Q1 2025 Leggett & Platt Inc Earnings Call Transcript
Key Points
- Leggett & Platt Inc (LEG) reported better-than-anticipated first quarter earnings, attributed to successful restructuring and operational efficiency improvements.
- The company made significant progress on its restructuring plan, including divesting a small U.S. machinery business and launching Phase 2 of consolidation efforts in flooring products.
- Leggett & Platt Inc (LEG) signed an agreement to sell its aerospace business, expecting after-tax cash proceeds of approximately $240 million, contributing to a more focused portfolio.
- The company is well-positioned to benefit from steel tariffs, which are leading to expanded metal margins and higher demand for its steel rod and drawn wire operations.
- Leggett & Platt Inc (LEG) maintained its sales and adjusted earnings guidance for 2025, with expectations of increased U.S. rod and wire pricing due to steel-related tariff benefits.
- First quarter sales were down 7% compared to the first quarter of 2020, due to weak demand in residential end markets and soft demand in automotive and hydraulic cylinders.
- Sales in the Bedding Products segment decreased by 13%, with continued demand softness in mattresses and adjustable bases.
- The company faces challenges from tariffs, which could drive inflation, hurt consumer confidence, and pressure consumer demand.
- Leggett & Platt Inc (LEG) experienced a decline in bedding volume, attributed to restructuring-related sales attrition and increased competition from imported finished mattresses.
- The company's net debt to trailing 12-month adjusted EBITDA increased slightly to 3.77 times at the end of the first quarter, reflecting the normal seasonality of working capital investments.
Greetings, and welcome to the Leggett & Platt First Quarter 2025 Webcast and Earnings Conference Call. (Operator Instructions)
As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Cassie Branscum, VP of Investor Relations. Thank you. Ms. Branscum. You may begin.
Good morning, and welcome to Leggett & Platt's First Quarter 2025 Earnings Call. With me on the call today are Karl Glassman, CEO; Ben Burns, CFO; and Tyson Hegel, President of the Bedding Products segment; and Sam Smith, President of the Specialized Products and Furniture, Flooring and Textile Products segment.
The agenda for our call this morning is as follows: Carl will provide an update on our strategic priorities and outline our current exposure to and plans to address tariffs. Ben will cover our first quarter operating results, demand trends, additional financial details and provide an update to our 2025 guidance and the group will answer any
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