Components supplier Leggett & Platt, which has headquarters in Carthage, Mo., announced sales of $896 million in the first quarter of 2011, a 10% increase over the first quarter of 2010. Earnings per share were $0.30 for the quarter.
The company’s total sales from continuing operations in the residential furnishings division, which includes domestic bedding products, were $457.5 million, an increase of $25 million, or 6%, over the first quarter of 2010. Inflation accounted for the bulk of the sales increase, the company said.
Total sales from continuing operations in the specialized products division, which includes the Global Systems Group machinery division, were $165 million, an increase of $38 million, or 28%, over the prior–year quarter.
“We are very encouraged to see higher market demand and sales growth during the first quarter,” said David Haffner, L&P chief executive officer. “That growth enhanced earnings, but was offset by higher raw materials costs, as previously anticipated. We implemented price increases during the quarter in response to cost inflation. As a result, we expect improved margins in subsequent quarters.”
During the first quarter, L&P repurchased 5.4 million shares of its stock at an average price of $23.29 per share and issued 1.8 million shares through employee benefit and stock purchase plans. As a result, outstanding shares decreased to 142.6 million.
“During the first quarter, we were more aggressive with our stock repurchases,” Haffner said. “We believe the economy is gradually recovering and our end–markets appear more stable. Accordingly, we are more willing to repurchase shares and to let leverage gradually move toward our target range. We ended the quarter with net debt to net capital below our long–term target range and over $450 million available under our existing commercial paper program and revolver facility.”
L&P is moving into the third step of a three–part strategic plan.
The final step envisions growth of 4% to 5% per year, on average,” Haffner said. “For the next couple of years, we expect market recovery to provide growth in excess of our target. Earnings should improve meaningfully as a result of our operating leverage and spare production capacity. Longer term, we expect growth to come from commercialization of innovative new products, expansion into potential new growth areas and normal GDP–like growth in our existing markets.”
L&P expects sales of $3.5 billion to $3.8 billion in 2011.