Printer Friendly

TORO REPORTS PROFITABLE SECOND QUARTER ON LOWER SALES

 BLOOMINGTON, Minn., Feb. 18 /PRNewswire/ -- The Toro Company (NYSE: TTC) today reported net earnings of 15 cents per share for its second quarter, reversing a year-earlier quarter loss. Toro Chairman and Chief Executive Officer Kendrick B. Melrose said, "Initiatives implemented during fiscal 1992 to improve competitiveness and profitability were major factors, most notably the restructuring of the consumer and irrigation businesses, aggressive cost reduction measures and lower price points for much of our lawn and garden line."
 For the second quarter ended Jan. 29, 1993, Toro reported net earnings of $1.8 million or 15 cents per share vs. a net loss of $11.9 million or $1.00 per share in the year-ago quarter. The company said the year-earlier quarter included an after-tax charge of $10.2 million or 85 cents per share associated with the restructuring of the consumer products business. Sales in the second quarter of fiscal 1993 were $153.2 million, compared to $161.2 million in the year-ago quarter.
 For the six-month period, Toro reported a net loss of $2.3 million or 19 cents per share. That compares with a net loss of $18.1 million or $1.51 per share for the year-ago period. Sales for the first six months were $266.6 million vs. $279.8 million for the same period a year ago.
 "Our overall performance for the quarter was gratifying," said Melrose. "Sales were lower than the year-ago quarter but higher than expected as we continued to manage down field inventories and prepare for new product introductions across our product lines in the third quarter. Our shipping patterns have also changed as we are selling more product through the mass retailer channel and shipping products closer to the selling season."
 Melrose also noted that the reduction in excess manufacturing capacity achieved during the last 18 to 24 months and improved product mix contributed to an improvement in gross margin to 35.1 percent from 33.1 percent last year.
 Commercial equipment sales continued very strong, rising more than 13 percent worldwide in the quarter. As expected, domestic sales outpaced international sales in the quarter due to the underlying strength of the golf market, the company said.
 Domestic irrigation sales also continued to show good progress, rising about 20 percent in the second quarter vs. the year-ago quarter while worldwide sales were off 3.5 percent. The domestic sales gain was due primarily to a more normal level of business, the company reported.
 Worldwide consumer product sales were down 14 percent for the quarter compared with a year ago. The lower sales volume was expected due to the major new product initiatives described earlier. Lawn-Boy product sales continued to benefit from an aggressive promotion initiated late last year, the company said. Melrose said that although consumer sales are running behind last year, the business is much healthier today and the longer term outlook is significantly better than a year ago.
 Total sales to international markets were down 24 percent for the quarter, primarily because the company was preparing for new product introductions in the third quarter. Softer golf market sales in Japan and Europe were partially offset by strong activity in the Far East and Canada.
 Selling, general and administrative expense levels were 8.3 percent below the year-ago quarter before restructuring charges, reflecting the impact of aggressive spending controls across the company. Interest expense was also down 4.3 percent in the quarter.
 Melrose noted that Toro continued to strengthen its balance sheet. He pointed out that cash flow increased due to the company's restructuring activities, improved asset management and return to profit ability in the quarter, and that total borrowings declined to $179 million from $205 million a year earlier.
 "We are pleased with our progress to date, and we are increasingly confident that we will achieve a substantial return to profitability for the year. We expect strong sales gains in the second half of the year as a result of the shift in our sales pattern to the third and fourth quarters, however, the extent of our success will be greatly affected by the outcome of our marketing programs, weather, the economy and the consumer's willingness to invest in new lawn and garden equipment," Melrose said.
 The Toro Company is the leading provider of lawn and turf care products for residential and commercial markets.
 To receive The Toro Company's latest news release and other corporate documents, free of charge via fax, simply dial 1-800-PRO-INFO. Use company code 154.
 THE TORO COMPANY AND SUBSIDIARIES
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
 (Dollars in thousands, except per-share data)
 THREE MONTHS ENDED SIX MONTHS ENDED
 Jan. 29, Jan. 31, Jan. 29, Jan. 31,
 1993 1992 1993 1992
 Net sales $153,172 $161,240 $266,615 $279,757
 Cost of sales 99,463 107,800 174,018 185,008
 GROSS PROFIT 53,709 53,440 92,597 94,749
 Selling, general and
 administrative expense 47,727 52,067 90,636 102,535
 Restructuring expense -- 15,000 -- 15,000
 Earnings (loss) from
 operations 5,982 (13,627) 1,961 (22,786)
 Interest expense 4,226 4,417 8,410 8,990
 Other (income) expense,
 net (1,173) (1,222) (2,707) (5,171)
 Earnings (loss) before
 income taxes 2,929 (16,822) (3,742) 26,605
 Provision (benefit) for
 income taxes 1,113 (4,894) (1,422) (8,514)
 NET EARNINGS (loss) $ 1,816 $(11,928) $(2,320) $ (18,091)
 Percent of net sales 1.18 (7.40) (.87) (6.47)
 Net earnings (loss)
 per common and common
 share equivalent $0.15 $(1.00) $(0.19) $(1.51)
 Common and common
 share equivalents 12,362 11,956 12,048 11,946
 Certain prior year amounts have been reclassified in conform with the current year presentation.
 SALES BY PRODUCT LINE (UNAUDITED)
 (DOLLARS IN THOUSANDS)
 THREE MONTHS ENDED SIX MONTHS ENDED
 Jan. 29, Jan. 31, Jan. 29, Jan. 31,
 1993 1992 1993 1992
 Consumer products $82,188 $95,126 $141,361 $165,147
 Commercial products 48,766 43,080 78,762 71,136
 Irrigation products 22,218 23,034 46,492 43,474
 TOTAL (A) $153,172 $161,240 $266,615 $279,757
 (A) includes inter-
 national sales of $ 26,321 $ 34,652 $ 42,660 $ 49,927
 THE TORO COMPANY AND SUBSIDIARIES
 CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
 (Dollars in thousands)
 ASSETS Jan. 29, 1993 Jan. 31, 1992
 Cash $ 4,684 $ 10,658
 Receivables (net) 203,965 212,430
 Inventories 119,557 122,719
 Prepaid expenses 25,754 31,385
 Total current assets 353,960 377,192
 Property, plant and equipment, net 65,985 74,556
 Other assets 18,543 20,806
 Total assets $438,488 $472,554
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current portion of long-term debt $16,140 $11,185
 Short-term debt 15,000 40,000
 Accounts payable 33,157 32,430
 Other accrued liabilities 96,846 90,430
 Total current liabilities 161,143 174,045
 Deferred income taxes 2,509 4,146
 Long-term debt, less
 current portion 147,960 154,110
 STOCKHOLDERS' EQUITY 126,876 140,253
 Total liabilities and
 stockholders' equity $438,488 $472,554
 -0- 2/18/93
 /CONTACT: Dennis Himan, VP-treasurer, 612-887-8411, or Stephen Keating, assistant treasurer, 612-887-8526, both for Toro; or Fred Nachman (Chicago), 312-266-7800, or Karen Griffiths 212-661-8030 (New York), both of the Financial Relations Board for Toro/
 (TTC)


CO: The Toro Company ST: Minnesota IN: SU: ERN

KH -- MN004 -- 7901 02/18/93 12:35 EST
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Feb 18, 1993
Words:1237
Previous Article:WARNER B.? PROMOTES CHARLOTTE KANDELTO SENIOR VICE PRESIDENT OF WORLDWIDE PUBLICITY AND PROMOTION
Next Article:EMPI SALES, NET INCOME SET RECORDS FOR 1992 FOURTH QUARTER AND FULL YEAR
Topics:


Related Articles
TORO REPORTS RESTRUCTURING CHARGE OF $15 MILLION; SECOND QUARTER EARNINGS
TORO EXPECTS LOSS IN FOURTH QUARTER: WILL TAKE CHARGES FOR PROPOSED FACILITY CLOSINGS
THE TORO COMPANY REPORTS FISCAL 1992 RESULTS
THE TORO COMPANY REPORTS FIRST QUARTER RESULTS
TORO RETURNS TO PROFITABILITY IN FISCAL 1993; ALL BUSINESSES RECORD A SIGNIFICANT IMPROVEMENT IN SALES AND OPERATING EARNINGS
THE TORO COMPANY REPORTS SECOND QUARTER NET INCOME MORE THAN DOUBLED ON 23.7 PERCENT RISE IN NET SALES
Toro Announces Record Second Quarter
Toro Revises First Quarter Due to Lower than Expected Sales
Toro First Quarter Up Due to Snowthrower Sales, Preseason Orders of New Toro Personal Pace(R) Lawn Mowers, and Sales of New Professional Products.
Toro Exceeds 2Q Profit Expectations and Raises Full Year Outlook; Announces Campaign to Bring Profitability to New Level.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters