Leggett & Platt, Incorporated (LEG) Bundle
A Brief History of Leggett & Platt, Incorporated
Leggett & Platt, Incorporated (NYSE: LEG) is a diversified manufacturer of engineered components and products. As of 2024, the company has faced significant financial challenges, largely due to macroeconomic pressures and declines in demand across various segments.
Financial Performance Overview
For the nine months ended September 30, 2024, Leggett & Platt reported net trade sales of $3.33 billion, a decrease from $3.61 billion in the same period of 2023. The cost of goods sold was $2.75 billion, resulting in a gross profit of $573.5 million, down from $654 million in the prior year.
| Financial Metrics | 2024 (9 Months) | 2023 (9 Months) |
|---|---|---|
| Net Trade Sales | $3,327.2 million | $3,610.2 million |
| Cost of Goods Sold | $2,753.7 million | $2,956.2 million |
| Gross Profit | $573.5 million | $654.0 million |
| Net Earnings (Loss) | ($525.6 million) | $160.6 million |
| Earnings Per Share (Basic) | ($3.83) | $1.18 |
Stock Performance
The company's stock has seen a significant decline in value throughout 2024. The closing stock price was $26.17 on December 29, 2023, dropping to $19.15 on March 28, 2024, and further declining to $11.46 by June 28, 2024.
Segment Performance
Leggett & Platt's operations are divided into multiple segments, including Bedding Products, Specialized Products, and Furniture, Flooring & Textile Products. Each segment has faced challenges due to decreased demand and increased competition.
- Bedding Products: Trade sales decreased by 12%, primarily due to lower demand in the U.S. and European markets.
- Specialized Products: Sales decreased by 3%, with declines in the Automotive and Hydraulic Cylinders sectors.
- Furniture, Flooring & Textile Products: Experienced a 6% decrease in sales attributed to lower volume and pricing pressures.
Impairments and Restructuring
In 2024, Leggett & Platt recognized a non-cash goodwill impairment charge of $675 million, mainly affecting the Bedding Products segment. The company is currently undergoing a restructuring plan to address operational inefficiencies and reduce costs, which is expected to be completed by the end of 2025.
Liquidity and Capitalization
As of September 30, 2024, the company reported total debt of $1.8 billion, with total equity at $741.8 million. The company holds cash and cash equivalents of $277 million, down from $365 million at the end of 2023.
| Capitalization Metrics | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Debt | $1,795.3 million | $1,801.6 million |
| Total Equity | $741.8 million | $1,334.0 million |
| Cash and Cash Equivalents | $277.2 million | $365.5 million |
Dividends and Shareholder Returns
In August 2024, Leggett & Platt declared a quarterly dividend of $0.05 per share, a significant reduction from $0.46 in the same quarter of 2023. This decision reflects the company's strategy to conserve cash for debt reduction and operational improvements.
Future Outlook
Looking ahead, Leggett & Platt aims to stabilize its operations and restore profitability through strategic restructuring, cost management, and focusing on core competencies. The company remains committed to enhancing shareholder value while navigating the current economic landscape.
A Who Owns Leggett & Platt, Incorporated (LEG)
Ownership Structure
As of 2024, Leggett & Platt, Incorporated (LEG) has a diverse ownership structure consisting of institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Number of Shares (in millions) | Ownership Percentage |
|---|---|---|
| Institutional Investors | 77.5 | 56.5% |
| Mutual Funds | 36.8 | 26.9% |
| Individual Investors | 22.4 | 16.6% |
| Insider Ownership | 2.7 | 2.0% |
Major Institutional Shareholders
The following table lists the top institutional shareholders of Leggett & Platt as of 2024:
| Institution | Shares Owned (in millions) | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 11.5 | 8.4% |
| BlackRock, Inc. | 10.7 | 7.8% |
| State Street Corporation | 6.8 | 4.9% |
| Wellington Management Group LLP | 5.2 | 3.8% |
| Invesco Ltd. | 4.1 | 3.0% |
Recent Stock Performance
Leggett & Platt's stock has experienced volatility over the past year. The closing stock prices for key dates are as follows:
| Date | Closing Price (USD) |
|---|---|
| December 31, 2023 | 26.17 |
| March 28, 2024 | 19.15 |
| June 28, 2024 | 11.46 |
Financial Overview
For the nine months ended September 30, 2024, Leggett & Platt reported the following financial results:
| Metric | Amount (in millions) |
|---|---|
| Net Trade Sales | 3,327.2 |
| Cost of Goods Sold | 2,753.7 |
| Gross Profit | 573.5 |
| Net Earnings (Loss) | (525.6) |
| Earnings Per Share (EPS) | (3.83) |
Dividends
In August 2024, the Board of Directors declared a third quarter 2024 dividend of $0.05, which is a decrease from the previous year’s third quarter dividend of $0.46.
Conclusion on Ownership Dynamics
Leggett & Platt's ownership dynamics reflect a significant presence of institutional investors, concentrated shareholding, and a recent trend of declining stock price impacting overall market perception. The financial results indicate challenges faced by the company, particularly in net earnings and stock performance, which may influence shareholder sentiment going forward.
Leggett & Platt, Incorporated (LEG) Mission Statement
Company Overview
Leggett & Platt, Incorporated is a diversified manufacturer, producing a wide range of engineered components and products used in homes, offices, and automobiles. The company operates approximately 120 production facilities across 18 countries and is a leading supplier in various segments including bedding products, automotive seating systems, and furniture components.
Mission Statement
The mission of Leggett & Platt is to provide innovative and high-quality products that enhance the comfort and functionality of everyday life. The company aims to be a trusted partner to its customers, delivering value through superior products and services.
Financial Performance
As of September 30, 2024, Leggett & Platt reported the following financial metrics:
| Financial Metric | 2024 | 2023 | Change |
|---|---|---|---|
| Net Trade Sales (in millions) | $3,327.2 | $3,610.2 | $(283.0) (-7.8%) |
| Net Earnings (Loss) (in millions) | $(525.6) | $160.6 | $(686.2) |
| Earnings Per Share (EPS) | $(3.83) | $1.18 | $(5.01) |
| Operating Cash Flow (in millions) | $183 | $351 | $(168) |
| Debt Paid Down (in millions) | $124 | N/A | N/A |
Market Segments
Leggett & Platt operates across several key segments, each contributing to its overall revenue:
| Segment | Trade Sales (in millions) | Percentage of Total Sales |
|---|---|---|
| Bedding Products | $1,331.5 | 40% |
| Specialized Products | $933.8 | 28% |
| Furniture, Flooring & Textile Products | $1,060.3 | 32% |
Restructuring Plan
In 2024, Leggett & Platt initiated a restructuring plan aimed at consolidating production facilities and improving operational efficiency. The plan includes:
- Consolidation of 15 to 20 production facilities.
- Expected restructuring costs of $65 to $85 million.
- Annualized EBIT benefit of $50 to $60 million post-implementation.
- Proceeds from real estate sales estimated between $60 to $80 million.
Cash and Liquidity Position
As of September 30, 2024, Leggett & Platt had the following liquidity metrics:
| Liquidity Metric | Amount (in millions) |
|---|---|
| Cash and Cash Equivalents | $277 |
| Current Assets | $1,734.5 |
| Current Liabilities | $1,171.7 |
| Working Capital | $562.8 |
Conclusion on Mission Execution
Leggett & Platt continues to focus on its mission of delivering value and innovation, despite facing challenges in the market. The company’s ongoing restructuring efforts and strategic initiatives are designed to enhance its operational efficiency and financial performance, aligning with its mission to be a trusted partner in the industries it serves.
How Leggett & Platt, Incorporated (LEG) Works
Business Operations
Leggett & Platt, Incorporated (LEG) operates as a diversified manufacturer, producing engineered components and products for various industries including bedding, automotive, and furniture. The company has approximately 120 production facilities in 18 countries worldwide.
Segments of Operation
LEG's operations are divided into three main reportable segments:
- Bedding Products: This segment produces components and machinery for bedding manufacturers and private label finished goods. It accounted for 40% of trade sales in the first nine months of 2024.
- Specialized Products: This segment supplies automotive seat systems and aerospace tubing. It contributed 28% of trade sales in the same period.
- Furniture, Flooring & Textile Products: This segment includes various components for home and office furniture and flooring underlayment.
Financial Performance
For the nine months ended September 30, 2024, Leggett & Platt reported:
| Metric | 2024 | 2023 | Change |
|---|---|---|---|
| Net Trade Sales | $3,327 million | $3,610 million | (7.8)% |
| EBIT | ($473.6) million | $276.4 million | (271.3)% |
| Net Earnings (Loss) | ($525.6) million | $160.6 million | (426.2)% |
| EPS | ($3.83) | $1.18 | (424.6)% |
Segment Performance
Trade sales by segment for the nine months ended September 30, 2024, were as follows:
| Segment | Trade Sales (2024) | Trade Sales (2023) | Change |
|---|---|---|---|
| Bedding Products | $1,331.5 million | $1,516.2 million | (12.2)% |
| Specialized Products | $935.4 million | $961.3 million | (2.7)% |
| Furniture, Flooring & Textile Products | $1,060.3 million | $1,132.7 million | (6.4)% |
Cash Flow and Liquidity
As of September 30, 2024, LEG reported:
- Operating Cash Flow: $183 million, a decrease of $168 million compared to 2023.
- Cash and Cash Equivalents: $277 million.
- Debt Repayment: $124 million paid down in the third quarter of 2024.
Restructuring Plan
LEG has initiated a restructuring plan with expected costs between $65 million and $85 million, with approximately $40 million to $50 million anticipated in 2024. The plan aims to realize annualized EBIT benefits of $50 million to $60 million post-implementation.
Market and Economic Factors
The company faces challenges from macroeconomic pressures, including low demand in residential markets, which have impacted its financial performance. The fair value of its reporting units has decreased, leading to a significant goodwill impairment charge of $675 million in 2024.
Stock Performance
LEG's stock performance has been volatile, with closing prices as follows:
| Date | Closing Price |
|---|---|
| December 29, 2023 | $26.17 |
| March 28, 2024 | $19.15 |
| June 28, 2024 | $11.46 |
How Leggett & Platt, Incorporated (LEG) Makes Money
Revenue Segments
Leggett & Platt operates through three primary segments: Bedding Products, Specialized Products, and Furniture, Flooring & Textile Products. Each segment contributes differently to the overall revenue.
| Segment | Trade Sales (9M 2024, in millions) | Trade Sales (9M 2023, in millions) | Change in Sales (in millions) | % Change in Organic Sales |
|---|---|---|---|---|
| Bedding Products | $1,331.5 | $1,516.2 | $(184.7) | (12.2)% |
| Specialized Products | $935.4 | $961.3 | $(25.9) | (2.7)% |
| Furniture, Flooring & Textile Products | $1,060.3 | $1,132.7 | $(72.4) | (6.4)% |
| Total | $3,327.2 | $3,610.2 | $(283.0) | (7.8)% |
Bedding Products Segment
The Bedding Products segment is a significant revenue generator, contributing approximately 40% of total trade sales. In the first nine months of 2024, this segment recorded trade sales of $1,331.5 million, down from $1,516.2 million in the same period of 2023. The decline is attributed to:
- Weak demand in U.S. and European markets.
- Loss of a customer in the Specialty Foam sector.
- Raw material-related selling price decreases impacting sales by 6%.
Specialized Products Segment
This segment accounts for about 28% of total trade sales. Trade sales for the nine months ended September 30, 2024, were $935.4 million, a decrease from $961.3 million in 2023. Contributing factors include:
- Volume declines in Automotive and Hydraulic Cylinders.
- Offsetting growth in Aerospace.
Furniture, Flooring & Textile Products Segment
This segment also saw a decrease in sales, totaling $1,060.3 million in the first nine months of 2024 compared to $1,132.7 million in 2023. The reasons for this decline include:
- Lower demand in Home Furniture and Geo Components.
- Raw material-related price decreases impacting sales.
Financial Performance Indicators
Leggett & Platt's earnings before interest and taxes (EBIT) for the nine months ending September 30, 2024, was $(473.6) million, a significant decline compared to $276.4 million in the same period of 2023. Key points include:
- Non-cash goodwill impairment charge of $675 million.
- Restructuring costs contributing to overall losses.
- Operating cash flow was $183 million, down from $351 million in the previous year.
| Financial Metrics | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Earnings (Loss) | $(525.6) million | $160.6 million |
| EBIT | $(473.6) million | $276.4 million |
| Operating Cash Flow | $183 million | $351 million |
| EPS | $(3.83) | $1.18 |
Cost Structure and Impairments
Cost of goods sold (COGS) for the first nine months of 2024 was $2,753.7 million, down from $2,956.2 million in 2023. The gross profit was reported at $573.5 million, compared to $654 million in the previous year. The decline in gross profit margins is primarily due to:
- Increased restructuring-related costs.
- Lower sales volumes across all segments.
- Impairments affecting overall profitability.
Market Trends and Economic Factors
Leggett & Platt's financial performance is influenced by various macroeconomic factors, including:
- Housing market trends affecting consumer demand for bedding and furniture.
- Inflationary pressures impacting raw material costs.
- Changes in consumer spending patterns driven by economic uncertainty.
Liquidity and Capital Resources
As of September 30, 2024, Leggett & Platt had cash and cash equivalents totaling $277 million. The company continues to focus on improving its balance sheet and managing debt levels.
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Resources:
- Leggett & Platt, Incorporated (LEG) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Leggett & Platt, Incorporated (LEG)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Leggett & Platt, Incorporated (LEG)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.