CARTHAGE, Mo., Jan. 28 /PRNewswire-FirstCall/ -- -- 4Q EPS of $.23;
sales were $770 million, 13% lower than in prior year. -- 4Q
adjusted EPS from Continuing Operations of $.30, excluding an
unusual international tax item. -- Full year earnings of $.70 per
share; sales were $3.06 billion, 25% lower than in the prior year.
-- Full year adjusted EPS from Continuing Operations of $.86,
excluding unusual items. -- Cash flow from operations of $565
million for the full year, the second-highest level ever. --
Repurchased 4.1 million shares during the quarter; net debt
remained at 23.7% of net capital. -- 2010 EPS guidance of $.75 -
1.15, on sales of $2.9 - 3.3 billion. Diversified manufacturer
Leggett & Platt reported fourth quarter earnings per diluted
share of $.23. Earnings from Continuing Operations, adjusted to
exclude an unusual tax item, were $.30 per share. In the fourth
quarter of 2008, adjusted earnings from Continuing Operations were
$.03 per share. Earnings improved, despite lower sales, as a result
of cost reduction efforts, pricing discipline, and a $.06 per share
LIFO benefit. Sales from Continuing Operations were $770 million,
13% lower than in the fourth quarter of 2008, with steel-related
price deflation accounting for the bulk of the decline; unit
volumes declined approximately 3%. Fourth Quarter Full Year
$/share: 2009 2008 2009 2008 -------- ---- ---- ---- ----
Continuing Operations, adjusted .30 .03 .86 .88 Unusual
Restructuring- related costs -- (.11) -- (.14) Unusual Tax and
Other items (.04) .03 (.12) (.01) ---- --- ---- ---- Continuing
Operations, as reported .26 (.05) .74 .73 Discontinued Operations
(.03) (.06) (.04) (.11) ---- ---- ---- ---- EPS, as reported .23
(.11) .70 .62 In millions: ------------ Diluted Shares 156.2 161.8
160.0 168.2 Sales, Continuing Operations, $770 883 3,055 4,076 Cash
from Operations, $135 233 565 436 Full Year Financial Results Full
year reported EPS was $.70 (including $.12 per share of expenses
due to three items: tax adjustments resulting from Mexican tax law
changes, bad debt expense related to a specific customer
bankruptcy, and the write-down of a note associated with the
Aluminum Segment divestiture). Per share adjusted earnings from
Continuing Operations were $.86 for the full year, a 2% decrease vs
2008; cost structure improvements and pricing discipline nearly
offset the earnings impact of extremely weak market demand. Full
year sales from Continuing Operations decreased 25% to $3.06
billion, largely due to unit volume decline. The company generated
$565 million of cash from operations during 2009, the
second-highest level ever, reflecting targeted efforts to optimize
working capital. Major uses of cash included $240 million to fund
dividends and capital requirements, $188 million (net) to purchase
Leggett stock, and $64 million (net) to reduce debt. Net debt to
net capital was 23.7% at year end, well below the company's 30% -
40% target range. Much Progress Despite Weak Economy President and
CEO David S. Haffner commented, "For the full year, Continuing
Operations EPS was relatively unchanged from the prior year,
despite a $1 billion (or 25%) decline in sales that was primarily
market-driven. Our significant cost reduction efforts and pricing
discipline allowed us to sustain EPS and improve margins, despite
the weak economy. Full year gross margin was 20.6%, the highest
level since the year 2000. Full year EBIT margin was 7.5%, an
improvement of 180 basis points over 2008. I am extremely pleased
with our employees' accomplishments in the face of such economic
headwind. "We continued to make notable progress on the key
strategic changes we outlined in November 2007. Consistent with our
stated intentions, during 2008 and 2009 combined, we: -- Generated
cash of over $1.4 billion from both operations ($1.0 billion) and
divestitures ($420 million). -- Increased quarterly dividends by
44% (from $.18 to $.26 per share). -- Bought back 15% (26 million
shares) of Leggett's outstanding stock. -- Reduced long-term net
debt to its lowest level (in dollars) in over a decade. -- Achieved
2-year Total Shareholder Return (TSR(1)) of 32%; within the top 4%
of all S&P 500 companies. "Our balance sheet and cash flow
remain strong, and our cost structure has improved significantly,
as margins indicate. We are very well positioned to ride out the
economic downturn, which we anticipate will continue throughout
2010. Whether the economy remains lackluster or unexpectedly
strengthens, our main financial objective remains to consistently
achieve TSR within the top 1/3 of the S&P 500, a goal we have
successfully achieved over the last two years." Dividend and Stock
Repurchases 2009 marked the 38th consecutive annual dividend
increase for Leggett, with a compound annual growth rate of over
14% during that period. At yesterday's closing share price of
$20.05, the indicated annual dividend of $1.04 per share generates
a dividend yield of 5.2%. During the fourth quarter, the company
repurchased 4.1 million shares of its stock at an average price of
$19.84 per share. For the full year, the company fully utilized its
authorization from the Board of Directors to repurchase 10 million
shares of its stock; as a result, shares outstanding declined by
7.0 million during 2009, to 148.8 million shares. 2010 Outlook
Leggett anticipates 2010 sales of approximately $2.9 - 3.3 billion,
reflecting the company's belief that the economy will likely remain
depressed. Based upon that sales expectation, and considering other
uncertainties including inflation, steel pricing, and margins,
Leggett projects that its Continuing Operations should generate
2010 EPS of $.75 - 1.15. LIFO All of Leggett's segments use the
FIFO (first-in, first-out) method for valuing inventories. An
adjustment is made at the corporate level to convert about 60% of
the inventories to the LIFO (last-in, first-out) method. Since the
LIFO benefit is not recorded at the segment level, 2009 segment
EBIT margins are unusually low. Steel cost decreases contributed to
a LIFO benefit of $67 million for the full year (for Continuing
Operations), which contrasts with $62 million of LIFO expense in
2008. Earnings for the fourth quarter reflect a LIFO benefit of
$14.8 million, compared to LIFO expense of $27.1 million in 4Q
2008. Furthermore, LIFO created significant variability in 2009
quarterly earnings. Steel deflation negatively impacted earnings
for the first half of 2009. This impact was offset by a LIFO
benefit, but that benefit was spread across all four quarters. Due
to the mismatch in quarterly timing of these two offsetting items,
fourth quarter earnings saw a $14.8 million LIFO benefit with no
corresponding steel deflation impact (because it occurred during
the first half of the year). LIFO-related impacts are not
anticipated to be as significant during 2010. SEGMENT RESULTS -
Fourth Quarter 2009 (versus 4Q 2008) Residential Furnishings -
Total sales decreased $44 million, or 10%, as a result of
steel-related price deflation; unit volume was up slightly. EBIT
(earnings before interest and income taxes) increased $31 million
due to cost reductions, price discipline, and absence of last
year's restructuring-related costs. Commercial Fixturing &
Components - Total sales decreased $35 million, or 25%, due to the
company's decision to walk away from sales with unacceptable profit
margins, market softness in office furniture components, and
reduced spending by retailers. EBIT increased $10 million, with the
earnings impact of lower sales more than offset by cost reductions,
operational improvements, and absence of last year's
restructuring-related costs. Industrial Materials - Total sales
decreased $56 million, or 26%, due to steel-related price
deflation; unit volume was up slightly. EBIT decreased $8 million,
with the impact of reduced metal margin partially offset by cost
reductions. Specialized Products - Total sales decreased $9
million, or 6%; weaker demand for machinery and Commercial Vehicle
Products was partially offset by improvement in automotive demand.
EBIT increased $13 million, primarily due to cost structure and
operational improvements. SEGMENT RESULTS - Full Year 2009 (versus
2008) Residential Furnishings - Total sales from Continuing
Operations decreased $427 million, or 20%, due to weak market
demand. EBIT from Continuing Operations decreased $60 million, with
the impact of lower unit volumes partially offset by cost
improvements, pricing discipline, and absence of last year's
restructuring-related costs. Commercial Fixturing & Components
- Total sales from Continuing Operations decreased $220 million, or
31% for the year due to weak markets and the company's decision in
Store Fixtures to walk away from sales with unacceptable profit
margins. EBIT from Continuing Operations decreased $7 million, with
the impact of reduced sales largely offset by cost reductions and
operational improvements. Industrial Materials - Total sales from
Continuing Operations decreased $319 million, or 33%, from both
deflation (related to steel prices) and reduced market demand. EBIT
decreased $35 million, with the impact of reduced sales partially
offset by improved cost structure. Specialized Products - Total
sales from Continuing Operations decreased $181 million, or 27%,
due to weak market demand. EBIT from Continuing Operations
decreased $27 million, with the impact of reduced sales partially
offset by cost reductions. Slides and Conference Call A set of
slides containing summary financial information is available from
the Investor Relations section of Leggett's website at
http://www.leggett.com/. Management will host a conference call at
8:00 a.m. Central (9:00 a.m. Eastern) on Friday, January 29. The
webcast can be accessed (live or replay) 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
Wednesday, April 21, with a conference call the next morning. FOR
MORE INFORMATION: Visit Leggett's website at
http://www.leggett.com/. COMPANY DESCRIPTION: Leggett & Platt
(NYSE:LEG) is a diversified manufacturer (and member of the S&P
500) that conceives, designs and produces a broad variety of
engineered components and products that can be found in most homes,
offices, and automobiles. The company serves a broad suite of
customers that comprise a "Who's Who" of U.S. manufacturers and
retailers. The 127-year-old firm is comprised of 19 business units,
19,000 employee-partners, and more than 140 manufacturing
facilities located in 18 countries. Leggett & Platt is North
America's leading independent manufacturer of: a) components for
residential furniture and bedding; b) components for office
furniture; c) drawn steel wire; d) automotive seat support and
lumbar systems; e) carpet underlay; f) adjustable beds; and g)
bedding industry machinery for wire forming, sewing and quilting.
FORWARD-LOOKING STATEMENTS: Statements in this release that are not
historical in nature are "forward-looking." These statements
involve uncertainties and risks, including the company's ability to
improve operations and realize cost savings, 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, future growth of
acquired companies, general economic conditions, foreign currency
fluctuation, litigation risks, and other factors described in the
company's Form 10-K. Any forward-looking statement reflects only
the company's beliefs when the statement is made. Actual results
could differ materially from expectations, and the company
undertakes no duty to update these statements. (1) TSR = (Change in
Stock Price + Dividends Received) / Beginning Stock Price; assumes
dividends are reinvested CONTACT: Investor Relations, (417)
358-8131 or David M. DeSonier, Vice President of Strategy and
Investor Relations Susan R. McCoy, Director of Investor Relations
LEGGETT & PLATT --------------- RESULTS OF OPERATIONS FOURTH
QUARTER YEAR TO DATE --------------------- --------------
------------ (In millions, except per share data) 2009 2008 Change
2009 2008 Change -------------------- ---- ---- ------ ---- ----
------ Net sales (from continuing operations) $769.7 $882.5 (13%)
3,055.1 $4,076.1 (25%) Cost of goods sold 599.5 771.9 2,425.4
3,384.9 ----- ----- ------- ------- Gross profit 170.2 110.6 629.7
691.2 Selling & administrative expenses 87.3 106.2 (18%) 363.0
423.2 (14%) Amortization 5.4 6.0 20.7 24.5 Other expense (income),
net 0.9 15.0 15.7 11.2 --- ---- ---- ---- Earnings before interest
and taxes 76.6 (16.6) 230.3 232.3 (1%) Net interest expense 7.9 8.1
31.9 39.7 --- --- ---- ---- Earnings before income taxes 68.7
(24.7) 198.4 192.6 Income taxes 26.2 (17.1) 77.3 65.1 ---- -----
---- ---- Net earnings from continuing operations 42.5 (7.6) 121.1
127.5 Discontinued operations, net of tax (1) (5.4) (9.8) (6.1)
(18.5) ---- ---- ---- ----- Net earnings 37.1 (17.4) 115.0 109.0
Net income from non- controlling interest 1.9 0.6 3.2 4.6 --- ---
--- --- Net earnings attributable to L&P $35.2 $(18.0) $111.8
$104.4 7% ===== ====== ====== ====== Earnings per diluted share
From continuing operations 0.26 (0.05) 0.74 0.73 1% From
discontinued operations (0.03) (0.06) (0.04) (0.11) Net earnings
per diluted share 0.23 (0.11) 0.70 0.62 Shares outstanding Common
stock (at end of period) 148.8 155.8 148.8 155.8 Basic (average for
period) 155.0 161.8 159.3 168.0 Diluted (average for period) 156.2
161.8 160.0 168.2 (5%) CASH FLOW FOURTH QUARTER YEAR TO DATE
--------- -------------- ------------ (In millions) 2009 2008
Change 2009 2008 Change ------------ ---- ---- ------ ---- ----
------ Net earnings $37.1 $(17.4) $115.0 $109.0 Depreciation and
amortization 33.0 34.8 130.3 140.4 Working capital decrease
(increase) 29.0 192.2 185.6 32.7 Asset Impairment 4.6 12.4 5.8 44.8
Other operating activity 31.2 11.1 128.6 109.3 ---- ---- -----
----- Net Cash from Operating Activity $134.9 $233.1 (42%) $565.3
$436.2 30% Additions to PP&E (17.6) (27.5) (36%) (83.0) (118.3)
(30%) Purchase of companies, net of cash 0.0 (1.0) (2.8) (10.3)
Proceeds from asset sales 5.0 21.6 14.1 407.6 Dividends paid (39.7)
(37.4) (157.2) (165.1) Repurchase of common stock, net (83.5)
(39.1) (188.0) (290.6) Additions (payments) to debt, net 37.6
(189.2) (64.2) (275.8) Other 2.3 (7.2) 11.6 (24.4) --- ---- ----
----- Increase (Decr.) in Cash & Equiv. $39.0 $(46.7) $95.8
$(40.7) ===== ====== ===== ====== EBITDA (2) $108.1 $17.5 518%
$361.6 $385.5 (6%) ====== ===== ====== ====== FINANCIAL POSITION
31-Dec ------------------ ------ (In millions) 2009 2008 Change
------------ ---- ---- ------ Cash and equivalents $260.5 $164.7
Receivables 469.5 550.5 Inventories 409.1 495.0 Held for sale 16.4
31.0 Other current assets 58.1 65.6 ---- ---- Total current assets
1,213.6 1,306.8 (7%) Net fixed assets 668.6 681.4 Held for sale
27.2 30.2 Goodwill and other assets 1,151.8 1,143.5 ------- -------
TOTAL ASSETS $3,061.2 $3,161.9 (3%) ======== ======== Trade
accounts payable $199.4 $175.3 Current debt maturities 10.1 22.4
Held for sale 3.2 7.4 Other current liabilities 322.4 319.1 -----
----- Total current liabilities 535.1 524.2 2% Long term debt 789.3
851.2 (7%) Deferred taxes and other liabilities 161.3 115.6
Shareholders' equity 1,575.5 1,670.9 (6%) ------- ------- Total
capitalization 2,526.1 2,637.7 ------- ------- TOTAL LIABILITIES
& EQUITY $3,061.2 $3,161.9 ======== ======== Net Debt to Net
Capital (3) 23.7% 28.4% Return on Equity (4) 6.9% 5.5% (1)
Discontinued operations include: Aluminum Products; Fibers, Wood
Products, Coated Fabrics (formerly in Residential Furnishings);
Storage Products, Plastics (formerly in Commercial Fixturing &
Components); and the dealer portion of Commercial Vehicle Products
(formerly in Specialized Products). (2) Earnings Before Interest,
Taxes, Depreciation, Amortization, and Impairments. Includes
discontinued operations. (3) Net Debt = Long Term Debt + Current
Debt Maturities - Cash & Equivalents. Net Capital = Total
Capitalization + Current Debt Maturities - Cash & Equivalents.
These adjustments enable meaningful comparison to historical
periods. (4) Return on Equity = Trailing Twelve Months Net Earnings
/ Shareholders' Equity averaged for start and end of the twelve
months. SEGMENT RESULTS FOURTH QUARTER YEAR TO DATE ---------------
-------------- ------------ (In millions) 2009 2008 Change 2009
2008 Change ---- ---- ------ ---- ---- ------ External Sales
-------------- Residential Furnishings $413.8 $456.3 (9.3%)
$1,684.8 $2,102.3 (19.9%) Commercial Fixturing & Components
100.0 135.3 (26.1%) 487.1 696.9 (30.1%) Industrial Materials 115.3
145.2 (20.6%) 437.6 658.2 (33.5%) Specialized Products 140.6 145.7
(3.5%) 445.6 618.7 (28.0%) ----- ----- ---- ----- ----- ----- Total
$769.7 $882.5 (12.8%) $3,055.1 $4,076.1 (25.0%) ====== ====== =====
======== ======== ===== Inter-Segment Sales -------------
Residential Furnishings $1.8 $3.2 $8.4 $17.5 Commercial Fixturing
& Components 1.2 0.5 4.3 14.4 Industrial Materials 41.9 67.9
209.2 308.0 Specialized Products 11.3 15.6 55.3 63.0 ---- ---- ----
---- Total $56.2 $87.2 $277.2 $402.9 ===== ===== ====== ======
Total Sales ----------- Residential Furnishings $415.6 $459.5
(9.6%) $1,693.2 $2,119.8 (20.1%) Commercial Fixturing &
Components 101.2 135.8 (25.5%) 491.4 711.3 (30.9%) Industrial
Materials 157.2 213.1 (26.2%) 646.8 966.2 (33.1%) Specialized
Products 151.9 161.3 (5.8%) 500.9 681.7 (26.5%) ----- ----- ----
----- ----- ----- Total $825.9 $969.7 (14.8%) $3,332.3 $4,479.0
(25.6%) ====== ====== ===== ======== ======== ===== EBIT ----
Residential Furnishings $34.2 $3.0 1040% $90.3 $150.7 (40%)
Commercial Fixturing & Components (1.8) (11.6) -nm- 7.6 14.4
(47%) Industrial Materials 11.7 19.8 (41%) 60.3 95.5 (37%)
Specialized Products 15.2 2.1 624% 17.3 44.7 (61%) Intersegment
eliminations and other 2.5 (2.8) (12.0) (11.1) Change in LIFO
reserve 14.8 (27.1) 66.8 (61.9) ---- ----- ---- ---- ----- ---
Total $76.6 (16.6) -nm- $230.3 $232.3 (1%) ===== ===== ==== ======
====== === EBIT Margin (1) Basis Pts Basis Pts -------------
--------- --------- Residential Furnishings 8.2% 0.7% 750 5.3% 7.1%
(180) Commercial Fixturing & Components (1.8%) (8.5%) 670 1.5%
2.0% (50) Industrial Materials 7.4% 9.3% (190) 9.3% 9.9% (60)
Specialized Products 10.0% 1.3% 870 3.5% 6.6% (310) ---- --- ---
--- --- ---- Overall from Continuing Operations 10.0% (1.9%) 1190
7.5% 5.7% 180 ==== ==== ==== === === === LAST SIX QUARTERS 2008
2009 ----------------- ---- ---- Selected Figures 3Q 4Q 1Q 2Q 3Q 4Q
(restated to exclude -- -- -- -- -- -- discontinued operations)
------------------------- Trade Sales ($ million) 1,132 883 718 757
810 770 Sales Growth (vs. prior year) 3.7% (15.1%) (28.1%) (28.8%)
(28.5%) (12.8%) EBIT ($ million) (3) 96 (17) 18 41 95 77 EBIT
Margin (3) 8.5% (1.9%) 2.5% 5.4% 11.7% 10.0% Net Earnings -
excludes discontinued oper. ($m) 48 (8) 4 19 55 41 Net Margin -
excludes discontinued operations 4.3% (0.9%) 0.5% 2.5% 6.8% 5.3%
EPS - continuing operations (diluted) $0.29 ($0.05) $0.02 $0.12
$0.34 $0.26 EBITDA ($ million) (2) 124 18 49 75 129 108 Cash from
Operations ($ million) (2) 77 233 115 174 142 135 Net Debt to Net
Capital (2) 28% 28% 27% 24% 24% 24% Same Location Sales (vs. prior
year) 3Q 4Q 1Q 2Q 3Q 4Q ------------------- -- -- -- -- -- --
Residential Furnishings 3% (12%) (19%) (23%) (23%) (9%) Commercial
Fixturing & Components (16%) (27%) (38%) (29%) (28%) (25%)
Industrial Materials 47% 13% (22%) (38%) (41%) (26%) Specialized
Products (1%) (20%) (38%) (33%) (27%) (6%) Overall from Continuing
Operations 4% (14%) (27%) (28%) (28%) (13%) (1) Segment margins
calculated on Total Sales. Overall company margin calculated on
External Sales. (2) These lines include amounts related to
discontinued operations. EBITDA excludes impairment charges. (3)
Prior quarters' amounts were restated for reclassification of net
income attributable to noncontrolling interest. nm = not meaningful
DATASOURCE: Leggett & Platt CONTACT: Investor Relations, David
M. DeSonier, Vice President of Strategy and Investor Relations, or
Susan R. McCoy, Director of Investor Relations, both of Leggett
& Platt, +1-417-358-8131, Web Site: http://www.leggett.com/
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