Leggett Reports First Quarter Earnings of $0.23 Per Share

Apr 18, 2001, 01:00 ET from Leggett & Platt, Inc.

    CARTHAGE, Mo., April 18 /PRNewswire/ -- Leggett & Platt reported first
 quarter earnings of $.23 per diluted share, down 38% from last year's first
 quarter record earnings of $.37 per diluted share, and in line with guidance
 announced on January 31.  Sales were a first quarter record at $1.05 billion,
 an increase of 0.9% versus first quarter 2000.  Sales growth from numerous
 acquisitions was more than offset by a 7.4% decline in same location sales, as
 weak market demand continued to impact all five business segments.  Production
 cutbacks contributed to reduced plant utilization and lower overhead
 absorption, which significantly impacted profit margins and earnings for the
 quarter.
     Commenting on these results, Mr. Felix E. Wright, President and CEO said,
 "First quarter results are disappointing in light of our long track record of
 consistent growth.  During this period of economic downturn we are focusing on
 the four-point tactical plan we announced last September, thereby positioning
 the company for strong future performance.  Over the last six months we have
 closed or sold 9 facilities, and have consolidated most of this production
 into other Leggett operations.  In many areas we are running short production
 weeks, and staggering shifts, which allows us to trim back production yet
 retain the majority of our skilled workforce.  Though we could trim labor
 costs more dramatically, we are looking beyond the current downturn, and want
 to be well situated to ramp up production when the economy improves.
 Consistent with our reduced pace while under the tactical plan, we added about
 $60 million to annual revenues from five acquisitions that are "bolt on"
 additions to existing Leggett businesses.  Finally, during the first quarter
 we repurchased 1.4 million shares of stock, at an average price of about
 $20.25, to replace shares issued in employee plans.
     "We remain cautious regarding the economic outlook for the balance of
 2001.  For the past six months our same location sales have been down about
 6-8% on average versus the same month of the prior year.  We expect this trend
 to continue for the second quarter, as we have yet to see signs of change.
 Sales are not deteriorating further, but are also not showing improvement.
 Accordingly, we have modified our business outlook.  We now believe that
 economic weakness will persist through the third quarter, and we do not
 anticipate year on year growth in same location sales until the fourth
 quarter.  Solely as a result of this change in macro assumption, we are
 reducing our guidance.  We believe full year earnings will be between
 $1.10-$1.25 per diluted share, with declines in both same location sales and
 margins versus 2000.  In the second quarter we expect earnings between $.23
 and $.30 per diluted share.
     "We continue to believe that Leggett is extremely well situated to
 capitalize on an improving economy, whenever it develops.  Today's additional
 rate cut by the Fed, especially if accompanied by tax relief and stable energy
 prices, will hopefully help spur consumer spending.  In any event, our cash
 flow remains strong -- $86 million of cash from operations was generated
 during the quarter.   Our balance sheet is solid -- long-term debt (net of
 cash) is 35% of total capitalization.  And our long-term goals remain
 unchanged -- we continue to target sales and earnings growth of 15% on
 average, return on equity in the high teens, and a debt level around
 30%-40% of total capitalization."
     Management will discuss these results via teleconference at 8:00 a.m.
 Central (9 a.m. Eastern) on Thursday, April 19.  The discussion can be
 accessed (live or replay) from the investor relations section of Leggett's
 website at www.leggett.com , or at www.streetfusion.com .  Second quarter
 results will be released on July 18, with a conference call on July 19.
 
     SEGMENT RESULTS - First Quarter 2001
     Residential Furnishings --  Total sales decreased 2.4%.  Same location
     sales decreased 4.2%, and were partially offset by acquisitions.  EBIT
     (earnings before interest and income taxes) declined 27%.  Soft industry
     demand and efforts to reduce inventories resulted in lower production.
     Lower plant utilization rates, reduced overhead absorption, and higher raw
     material costs in fiber and foam operations, yielded lower margins.
 
     Commercial Furnishings -- Total sales increased 17.6% due to numerous
     acquisitions.  Same location sales declined 0.2%, as a small increase
     sales of store fixtures, displays, and storage products was offset by
     reduced sales of components for office and contract furniture.  EBIT
     decreased 37%, reflecting reduced margins attributable to changing product
     mix, and softness in the telecom and van fixtures businesses.
 
     Aluminum Products -- Total sales decreased 17.7%.  Same location sales
     were down 19.8%, and were slightly offset by one acquisition.  Reduced
     cast component sales reflect weak market demand for a variety of consumer
     and industrial products, as well as the absence of automotive business
     purged over the last year.  EBIT decreased 43% due to reduced volumes,
     decreased efficiencies, and higher natural gas costs.
 
     Industrial Materials -- Total sales decreased 6.5%.  Same location sales
     were down 10.6%, and were partially offset by acquisitions.  EBIT declined
     36%, mainly as a result of reduced sales and lower utilization;
     non-recurring costs, including the closure of a wire mill, accounted for
     about two-fifths of the decline in EBIT.
 
     Specialized Products -- Total sales increased 32.7% due to acquisitions.
     Same location sales declined 7.9%, due primarily to slowing production and
     inventory adjustments in automotive markets.  EBIT was down 16% due to
     reduced sales and changing product mix.
 
     Leggett & Platt is a Fortune 500 diversified manufacturer of a broad
 variety of engineered products.  With efforts focused in five business
 segments, Leggett is North America's leading independent manufacturer of all
 the following: a) components for residential furniture and bedding; b) retail
 store fixtures and point of purchase displays; c) components for office
 furniture; d) non-automotive aluminum die castings; e) drawn steel wire;
 f) automotive seat support and lumbar systems; and g) bedding industry
 machinery for wire forming, sewing and quilting.  The company has facilities
 throughout North America and in numerous international locations.  Leggett's
 common stock (symbol LEG) is listed on the New York Stock Exchange, and is a
 component of the S&P 500 Index.
     This news release includes "forward-looking" statements that involve
 uncertainties and risks.  Actual results could differ materially from the
 company's expectations, and the company undertakes no obligation to update or
 revise these forward-looking statements.  Factors that could cause such
 differences include the company's ability to improve operations and realize
 cost savings, competitive and general economic conditions, future growth of
 acquired companies, and other risks described in the company's Annual Report
 or Form 10-K.
 
     CONTACT: David M. DeSonier, VP of Investor Relations for Leggett & Platt,
 Inc, 417-358-8131, invest@leggett.com , or visit Leggett's website at
 www.leggett.com .
 
 
     LEGGETT & PLATT
     RESULTS OF OPERATIONS                            FIRST QUARTER
          (in millions, except per
           share data)                            2001         2000      Change
     Net sales                                $1,053.3     $1,043.6       0.9%
     Cost of goods sold                          802.2        772.1
        Gross profit                             251.1        271.5
     Selling, distrib. & admin. expenses         149.7        134.0
     Other deductions, net of income              11.8          7.1
        Earnings before interest and taxes        89.6        130.4       (31%)
     Interest expense                             17.2         14.6
     Interest income                               0.5          1.5
        Earnings before income taxes              72.9        117.3
     Income taxes                                 26.9         43.5
        Net earnings                             $46.0        $73.8       (38%)
     Earnings per share
        Basic                                    $0.23        $0.37
        Diluted                                  $0.23        $0.37       (38%)
     Average shares outstanding
        Basic                                    199.2        198.8
        Diluted                                  200.4        200.3
 
 
     CASH FLOW                                        FIRST QUARTER
                           (in millions)          2001         2000      Change
     Net Earnings                                $46.0        $73.8
     Depreciation and amortization                45.8         38.9
     Working capital decrease (increase)          (3.6)       (36.3)
     Other operating activity                     (1.9)        (2.4)
        Net Cash from Operating Activity         $86.3        $74.0        17%
     Additions to PP&E                           (33.2)       (41.4)      (20%)
     Purchase of companies, net of cash          (36.1)       (70.8)      (49%)
     Additions to debt, net                       18.6        190.7
     Dividends paid                              (44.9)       (37.2)
     Repurchase of common stock, net             (14.8)       (18.2)
     Other                                        (1.0)        (6.3)
        Increase in Cash & Equivalents          $(25.1)       $90.8
 
 
     FINANCIAL POSITION                                  31-Mar
                           (in millions)          2001         2000      Change
     Cash and equivalents                        $12.2       $111.4
     Receivables                                 683.1        655.9         4%
     Inventories                                 654.4        636.5         3%
     Other current assets                         67.9         68.0
        Total current assets                   1,417.6      1,471.8
     Trade accounts payable                      180.2        170.7         6%
     Current debt maturities                       8.6          4.4
     Other current liabilities                   287.9        309.4        (7%)
        Total current liabilities                476.7        484.5
     Working capital                             940.9        987.3        (5%)
     Net fixed assets                          1,027.1        934.2        10%
     Other assets **                             992.7        868.0        14%
        TOTAL NET ASSETS                      $2,960.7     $2,789.5
     Long term debt **                        $1,038.3       $993.6         4%
     Deferred taxes and other liabilities        112.5        106.5
     Shareholders' equity*                     1,809.9      1,689.4         7%
        TOTAL CAPITALIZATION                  $2,960.7     $2,789.5
     LT Debt to Total Cap (net of cash)          34.8%        32.9%
 
     *In accordance with Financial Accounting Standard No. 130, comprehensive
 earnings would have been $44.9 and $71.5 for the three months ending March 31,
 2001 and 2000, respectively.
     ** Due to implementation of Financial Accounting Standard No. 133, "Other
 Assets" and "Long Term Debt" increased $29 million.
 
     SEGMENT RESULTS                                  FIRST QUARTER
                           (in millions)          2001       2000**      Change
     External Sales
     Residential Furnishings                    $518.4       $532.3      (2.6%)
     Commercial Furnishings                      244.7        207.8      17.8%
     Aluminum Products                           129.9        159.0     (18.3%)
     Industrial Materials                         71.8         78.8      (8.9%)
     Specialized Products                         88.5         65.7      34.7%
          Total                               $1,053.3     $1,043.6       0.9%
 
     Inter-Segment Sales
     Residential Furnishings                      $3.2         $2.2
     Commercial Furnishings                        0.8          1.0
     Aluminum Products                             4.1          3.9
     Industrial Materials                         54.8         56.6
     Specialized Products                         15.4         12.6
          Total                                  $78.3        $76.3
 
     Total Sales
     Residential Furnishings                    $521.6       $534.5      (2.4%)
     Commercial Furnishings                      245.5        208.8      17.6%
     Aluminum Products                           134.0        162.9     (17.7%)
     Industrial Materials                        126.6        135.4      (6.5%)
     Specialized Products                        103.9         78.3      32.7%
          Total                               $1,131.6     $1,119.9       1.0%
 
     EBIT
     Residential Furnishings                     $45.3        $62.0       (27%)
     Commercial Furnishings                       14.7         23.2       (37%)
     Aluminum Products                             9.4         16.6       (43%)
     Industrial Materials                         13.1         20.6       (36%)
     Specialized Products                         10.2         12.1       (16%)
     Intersegment eliminations                    (3.5)        (2.7)       30%
     Change in LIFO reserve                        0.4         (1.4)     (129%)
          Total                                  $89.6       $130.4       (31%)
 
     EBIT Margin *                                                   Basis Pts
     Residential Furnishings                      8.7%        11.6%       (290)
     Commercial Furnishings                       6.0%        11.1%       (510)
     Aluminum Products                            7.0%        10.2%       (320)
     Industrial Materials                        10.3%        15.2%       (490)
     Specialized Products                         9.8%        15.5%       (570)
          Total                                   8.5%        12.5%       (400)
 
     * Segment margins calculated on Total Sales.   Overall company margin
     calculated on External Sales.
     ** Segment figures for 2000 include the reclass of one operation from
     Commercial to Industrial.
 
 

SOURCE Leggett & Platt, Inc.
    CARTHAGE, Mo., April 18 /PRNewswire/ -- Leggett & Platt reported first
 quarter earnings of $.23 per diluted share, down 38% from last year's first
 quarter record earnings of $.37 per diluted share, and in line with guidance
 announced on January 31.  Sales were a first quarter record at $1.05 billion,
 an increase of 0.9% versus first quarter 2000.  Sales growth from numerous
 acquisitions was more than offset by a 7.4% decline in same location sales, as
 weak market demand continued to impact all five business segments.  Production
 cutbacks contributed to reduced plant utilization and lower overhead
 absorption, which significantly impacted profit margins and earnings for the
 quarter.
     Commenting on these results, Mr. Felix E. Wright, President and CEO said,
 "First quarter results are disappointing in light of our long track record of
 consistent growth.  During this period of economic downturn we are focusing on
 the four-point tactical plan we announced last September, thereby positioning
 the company for strong future performance.  Over the last six months we have
 closed or sold 9 facilities, and have consolidated most of this production
 into other Leggett operations.  In many areas we are running short production
 weeks, and staggering shifts, which allows us to trim back production yet
 retain the majority of our skilled workforce.  Though we could trim labor
 costs more dramatically, we are looking beyond the current downturn, and want
 to be well situated to ramp up production when the economy improves.
 Consistent with our reduced pace while under the tactical plan, we added about
 $60 million to annual revenues from five acquisitions that are "bolt on"
 additions to existing Leggett businesses.  Finally, during the first quarter
 we repurchased 1.4 million shares of stock, at an average price of about
 $20.25, to replace shares issued in employee plans.
     "We remain cautious regarding the economic outlook for the balance of
 2001.  For the past six months our same location sales have been down about
 6-8% on average versus the same month of the prior year.  We expect this trend
 to continue for the second quarter, as we have yet to see signs of change.
 Sales are not deteriorating further, but are also not showing improvement.
 Accordingly, we have modified our business outlook.  We now believe that
 economic weakness will persist through the third quarter, and we do not
 anticipate year on year growth in same location sales until the fourth
 quarter.  Solely as a result of this change in macro assumption, we are
 reducing our guidance.  We believe full year earnings will be between
 $1.10-$1.25 per diluted share, with declines in both same location sales and
 margins versus 2000.  In the second quarter we expect earnings between $.23
 and $.30 per diluted share.
     "We continue to believe that Leggett is extremely well situated to
 capitalize on an improving economy, whenever it develops.  Today's additional
 rate cut by the Fed, especially if accompanied by tax relief and stable energy
 prices, will hopefully help spur consumer spending.  In any event, our cash
 flow remains strong -- $86 million of cash from operations was generated
 during the quarter.   Our balance sheet is solid -- long-term debt (net of
 cash) is 35% of total capitalization.  And our long-term goals remain
 unchanged -- we continue to target sales and earnings growth of 15% on
 average, return on equity in the high teens, and a debt level around
 30%-40% of total capitalization."
     Management will discuss these results via teleconference at 8:00 a.m.
 Central (9 a.m. Eastern) on Thursday, April 19.  The discussion can be
 accessed (live or replay) from the investor relations section of Leggett's
 website at www.leggett.com , or at www.streetfusion.com .  Second quarter
 results will be released on July 18, with a conference call on July 19.
 
     SEGMENT RESULTS - First Quarter 2001
     Residential Furnishings --  Total sales decreased 2.4%.  Same location
     sales decreased 4.2%, and were partially offset by acquisitions.  EBIT
     (earnings before interest and income taxes) declined 27%.  Soft industry
     demand and efforts to reduce inventories resulted in lower production.
     Lower plant utilization rates, reduced overhead absorption, and higher raw
     material costs in fiber and foam operations, yielded lower margins.
 
     Commercial Furnishings -- Total sales increased 17.6% due to numerous
     acquisitions.  Same location sales declined 0.2%, as a small increase
     sales of store fixtures, displays, and storage products was offset by
     reduced sales of components for office and contract furniture.  EBIT
     decreased 37%, reflecting reduced margins attributable to changing product
     mix, and softness in the telecom and van fixtures businesses.
 
     Aluminum Products -- Total sales decreased 17.7%.  Same location sales
     were down 19.8%, and were slightly offset by one acquisition.  Reduced
     cast component sales reflect weak market demand for a variety of consumer
     and industrial products, as well as the absence of automotive business
     purged over the last year.  EBIT decreased 43% due to reduced volumes,
     decreased efficiencies, and higher natural gas costs.
 
     Industrial Materials -- Total sales decreased 6.5%.  Same location sales
     were down 10.6%, and were partially offset by acquisitions.  EBIT declined
     36%, mainly as a result of reduced sales and lower utilization;
     non-recurring costs, including the closure of a wire mill, accounted for
     about two-fifths of the decline in EBIT.
 
     Specialized Products -- Total sales increased 32.7% due to acquisitions.
     Same location sales declined 7.9%, due primarily to slowing production and
     inventory adjustments in automotive markets.  EBIT was down 16% due to
     reduced sales and changing product mix.
 
     Leggett & Platt is a Fortune 500 diversified manufacturer of a broad
 variety of engineered products.  With efforts focused in five business
 segments, Leggett is North America's leading independent manufacturer of all
 the following: a) components for residential furniture and bedding; b) retail
 store fixtures and point of purchase displays; c) components for office
 furniture; d) non-automotive aluminum die castings; e) drawn steel wire;
 f) automotive seat support and lumbar systems; and g) bedding industry
 machinery for wire forming, sewing and quilting.  The company has facilities
 throughout North America and in numerous international locations.  Leggett's
 common stock (symbol LEG) is listed on the New York Stock Exchange, and is a
 component of the S&P 500 Index.
     This news release includes "forward-looking" statements that involve
 uncertainties and risks.  Actual results could differ materially from the
 company's expectations, and the company undertakes no obligation to update or
 revise these forward-looking statements.  Factors that could cause such
 differences include the company's ability to improve operations and realize
 cost savings, competitive and general economic conditions, future growth of
 acquired companies, and other risks described in the company's Annual Report
 or Form 10-K.
 
     CONTACT: David M. DeSonier, VP of Investor Relations for Leggett & Platt,
 Inc, 417-358-8131, invest@leggett.com , or visit Leggett's website at
 www.leggett.com .
 
 
     LEGGETT & PLATT
     RESULTS OF OPERATIONS                            FIRST QUARTER
          (in millions, except per
           share data)                            2001         2000      Change
     Net sales                                $1,053.3     $1,043.6       0.9%
     Cost of goods sold                          802.2        772.1
        Gross profit                             251.1        271.5
     Selling, distrib. & admin. expenses         149.7        134.0
     Other deductions, net of income              11.8          7.1
        Earnings before interest and taxes        89.6        130.4       (31%)
     Interest expense                             17.2         14.6
     Interest income                               0.5          1.5
        Earnings before income taxes              72.9        117.3
     Income taxes                                 26.9         43.5
        Net earnings                             $46.0        $73.8       (38%)
     Earnings per share
        Basic                                    $0.23        $0.37
        Diluted                                  $0.23        $0.37       (38%)
     Average shares outstanding
        Basic                                    199.2        198.8
        Diluted                                  200.4        200.3
 
 
     CASH FLOW                                        FIRST QUARTER
                           (in millions)          2001         2000      Change
     Net Earnings                                $46.0        $73.8
     Depreciation and amortization                45.8         38.9
     Working capital decrease (increase)          (3.6)       (36.3)
     Other operating activity                     (1.9)        (2.4)
        Net Cash from Operating Activity         $86.3        $74.0        17%
     Additions to PP&E                           (33.2)       (41.4)      (20%)
     Purchase of companies, net of cash          (36.1)       (70.8)      (49%)
     Additions to debt, net                       18.6        190.7
     Dividends paid                              (44.9)       (37.2)
     Repurchase of common stock, net             (14.8)       (18.2)
     Other                                        (1.0)        (6.3)
        Increase in Cash & Equivalents          $(25.1)       $90.8
 
 
     FINANCIAL POSITION                                  31-Mar
                           (in millions)          2001         2000      Change
     Cash and equivalents                        $12.2       $111.4
     Receivables                                 683.1        655.9         4%
     Inventories                                 654.4        636.5         3%
     Other current assets                         67.9         68.0
        Total current assets                   1,417.6      1,471.8
     Trade accounts payable                      180.2        170.7         6%
     Current debt maturities                       8.6          4.4
     Other current liabilities                   287.9        309.4        (7%)
        Total current liabilities                476.7        484.5
     Working capital                             940.9        987.3        (5%)
     Net fixed assets                          1,027.1        934.2        10%
     Other assets **                             992.7        868.0        14%
        TOTAL NET ASSETS                      $2,960.7     $2,789.5
     Long term debt **                        $1,038.3       $993.6         4%
     Deferred taxes and other liabilities        112.5        106.5
     Shareholders' equity*                     1,809.9      1,689.4         7%
        TOTAL CAPITALIZATION                  $2,960.7     $2,789.5
     LT Debt to Total Cap (net of cash)          34.8%        32.9%
 
     *In accordance with Financial Accounting Standard No. 130, comprehensive
 earnings would have been $44.9 and $71.5 for the three months ending March 31,
 2001 and 2000, respectively.
     ** Due to implementation of Financial Accounting Standard No. 133, "Other
 Assets" and "Long Term Debt" increased $29 million.
 
     SEGMENT RESULTS                                  FIRST QUARTER
                           (in millions)          2001       2000**      Change
     External Sales
     Residential Furnishings                    $518.4       $532.3      (2.6%)
     Commercial Furnishings                      244.7        207.8      17.8%
     Aluminum Products                           129.9        159.0     (18.3%)
     Industrial Materials                         71.8         78.8      (8.9%)
     Specialized Products                         88.5         65.7      34.7%
          Total                               $1,053.3     $1,043.6       0.9%
 
     Inter-Segment Sales
     Residential Furnishings                      $3.2         $2.2
     Commercial Furnishings                        0.8          1.0
     Aluminum Products                             4.1          3.9
     Industrial Materials                         54.8         56.6
     Specialized Products                         15.4         12.6
          Total                                  $78.3        $76.3
 
     Total Sales
     Residential Furnishings                    $521.6       $534.5      (2.4%)
     Commercial Furnishings                      245.5        208.8      17.6%
     Aluminum Products                           134.0        162.9     (17.7%)
     Industrial Materials                        126.6        135.4      (6.5%)
     Specialized Products                        103.9         78.3      32.7%
          Total                               $1,131.6     $1,119.9       1.0%
 
     EBIT
     Residential Furnishings                     $45.3        $62.0       (27%)
     Commercial Furnishings                       14.7         23.2       (37%)
     Aluminum Products                             9.4         16.6       (43%)
     Industrial Materials                         13.1         20.6       (36%)
     Specialized Products                         10.2         12.1       (16%)
     Intersegment eliminations                    (3.5)        (2.7)       30%
     Change in LIFO reserve                        0.4         (1.4)     (129%)
          Total                                  $89.6       $130.4       (31%)
 
     EBIT Margin *                                                   Basis Pts
     Residential Furnishings                      8.7%        11.6%       (290)
     Commercial Furnishings                       6.0%        11.1%       (510)
     Aluminum Products                            7.0%        10.2%       (320)
     Industrial Materials                        10.3%        15.2%       (490)
     Specialized Products                         9.8%        15.5%       (570)
          Total                                   8.5%        12.5%       (400)
 
     * Segment margins calculated on Total Sales.   Overall company margin
     calculated on External Sales.
     ** Segment figures for 2000 include the reclass of one operation from
     Commercial to Industrial.
 
 SOURCE  Leggett & Platt, Inc.