The Toro Company (NYSE: TTC) today announced additional
proactive actions it is taking to mitigate anticipated impacts of
the COVID-19 pandemic on its business.
Richard M. Olson, The Toro Company’s chairman and chief
executive officer said, “With the continued proliferation of
COVID-19, we remain first and foremost focused on the health,
safety and well-being of our employees, customers and communities.
I am inspired by the resilience, collaboration and passion of our
team as we work through the unpredictability of this pandemic. The
Toro Company has strong underlying fundamentals and is in a solid
financial position. We have a stable balance sheet and sufficient
liquidity. However, like many other companies that are navigating
the uncertainty of this pandemic, particularly as it relates to its
duration and scope, we have experienced production and supply chain
disruptions and reduced demand in certain of our businesses. As
such, it is prudent for us to take additional proactive actions now
to help mitigate anticipated impacts of the COVID-19 pandemic on
our business and financial performance. The additional actions we
are taking today will enable us to effectively manage through this
challenging environment with agility and position us well for the
recovery.”
The compensation of the company’s senior leadership, including
all executive officers, and the Board of Directors is adjusted as
follows for the rest of fiscal 2020:
- Salary for Richard M. Olson, chairman and CEO, is reduced by
30%. Additionally, Mr. Olson will make a voluntary personal
donation to the Melrose/Hoffman Employee Critical Need Fund which
was established in 2005 to help The Toro Company employees that are
experiencing financial hardship.
- Salaries for members of the executive leadership team are
reduced by 20%.
- Salaries for all other executive officers, general managers and
certain other senior leaders, are reduced by 10%.
- The Board of Directors will forgo the cash portion of their
compensation and instead donate the pay to the Melrose/Hoffman
Employee Critical Need Fund for the benefit of The Toro Company
employees.
Additional measures the company is taking include:
- Reducing salaries for US-based exempt office employees by 3.5%
and the workweek for US-based nonexempt office employees to 37
hours per week, each for the rest of fiscal 2020. This is
equivalent to a reduction that otherwise would have been realized
through a five-day furlough.
- Eliminating the 2020 discretionary investment fund contribution
under the company’s retirement plan that would be paid in
2021.
- Eliminating additional broad-based fiscal 2020 merit
increases.
- Continuing a hiring freeze on most positions.
The company will continue to monitor the impact of COVID-19 and
may adjust its action plans accordingly as the situation
progresses. As disclosed previously, the company has already
curtailed share repurchases for fiscal 2020 as it focuses on debt
repayment.
As a reminder, on March 30, 2020, the company announced that it
withdrew its fiscal 2020 second-quarter and full-year guidance. The
company will provide additional business updates during its fiscal
2020 second-quarter earnings announcement and conference call that
is expected to be held on June 4, 2020.
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 $3.1 billion in fiscal
2019, 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, Ventrac, American Augers, Subsite
Electronics, HammerHead, Trencor, Unique Lighting Systems,
Irritrol, Hayter, Pope, Lawn-Boy 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.
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 the company’s operating results or
financial position include: COVID-19 related factors, risks and
challenges, including among others, the length of time that the
pandemic continues, its effect on the demand for the company’s
products and services, the ability of dealers and retailers that
sell the company’s products to remain open, availability of
employees and their ability to conduct work away from normal
working locations and/or under revised protocols, and the ability
to receive commodities, components, parts, and accessories on a
timely basis through its supply chain and at anticipated costs, and
the ability of the company to continue its production operations;
worldwide economic conditions, including slow or negative growth
rates in global and domestic economies and weakened consumer
confidence; disruption at its manufacturing or distribution
facilities; fluctuations in the cost and availability of
commodities, components, parts, and accessories, including steel,
engines, hydraulics and resins; the effect of abnormal weather
patterns, including unfavorable weather conditions exacerbated by
global climate change or otherwise; the effect of natural disasters
and global pandemics, including COVID-19; the level of growth or
contraction in its key markets; customer, government and municipal
revenue, budget and spending levels; loss of any substantial
customer, including mass retailers and home centers for the
company’s residential business; elimination of shelf space for its
products at dealers or retailers; inventory adjustments or changes
in purchasing patterns by customers; the company’s 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 the company manufactures or sells its
products, or trade regulation and/or industry activity; foreign
currency exchange rate fluctuations; relationships with the
company’s distribution channel partners, including the financial
viability of distributors and dealers; risks associated with
acquisitions, including those related to the recent acquisitions of
Charles Machine Works and Venture Products, Inc., such as delays or
failure in achieving the net sales, earnings and cost or revenue
synergies expected from acquisitions, delays and challenges in
integrating the businesses, business disruptions due to
acquisitions, impacts as a result of purchase accounting
adjustments and unanticipated liabilities or exposures for which
the company has not been indemnified or may not recover; impairment
of goodwill or other intangible assets; delays or failures in
implementing, and unanticipated charges, as a result of,
restructuring activities; management of 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 COVID-19, 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 the company’s most recent annual report on Form 10-K,
subsequent quarterly reports on Form 10-Q or current reports on
Form 8-K, and other filings with the Securities and Exchange
Commission. The company makes 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.
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version on businesswire.com: https://www.businesswire.com/news/home/20200430005262/en/
Investor Relations Nicholas Rhoads Managing Director,
Investor Relations (952) 887-8865, nicholas.rhoads@toro.com
Media Relations Branden Happel Senior Manager, Public
Relations (952) 887-8930, branden.happel@toro.com
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