Juarez, Mexico; fluctuations in the cost
and availability of raw materials and components, including steel,
engines, hydraulics and resins; the impact of abnormal weather
patterns, including unfavorable weather conditions exacerbated by
global climate change or otherwise; the impact of natural disasters
and global pandemics; the level of growth or contraction in our key
markets; government and municipal revenue, budget and spending
levels; dependence on The Home Depot as a customer for our
residential business; elimination of shelf space for our products
at dealers or retailers; inventory adjustments or changes in
purchasing patterns by our customers; our ability to develop and
achieve market acceptance for new products; increased competition;
the risks attendant to international relations, operations and
markets, including political, economic and/or social instability
and conflict, tax and trade policies in the U.S. and other
countries in which we manufacture or sell our products, and
implications of the United Kingdom’s process for exiting the
European Union; foreign currency exchange rate fluctuations; our
relationships with our distribution channel partners, including the
financial viability of our distributors and dealers; risks
associated with acquisitions, including those related to our recent
acquisition of Charles Machine Works, such as delays or failure by
us in achieving the net sales, earnings and cost or revenue
synergies expected from the acquisition, delays and challenges in
integrating the businesses, business disruptions due to the
acquisition, impacts as a result of purchase accounting adjustments
and unanticipated liabilities or exposures for which we have not
been indemnified or may not recover; delays or failures in
implementing, and unanticipated charges, as a result of, the new
underground business strategy; management of our alliances or joint
ventures, including Red Iron Acceptance, LLC; the costs and effects
of enactment of, changes in and compliance with laws, regulations
and standards, including those relating to consumer product safety,
accounting, taxation, trade and tariffs, healthcare, and
environmental, health and safety matters; unforeseen product
quality problems; loss of or changes in executive management or key
employees; the occurrence of litigation or claims, including those
involving intellectual property or product liability matters; and
other risks and uncertainties described in our most recent annual
report on Form 10-K, subsequent quarterly reports on Form 10-Q, and
other filings with the Securities and Exchange Commission. We make
no commitment to revise or update any forward-looking statements in
order to reflect events or circumstances occurring or existing
after the date any forward-looking statement is made.
THE TORO COMPANY AND
SUBSIDIARIES
Condensed Consolidated
Statements of Earnings (Unaudited)
(Dollars and shares in
thousands, except per-share data)
Three Months Ended
Nine Months Ended
August 2, 2019
August 3, 2018
August 2, 2019
August 3, 2018
Net sales
$
838,713
$
655,821
$
2,403,705
$
2,079,347
Gross profit
265,981
233,653
802,896
761,948
Gross margin
31.7
%
35.6
%
33.4
%
36.6
%
Selling, general and administrative
expense
192,037
140,759
521,173
431,859
Operating earnings
73,944
92,894
281,723
330,089
Interest expense
(9,004
)
(4,676
)
(20,440
)
(14,214
)
Other income, net
6,295
5,057
17,152
12,951
Earnings before income taxes
71,235
93,275
278,435
328,826
Provision for income taxes
10,628
14,266
42,718
95,924
Net earnings
$
60,607
$
79,009
$
235,717
$
232,902
Basic net earnings per share of common
stock
$
0.57
$
0.75
$
2.21
$
2.19
Diluted net earnings per share of common
stock
$
0.56
$
0.73
$
2.18
$
2.14
Weighted-average number of shares of
common stock outstanding — Basic
107,005
105,751
106,644
106,474
Weighted-average number of shares of
common stock outstanding — Diluted
108,253
108,070
108,024
108,930
Segment Data
(Unaudited)
(Dollars in thousands)
Three Months Ended
Nine Months Ended
Segment Net Sales
August 2, 2019
August 3, 2018
August 2, 2019
August 3, 2018
Professional
$
676,756
$
482,494
$
1,855,268
$
1,546,536
Residential
148,234
166,513
525,539
521,189
Other
13,723
6,814
22,898
11,622
Total net sales*
$
838,713
$
655,821
$
2,403,705
$
2,079,347
*Includes international net sales of:
$
186,710
$
142,534
$
547,332
$
496,403
Three Months Ended
Nine Months Ended
Segment Earnings (Loss)
August 2, 2019
August 3, 2018
August 2, 2019
August 3, 2018
Professional
$
81,592
$
97,716
$
319,689
$
338,607
Residential
16,151
16,002
51,253
58,019
Other
(26,508
)
(20,443
)
(92,507
)
(67,800
)
Total segment earnings
$
71,235
$
93,275
$
278,435
$
328,826
THE TORO COMPANY AND
SUBSIDIARIES
Condensed Consolidated Balance
Sheets (Unaudited)
(Dollars in thousands)
August 2, 2019
August 3, 2018
ASSETS
Cash and cash equivalents
$
143,317
$
250,871
Receivables, net
312,239
219,469
Inventories, net
620,612
364,497
Prepaid expenses and other current
assets
54,235
38,187
Total current assets
1,130,403
873,024
Property, plant and equipment, net
426,415
249,502
Deferred income taxes
3,603
43,590
Goodwill and other assets, net
749,312
368,641
Total assets
$
2,309,733
$
1,534,757
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of long-term debt
$
99,877
$
—
Short-term debt
—
—
Accounts payable
304,661
229,041
Accrued liabilities
351,865
282,634
Total current liabilities
756,403
511,675
Long-term debt, less current portion
620,804
312,481
Deferred income taxes
46,940
1,728
Other long-term liabilities
41,764
58,629
Total stockholders’ equity
843,822
650,244
Total liabilities and stockholders’
equity
$
2,309,733
$
1,534,757
THE TORO COMPANY AND
SUBSIDIARIES
Condensed Consolidated
Statements of Cash Flows (Unaudited)
(Dollars in thousands)
Nine Months Ended
August 2, 2019
August 3, 2018
Cash flows from operating activities:
Net earnings
$
235,717
$
232,902
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Non-cash income from finance affiliate
(9,135
)
(8,564
)
Distributions from finance affiliate,
net
6,569
6,162
Depreciation of property, plant and
equipment
48,770
36,183
Amortization of other intangible
assets
13,633
5,725
Fair value step-up adjustment to acquired
inventory
31,304
—
Stock-based compensation expense
10,258
8,588
Deferred income taxes
449
20,381
Other
4,440
(83
)
Changes in operating assets and
liabilities, net of effect of acquisitions:
Receivables, net
(54,446
)
(34,996
)
Inventories, net
(54,541
)
(33,554
)
Prepaid expenses and other assets
10,734
(6,065
)
Accounts payable, accrued liabilities,
deferred revenue and other long-term liabilities
15,361
32,690
Net cash provided by operating
activities
259,113
259,369
Cash flows from investing activities:
Purchases of property, plant and
equipment
(56,801
)
(51,938
)
Proceeds from asset disposals
4,636
—
Investment in unconsolidated entities
(150
)
(6,417
)
Acquisitions, net of cash acquired
(691,822
)
(31,202
)
Net cash used in investing activities
(744,137
)
(89,557
)
Cash flows from financing activities:
Borrowings under debt arrangements
900,000
—
Repayments under debt arrangements
(491,000
)
(19,757
)
Proceeds from exercise of stock
options
25,482
10,165
Payments of withholding taxes for stock
awards
(2,632
)
(3,884
)
Purchases of Toro common stock
(20,043
)
(151,481
)
Dividends paid on Toro common stock
(72,009
)
(63,808
)
Net cash provided by (used in) financing
activities
339,798
(228,765
)
Effect of exchange rates on cash and cash
equivalents
(581
)
(432
)
Net decrease in cash and cash
equivalents
(145,807
)
(59,385
)
Cash and cash equivalents as of the
beginning of the fiscal period
289,124
310,256
Cash and cash equivalents as of the end of
the fiscal period
$
143,317
$
250,871
THE TORO COMPANY AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures (Unaudited)
(Dollars in thousands, except per-share data)
The company has provided non-GAAP financial measures, which are
not calculated or presented in accordance with accounting
principles generally accepted in the United States ("GAAP"), as
information supplemental and in addition to the most directly
comparable financial measures presented in the accompanying press
release that are calculated and presented in accordance with GAAP.
The company uses these non-GAAP financial measures in making
operating decisions because the company believes these non-GAAP
financial measures provide meaningful supplemental information
regarding the company's core operational performance and provide
the company with a better understanding of how to allocate
resources to both ongoing and prospective business initiatives.
Additionally, these non-GAAP financial measures facilitate
management's internal comparisons to both the company's historical
operating results and to the company's competitors' operating
results by factoring out potential differences caused by charges
not related to the company's regular, ongoing business, including,
without limitation, non-cash charges, certain large and
unpredictable charges, acquisitions and dispositions, legal
settlements, and tax positions. Such non-GAAP financial measures
should not be considered superior to, as a substitute for, or as an
alternative to, and should be considered in conjunction with, the
GAAP financial measures presented in the accompanying press
release. The non-GAAP financial measures in the accompanying press
release may differ from similar measures used by other
companies.
The following table provides a reconciliation of financial
measures calculated and reported in accordance with GAAP, as well
as adjusted non-GAAP financial measures, in the accompanying press
release for the three and nine month periods ended August 2, 2019
and August 3, 2018:
Three Months Ended
Nine Months Ended
August 2, 2019
August 3, 2018
August 2, 2019
August 3, 2018
Gross profit
$
265,981
$
233,653
$
802,896
$
761,948
Management actions1
9,117
—
9,117
—
Acquisition-related costs2
26,172
—
35,691
—
Adjusted non-GAAP gross profit
$
301,270
$
233,653
$
847,704
$
761,948
Operating earnings
$
73,944
$
92,894
$
281,723
$
330,089
Management actions1
9,148
—
9,148
—
Acquisition-related costs2
29,304
—
51,058
—
Adjusted non-GAAP operating earnings
$
112,396
$
92,894
$
341,929
$
330,089
Earnings before income taxes
$
71,235
$
93,275
$
278,435
$
328,826
Management actions1
9,148
—
9,148
—
Acquisition-related costs2
29,304
—
51,058
—
Adjusted non-GAAP earnings before income
taxes
$
109,687
$
93,275
$
338,641
$
328,826
Net earnings
$
60,607
$
79,009
$
235,717
$
232,902
Management actions1
7,351
—
7,351
—
Acquisition-related costs2
23,953
—
41,814
—
Tax impact of share-based
compensation3
(1,200
)
(5,025
)
(11,518
)
(9,638
)
U.S. Tax Reform4
(926
)
(500
)
(926
)
32,613
Adjusted non-GAAP net earnings
$
89,785
$
73,484
$
272,438
$
255,877
Diluted EPS
$
0.56
$
0.73
$
2.18
$
2.14
Management actions1
0.07
—
0.07
—
Acquisition-related costs2
0.22
—
0.39
—
Tax impact of share-based
compensation3
(0.01
)
(0.05
)
(0.11
)
(0.09
)
U.S. Tax Reform4
(0.01
)
—
(0.01
)
0.30
Adjusted non-GAAP diluted EPS
$
0.83
$
0.68
$
2.52
$
2.35
Three Months Ended
Nine Months Ended
August 2, 2019
August 3, 2018
August 2, 2019
August 3, 2018
Effective tax rate
14.9
%
15.3
%
15.3
%
29.2
%
Management actions1
1.6
%
—
%
0.5
%
—
%
Acquisition-related costs2
(1.4
)%
—
%
(0.7
)%
—
%
Tax impact of share-based
compensation3
1.7
%
5.4
%
4.1
%
2.9
%
U.S. Tax Reform4
1.3
%
0.5
%
0.3
%
(9.9
)%
Adjusted non-GAAP effective tax rate
18.1
%
21.2
%
19.5
%
22.2
%
1 During the third quarter of fiscal 2019, the company announced
it will wind down its Toro-branded large horizontal directional
drill and riding trencher product line. These amounts represent
costs incurred in relation to such wind down and are primarily
comprised of costs related to the write-down of inventory,
anticipated inventory retail support activities, and accelerated
depreciation on fixed assets during the three and nine month
periods ended August 2, 2019.
2 During the second quarter of fiscal 2019, the company acquired
The Charles Machine Works, Inc. ("CMW"), a privately held Oklahoma
corporation. These amounts represent integration and transaction
costs, as well as the take-down of the inventory fair value step-up
amount and amortization of the backlog intangible asset resulting
from purchase accounting adjustments, related to the company's
acquisition of CMW during the three and nine month periods ended
August 2, 2019.
3 In the first quarter of fiscal 2017, the company adopted
Accounting Standards Update No. 2016-09, Stock-based Compensation:
Improvements to Employee Share-based Payment Accounting, which
requires that any excess tax deduction for share-based compensation
be immediately recorded within income tax expense. These amounts
represent the discrete tax benefits recorded as excess tax
deductions for share-based compensation during the three and nine
month periods ended August 2, 2019 and August 3, 2018.
4 Signed into law on December 22, 2017, the Tax Cuts and Jobs
Act ("Tax Act"), reduced the U.S. federal corporate tax rate from
35.0 percent to 21.0 percent, effective January 1, 2018, resulting
in a blended U.S. federal statutory tax rate of 23.3 percent for
the fiscal year ended October 31, 2018. This reduction in rate
required the re-measurement of the company's net deferred taxes as
of the date of enactment. The Tax Act also imposed a one-time
deemed repatriation tax on the company's historical undistributed
earnings and profits of foreign affiliates. During the three and
nine month periods ended August 2, 2019, the company recorded a tax
benefit of $0.9 million related to a prior year true-up of the Tax
Act. During the three and nine month periods ended August 3, 2018,
the remeasurement of the company's net deferred taxes and the
one-time deemed repatriation tax resulted in a combined benefit of
$0.5 million and a combined charge of $32.6 million.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190822005083/en/
Investor Relations Heather Hille Director, Investor
Relations (952) 887-8923, heather.hille@toro.com
Media Relations Branden Happel Senior
Manager, Public Relations (952) 887-8930,
branden.happel@toro.com
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