Leggett & Platt 4Q Earnings Up 11%

Carthage, OH, February 1--Leggett & Platt posted an 11 percent increase in fourth-quarter earnings, driven by on asset sales, a lower tax rate, sales growth and full production at its steel mill. Quarterly income was $65.6 million, or 33 cents a share, up from $59 million, or 30 cents a share, last year. Earnings for the latest quarter include a gain of 5 cents a share on asset sales and a reduced tax rate, more than offset by a LIFO expense of nearly 7 cents. Fourth-quarter sales rose 12 percent to $1.28 billion from $1.14 billion, with acquisitions making a modest contribution. Same-location sales rose 11 percent, primarily due to inflation in steel costs. Overall unit volume was flat. Analysts surveyed by Thomson First Call expected Leggett to post earnings of 32 cents a share on sales of $1.26 billion in the fourth quarter. Gross margin was down in the fourth quarter, due to inflation-related sales growth and the failure of the LIFO expense to offset sequential increases in average product sales. For the year, Leggett earned $285.4 million, or $1.45 a share, on sales of $5.09 billion. In 2003, earnings were $205.9 million, or $1.05 a share, on sales of $4.39 billion. Analysts were looking for earnings of $1.44 a share on sales of $5.06 billion for the year. "Compared to one year ago, the fourth quarter benefited from sales growth, full production at our steel mill, a lower tax rate, and gains on asset sales," said Felix E. Wright, chairman and chief executive, in a statement. "Offsets included unit volume declines in some product lines (primarily innersprings and wire) and significant LIFO expenses. The impact of these two negative factors should diminish significantly in the first quarter of 2005." Leggett expects first-quarter earnings of 33 cents to 38 cents a share on sales roughly flat with the fourth quarter -- a gain of about 8 percent from the year-ago first quarter. For the year, Leggett expects earnings of $1.50 to $1.70 a share, on total sales growth of 6 percent to 10 percent from 2004. Analysts currently expect the company to earn 36 cents a share on sales of $1.28 billion for the first quarter and $1.63 a share on sales of $5.43 billion for the year.