Leggett & Platt shares lifted as earnings exceed lowered expectations (NYSE:LEG)

Leggett & Platt (NYSE:LEG) shares rose sharply in after hours buying and selling on Monday after posting higher than anticipated earnings outcomes for the third quarter.

The mattress producer notched $0.52 in earnings per share alongside $1.29B in income. Each of these figures got here in above the analyst consensus which mirrored expectations of $0.50 in EPS and $1.23B in income. Expectations had been minimize considerably for the corporate after it preannounced cuts to steering in mid-October.

“The U.S. bedding market stays pretty secure however at comparatively weak ranges, and we started to see slowing in different markets similar to European bedding, dwelling furnishings, work furnishings, and metal,” CEO Mitch Dolloff defined on Monday. “On account of these decrease demand ranges and the more and more difficult macroeconomic surroundings, we lowered our full 12 months steering on October tenth.”

Nonetheless, he mentioned Q3 outcomes got here in higher than administration expectations “attributable to incentive compensation changes.” The fourth quarter is anticipated to indicate sequential declines in gross sales and volumes “primarily attributable to additional reductions in metal rod manufacturing in response to the slowing metal market.”

Steerage for the full-year remained unchanged from the October 10 pre-announcement. Gross sales are anticipated to be $5.1B to $5.2B whereas quantity is anticipated to be down excessive single digits. Earnings per share are anticipated to fall in a variety of $2.30 to $2.45 for the complete 12 months given the fourth quarter forecast of $0.42 to $0.57

“We proceed to concentrate on issues we are able to management and are taking motion to mitigate the impression of those challenges by aligning prices, manufacturing ranges, and stock with demand; evaluating near-term alternatives with our clients and dealing with them on new product developments; and persevering with to construct out our current companies by way of acquisitions,” Dolloff concluded. “Our robust stability sheet and money circulate give us confidence in our capacity to navigate difficult markets whereas investing in long-term alternatives.”

Shares of Leggett & Platt (LEG) rose 3.7% in prolonged buying and selling on Monday.

Learn extra on the small print of the earnings outcomes.