Leggett & Platt reports Q2 EPS of $0.48

25 Jul '14

2 min read

Diversified manufacturer Leggett & Platt reported second quarter adjusted EPS of $0.48 from continuing operations, compared to $0.44 in the prior year. The $0.04 EPS increase reflects sales growth, a lower tax rate, and reduced share count.

Second quarter EPS, with no adjustment, declined to a loss of $.17 in 2014, from $.48 in 2013. Second quarter 2014 EPS includes a previously announced non-cash goodwill impairment charge of $.65 (or $108 million pre-tax). Second quarter EPS in 2013 includes $.05 from discontinued operations, primarily driven by a tax benefit from the elimination of three small operations.

Second quarter 2014 sales were $1,002 million, a 4% (or $43 million) increase versus the prior year. Same location sales improved 3% due to strong volume gains in most of the company's residential markets (including bedding, home furniture, geo components, adjustable beds, fabric converting, and carpet underlay), and also in the office furniture and automotive markets.

These gains were partially offset by large sales declines in Store Fixtures and Commercial Vehicle Products. Acquisitions contributed modestly to sales growth.

EBIT, excluding the impairment, improved slightly versus last year, with the income from broad based sales growth largely offset by weak store fixture demand and non-recurrence of last year's $4 million gain from asset sales.

Dividends and Stock Repurchases

In May, Leggett & Platt's Board of Directors declared a $.30 second quarter dividend, one cent higher than last year's second quarter dividend. Thus, 2014 marks the 43rd consecutive annual dividend increase for the company, with a compound annual growth rate of 13%. Only one other S&P 500 company can claim as high a rate of dividend growth for as many years. Leggett & Platt is proud of its dividend record, and plans to continue it.

At yesterday's closing share price of $32.93, the indicated annual dividend of $1.20 per share generates a dividend yield of 3.6%, the fourth-highest dividend yield among the 54 stocks of the S&P 500 Dividend Aristocrats.

During the second quarter the company purchased 2.3 million shares of its stock at an average price of $33.33. For the first half of the year, the company purchased 3.9 million shares, and issued 1.7 million shares. Shares outstanding decreased by 2.2 million, to 137.2 million.

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