Leggett & Platt, Incorporated · NYSE:LEG
Leggett & Platt — Q3 2024 Earnings Presentation
28 slides from Leggett & Platt's earnings presentation, Oct 29, 2024
Slide 1: Third Quarter 2024 Summary Financial Information and Restructuring Update
Third Quarter 2024 Summary Financial Information and Restructuring Update October 28, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements in this presentation that are not historical in nature are “forward-looking.” These statements are identified either by the context in which they appear or by use of words such as “anticipate,” “estimate,” “expect,” “guidance,” “may,” “plan,” or the like. These
Slide 3: Financial Summary
Financial Summary
Slide 4: Overview
Overview o Q3 sales of $1.1 billion, a 6% decrease vs Q3-23 • Volume was down 4% • Raw material-related price decreases, net of currency benefit, reduced sales 2% o Q3 adjusted1 EBIT of $76 million, down $10 million vs adjusted1 Q3-23 EBIT o Adjusted1 EBIT margin of 6.9%, down 40 bps vs Q3-23 adjust
Slide 5: Q3 2024 Financial Highlights
Q3 2024 Financial Highlights $’s in millions Reported Adj.1 Adj. Reported Adj.1 Adj. Change (except EPS) Q3-24 Q3-24 Q3-23 Q3-23 Sales $1,102 $1,102 $1,175 $1,175 (6%) EBIT 78 (2) 76 91 (5) 86 (12%) EBIT Margin 7.1% 6.9% 7.8% 7.3% (40 bps) EPS .33 (.01) .32 .39 (.03) .36 (11%) Cash from Operations 9
Slide 6: Q3 2024 Sales & EBIT Bridge
Q3 2024 Sales & EBIT Bridge Sales: mln $’s % change 3rd Qtr 2023 $1,175 Approx volume decrease (43) (4%) Approx raw material-related pricing and currency impact (30) (2%) Organic Sales (73) (6%) Acquisitions — —% 3rd Qtr 2024 $1,102 (6%) EBIT: margin Adjusted1 3rd Qtr 2023 $86 7.3% Primarily unfavor
Slide 7: Q3 2024 Earnings
Q3 2024 Earnings $’s in millions Reported Adj.1 Adj. Reported Adj.1 Adj. Change (except EPS) Q3-24 Q3-24 Q3-23 Q3-23 EBIT $78 ($2) $76 $91 ($5) $86 (12%) Net interest 20 20 21 21 Pre-tax earnings 58 (2) 56 71 (5) 65 (15%) Income taxes 13 (1) 12 18 (1) 17 Tax rate 22.1% 26.1% Net earnings 45 (1) 44 5
Slide 8: Adjusted Working Capital
Adjusted Working Capital $’s in millions 9/30 6/30 9/30 2024 2024 2023 Cash & equivalents $277 $307 $274 Accounts receivable, net 638 649 711 Inventories, net 754 755 835 Other current assets 65 78 66 Total current assets 1,735 1,789 1,886 Current debt maturities (301) (301) (9) Current operating le
Slide 9: Net Debt to Adjusted EBITDA
Net Debt to Adjusted EBITDA $’s in millions 9/30 6/30 9/30 2024 2024 2023 Long-term debt $1,578 $1,702 $1,963 Current maturities 301 301 9 Total debt 1,879 2,003 1,972 Less: Cash & equivalents (277) (307) (274) Net debt 1,602 1,696 1,698 EBIT, trailing 12 months (840) (827) 368 Depreciation & amorti
Slide 10: Cash Flow
Cash Flow $’s in millions 3rd Qtr YTD 2024 2023 2024 2023 Net earnings $45 $53 ($526) $161 D&A 36 45 102 135 Impairment, write-offs & other 5 (4) 712 (1) Other non-cash (24) (10) (76) 4 Changes in working capital: Accounts receivable 27 4 (14) (23) Inventory 5 17 41 67 Other current assets (2) 1 (5)
Slide 11: YTD 2024 Financial Highlights
YTD 2024 Financial Highlights $’s in millions Reported Adj.1 Adj. Reported Adj.1 Adj. Change (except EPS) 2024 2024 2023 2023 Sales $3,327 $3,327 $3,610 $3,610 (8%) EBIT (474) 684 211 276 (9) 267 (21%) EBIT Margin (14.2%) 6.3% 7.7% 7.4% (110 bps) EPS (3.83) 4.67 .84 1.18 (.05) 1.13 (26%) Cash from O
Slide 12: YTD 2024 Sales & EBIT Bridge
YTD 2024 Sales & EBIT Bridge Sales: mln $’s % change YTD 2023 $3,610 Approx volume decrease (164) (5%) Approx raw material-related pricing and currency impact (119) (3%) Organic Sales (283) (8%) Acquisitions — —% YTD 2024 $3,327 (8%) EBIT: margin Adjusted1 YTD 2023 $267 7.4% Primarily lower volume,
Slide 13: YTD 2024 Earnings
YTD 2024 Earnings $’s in millions Reported Adj.1 Adj. Reported Adj.1 Adj. Change (except EPS) 2024 2024 2023 2023 EBIT ($474) $684 $211 $276 ($9) $267 (21%) Net interest 61 61 64 64 Pre-tax earnings (534) 684 150 213 (9) 204 (26%) Income taxes (9) 43 35 52 (2) 50 Tax rate 23.2% 24.7% Net earnings (5
Slide 14: 2024 Guidance Lowered
2024 Guidance Lowered o Sales: $4.3–$4.4 billion; down 7% to 9% versus 2023 (vs prior guidance of $4.3–$4.5 billion) • Decrease due to weaker than previously anticipated demand, particularly within our Specialized Products and Furniture, Flooring & Textile Products segments • Volume is expected to b
Slide 15: 2024 Guidance (continued)
2024 Guidance (continued) o Depreciation and amortization ~$135 million o Net interest expense ~$80 million o Tax rate ~24% o Operating cash ~$300 million (vs prior guidance of $300–$350 million) o Cap-ex ~$100 million (vs prior guidance of $110 million) o Dividends ~$135 million o Diluted shares ~1
Slide 16: Restructuring Update
Restructuring Update
Slide 17: Restructuring Initiatives Progress
Restructuring Initiatives Progress Bedding Products Home Furniture Flooring Products Hydraulic Cylinders Mexico innerspring Restructuring activity Closed one production Manufacturing operation winding down complete line and transferred optimization and All other innerspring 1 property li
Slide 18: Restructuring Plan Is On Track
Restructuring Plan Is On Track o EBIT Benefit: • Annualized EBIT benefit of $50–$60 million realized after initiatives are fully implemented in late 2025 (versus prior estimate of $40– $50 million); updated to include additional benefit of ~$10 million to be realized in 2025 from G&A initiatives • A
Slide 19: Segment Detail
Segment Detail
Slide 20: Q3 2024 Segment Summary
Q3 2024 Segment Summary Q3-24 Q3-24 ∆ vs Q3-23 Q3-24 ∆ vs Q3-23 Organic Adj. EBIT 2 Adj. EBIT 2 Adj. EBITDA 2 Adj. EBITDA 2 Sales Margin Margin Margin Margin Growth 1, 2 Bedding Products (8%) 4.4% -90 bps 7.7% -300 bps Specialized Products (6%) 9.5% -30 bps 13.2% +10 bps Furniture, Flooring & (4%) 7
Slide 21: Bedding Products
Bedding Products Trade Sales mln $’s % change 3rd Qtr 2023 $483 Organic Sales 1 (38) (8%) 3rd Qtr 2024 $446 (8%) 1 Raw material-related selling price decreases and currency impact (5%) and lower volume (3%) mln $’s EBIT EBIT D&A EBITDA EBITDA margin margin Adjusted 2 3rd Qtr 2023 $26 5.3% $26 $52 10
Slide 22: Bedding – Key Points
Bedding – Key Points o Q3 organic sales were down 8%: • Volume decreased 3%, primarily due to the expected loss of a customer in Specialty Foam and demand softness in U.S. and European bedding markets, partially offset by higher trade rod and wire sales • Raw material-related selling price decreases
Slide 23: Specialized Products
Specialized Products Trade Sales mln $’s % change 3rd Qtr 2023 $319 Organic Sales 1 (19) (6%) 3rd Qtr 2024 $300 (6%) 1 Lower volume (7%) partially offset by currency benefit and raw material-related selling price increases 1% mln $’s EBIT EBIT D&A EBITDA EBITDA margin margin 3rd Qtr 2023 $31 9.8% $1
Slide 24: Specialized – Key Points
Specialized – Key Points o Q3 organic sales were down 6%: • Volume decreased 7% from declines in Automotive and Hydraulic Cylinders partially offset by growth in Aerospace • Currency benefit and raw material-related selling price increases added 1% to sales o Sales trends: Q3 Q3 Organic Sales Volume
Slide 25: Furniture, Flooring & Textile Products
Furniture, Flooring & Textile Products Trade Sales mln $’s % change 3rd Qtr 2023 $373 Organic Sales 1 (17) (4%) 3rd Qtr 2024 $356 (4%) 1 Lower volume (2%) and raw material-related price decreases, net of currency benefit (2%) mln $’s EBIT EBIT D&A EBITDA EBITDA margin margin 3rd Qtr 2023 $29 7.9% $6
Slide 26: Furniture, Flooring & Textile – Key Points
Furniture, Flooring & Textile – Key Points o Q3 organic sales were down 4%: • Volume decreased 2% primarily from declines in Home Furniture, Geo Components and Fabric Converting • Raw material-related selling price decreases and currency impact reduced sales 2% o Sales trends: Q3 Q3 Organic Sales Vo
Slide 27: Contact Us for Additional Information
CONTACT US FOR ADDITIONAL INFORMATION Ticker: LEG (NYSE) Website: www.leggett.com Email: invest@leggett.com Phone: (417) 358-8131 Cassie Branscum Kolina Talbert Vice President, Investor Relations Manager, Investor Relations Webcast replay and Company Fact Book are available at www.leggett.com
Slide 28: Non-GAAP Adjustments
Non-GAAP Adjustments $’s in millions Q3-24 Q3-23 YTD YTD (except EPS) 2024 2023 Non-GAAP Adjustments ($’s)1,2 Goodwill impairment 3 — — 675 — Restructuring, restructuring-related and impairment charges 4 12 — 34 — CEO transition compensation costs 5 — — 4 — Gain on sale of real estate 3 (14) (5) (27