Leggett & Platt announces impact from customer shutdown

09 May '09

1 min read

Diversified manufacturer Leggett & Platt reported that Consolidated Bedding (the primary Spring Air manufacturer), a significant customer of Leggett's, notified Leggett on May 5 that it is ceasing operations. Although Leggett had previously established a significant bad debt reserve for this account, Leggett is increasing its bad debt expense by $8.5 million to reflect the full amount of the credit exposure it has with this customer.

As a result, today's 10Q SEC filing by Leggett will reflect first quarter earnings of $.02 per share rather than the $.06 announced in its press release of April 22. The $.04 per share earnings reduction is solely due to the shutdown of Consolidated Bedding's operations. Leggett is making no change to its full year guidance.

Consolidated Bedding's trade accounts with Leggett were current through May 1, 2009. In addition, the customer's owners had until recently indicated an enthusiasm for their restructuring plans and the business placements they were experiencing.

Leggett believes that the Consolidated Bedding volume of business will likely be dispersed among Leggett & Platt's other customers.

Leggett & Platt

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