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CNA
5 days ago
- Business
- CNA
Analysis:Just in time? Manufacturers turn to AI to weather tariff storm
LONDON :Manufacturers like U.S. lawnmower maker The Toro Company are not panicking at the prospect of U.S. President Donald Trump's global trade tariffs. Despite five years of dramatic supply disruptions, from the COVID pandemic to today's trade wars, Toro is resisting any temptation to stack its warehouses to the rafters. "We are at probably pre-pandemic inventory levels," says its chief supply-chain manager, Kevin Carpenter, looking relaxed in front of a whiteboard at his office in Minneapolis. "I mean 2019. I think everybody will be at a 2019 level." Among U.S. manufacturers, inventories have roller-coasted this year as they rushed to beat Trump's deadlines for tariff hikes, only to see them repeatedly delayed. But since their post-pandemic expansion, inventories have mostly contracted, according to U.S. Institute for Supply Management data. Instead, "just in time" inventory management - which aims to increase efficiency and reduce waste by ordering goods only as they are needed - is back. But how can firms run lean inventories even as tariffs fluctuate, export bans come out of the blue, and conflict rages? One of the answers, they say, is artificial intelligence. Carpenter says he uses AI to digest the daily stream of news that could impact Toro's business, from Trump's latest social media posts to steel prices, into a custom-made podcast that he listens to each morning. His team also uses generative AI to sieve an ocean of data and to suggest when and how many components to buy from whom. It is a boom industry. Spending on software that includes generative AI for supply chains, capable of learning and even performing tasks on its own, could hit $55 billion by 2029, up from $2.7 billion now, according to U.S. research firm Gartner, driven in part by global uncertainties. HYPE "The tool just puts up in front of you: 'I think you can take 100 tonnes of this product from this plant to transfer it to that plant. And you just hit accept if that makes sense (to you)," McKinsey supply chain consultant Matt Jochim said. The biggest providers of overall supply chain software by revenue are Germany's SAP, U.S. firms Oracle, Coupa and Microsoft and Blue Yonder, a unit of Panasonic, according to Gartner. Generative AI is in its infancy, with most firms still piloting it spending modest amounts, industry experts say. Those investments can climb to tens of millions of dollars when deployed at scale, including the use of tools known as AI agents, which make their own decisions and often need costly upgrades to data management and other IT systems, they said. In commenting for this article, SAP, Oracle, Coupa, Microsoft and Blue Yonder described strong growth for generative AI solutions for supply chains without giving numbers. At U.S. supply chain consultancy GEP, which sells AI tools like this, Trump's tariffs are helping to drive demand. "The tariff volatility has been big," says GEP consultant Mukund Acharya, an expert in retail industry supply chains. SAP said the uncertainty was driving technology take-up. "That's how it was during the financial crisis, Brexit and COVID. And it's what we're seeing now," Richard Howells, SAP vice president and supply chain specialist, said in a statement. An AI agent can sift real-time news feeds on changing tariff scenarios, assess contract renewal dates and a myriad of other data points and come up with a suggested plan of action. But supply chain experts warn of AI hype, saying a lot of money will be wasted on a vain hope that AI can work miracles. "AI is really a powerful enabler for supply chain resilience, but it's not a silver bullet," says Minna Aila, communications chief at Finnish crane-maker Konecranes and member of a business board that advises the OECD on issues including supply chain resilience. "I'm still looking forward to the day when AI can predict terrorist attacks that are at sea, for instance." Konecranes' logistics partners are deploying AI on more mundane data, like weather forecasts. The company makes port cranes that are up to 106 metres (348 ft) high when assembled. When shipping them, AI marries weather forecasts with data like bridge heights to optimise the route. "To ship those across oceans, you do have to take into consideration weather," Aila says. RISING COSTS By keeping inventories low, firms can bolster profit margins that are under pressure from rising costs. Every component or finished product sitting on a shelf is capital tied up, incurring finance and storage costs and at risk of obsolescence. McKinsey has been surveying supply-chain executives since the pandemic. Its most recent survey showed that respondents relying on bigger inventory to cushion disruptions fell to 34 per cent last year from 60 per cent in 2022. Early responses from its upcoming 2025 survey suggest a similar picture, Jochim said. Gartner supply chain analyst Noha Tohamy says that without AI, companies would be slower to react and be more likely to be drawn into building up inventories. "When supply chain organisations don't have that visibility and don't really understand the uncertainty, we go for inventory buffering," Tohamy says. But AI agents won't put supply chain managers out of work, not yet, consultants say. Humans still need to make strategic and big tactical decisions, leaving AI agents to do more routine tasks like ordering and scheduling production maintenance. Toro supply chain chief Carpenter says that without AI, supply chain managers might need to run bigger teams as well.
Yahoo
05-06-2025
- Business
- Yahoo
The Toro Company Reports Results for the Second Quarter of Fiscal 2025
Highlighted by Professional Segment Growth and Profitability Improvement Second-quarter net sales of $1.32 billion, down slightly from the same period of fiscal 2024 Second-quarter reported diluted EPS of $1.37, compared to $1.38 in the same period of fiscal 2024 Second-quarter *adjusted diluted EPS of $1.42, up from $1.40 in the same period of fiscal 2024 Company updates full year fiscal 2025 guidance BLOOMINGTON, Minn., June 05, 2025--(BUSINESS WIRE)--The Toro Company (NYSE: TTC), a leading global provider of solutions for the outdoor environment, today reported results for its fiscal second quarter ended May 2, 2025. "Our second-quarter results demonstrate the resilience and agility of The Toro Company and commitment of our dedicated employees and channel partners to deliver innovative solutions and exceptional service to meet our customers' needs," said Richard M. Olson, chairman and chief executive officer. "While top-line growth was pressured in our Residential segment, we drove continued Professional segment momentum, which helped us exceed our expectations for earnings in the quarter. Our progress exemplifies the success of our strategic and operational actions to create long-term value for all stakeholders." OUTLOOK "We are taking decisive steps to strategically position the company to navigate near-term headwinds. Our strong portfolio and disciplined execution continue to sustain our performance, and we remain confident in our ability to manage controllable factors while mitigating macroeconomic risks," concluded Olson. For fiscal 2025, management now expects total company net sales to be in the range of flat to down 3% and *adjusted diluted EPS in the range of $4.15 to $4.30. This guidance is based on current visibility, inclusive of anticipated tariff impacts, and reflects: a reduction in volume from macro factors that have driven increased homeowner and channel caution, continued strong demand and stable supply for our underground construction and golf and grounds businesses, and weather patterns aligned with historical averages for the remainder of the year. SECOND-QUARTER FISCAL 2025 FINANCIAL HIGHLIGHTS Reported Adjusted* (dollars in millions, except per share data) F25 Q2 F24 Q2 % Change F25 Q2 F24 Q2 % Change Net Sales $ 1,317.9 $ 1,349.0 (2 )% $ 1,317.9 $ 1,349.0 (2 )% Net Earnings $ 136.8 $ 144.8 (6 )% $ 141.8 $ 147.3 (4 )% Diluted EPS $ 1.37 $ 1.38 (1 )% $ 1.42 $ 1.40 1 % SECOND-QUARTER FISCAL 2025 SEGMENT RESULTS Professional Segment Professional segment net sales for the second quarter were $1,014.1 million, up 0.8% from $1,005.6 million in the same period last year. The increase was primarily driven by higher shipments of golf and grounds products, partially offset by lower shipments of underground and specialty construction products and the prior year construction equipment dealer divestitures. Professional segment earnings for the second quarter were $202.1 million, up from $190.7 million in the same period last year, and when expressed as a percentage of net sales, 19.9%, up from 19.0% in the prior-year period. The increase in profitability was primarily due to product mix and productivity improvements, partially offset by higher material and manufacturing costs. Residential Segment Residential segment net sales for the second quarter were $297.4 million, down 11.4% from $335.6 million in the same period last year. The decrease was primarily driven by lower shipments of walk power mowers, zero-turn mowers, and portable power products, as well as the prior year Pope Products divestiture, partially offset by higher shipments of snow products and lower sales promotions and incentives. Residential segment earnings for the second quarter were $16.1 million, down from $36.1 million in the same period last year, and when expressed as a percentage of net sales, 5.4%, down from 10.8% in the prior-year period. The decrease was largely driven by higher material, manufacturing, and freight costs, lower net sales volume, and inventory valuation adjustments, partially offset by productivity improvements and lower sales promotions and incentives. OPERATING RESULTS Gross margin and *adjusted gross margin for the second quarter were 33.1% and 33.4%, respectively, down from 33.6% for both in the same prior-year period. The change in gross margin was primarily due to higher material and manufacturing costs and inventory valuation adjustments, partially offset by product mix and productivity improvements. SG&A expense as a percentage of net sales for the second quarter was 19.8%, compared with 19.7% in the prior-year period, primarily driven by lower net sales volume. Operating earnings as a percentage of net sales were 13.3% for the second quarter, compared with 13.9% in the same prior-year period. *Adjusted operating earnings as a percentage of net sales for the second quarter were 13.7%, compared with 14.2% in the same prior-year period. Interest expense was $15.8 million for the second quarter, down $0.9 million from the same prior-year period. This decrease was primarily due to lower average interest rates. The reported effective tax rate for the second quarter was 18.9%, compared with 19.2% in the same prior-year period, primarily due to a more favorable geographic mix of earnings, partially offset by lower tax benefits recorded as excess tax deductions for stock-based compensation. The *adjusted effective tax rate for the second quarter was 18.7% compared with 19.8% in the same prior-year period, primarily due to a more favorable geographic mix of earnings. *Non-GAAP financial measure. Please refer to the "Use of Non-GAAP Financial Information" for details regarding these measures, as well as the tables provided for a reconciliation of historical non-GAAP financial measures to the most comparable GAAP measures. LIVE CONFERENCE CALLJune 5, 2025 at 10:00a.m. The Toro Company will conduct its earnings call and webcast for investors beginning at 10:00a.m. CT on June 5, 2025. The webcast will be available at Webcast participants will need to complete a brief registration form and should allocate extra time before the webcast begins to register and, if necessary, install audio software. About The Toro Company The Toro Company (NYSE: TTC) is a leading worldwide provider of innovative solutions for the outdoor environment including turf and landscape maintenance, snow and ice management, underground utility construction, rental and specialty construction, and irrigation and outdoor lighting solutions. With net sales of $4.6 billion in fiscal 2024, The Toro Company's global presence extends to more than 125 countries through a portfolio of brands that includes Toro, Ditch Witch, Exmark, Spartan, BOSS, Ventrac, American Augers, Trencor, Subsite, HammerHead, Radius, Perrot, Hayter, Unique Lighting Systems, Irritrol, and Lawn-Boy. Through constant innovation and caring relationships built on trust and integrity, The Toro Company and its brands have built a legacy of excellence by helping customers work on golf courses, sports fields, construction sites, public green spaces, commercial and residential properties and agricultural operations. For more information, visit Use of Non-GAAP Financial Information This press release and the related earnings call reference certain non-GAAP financial measures, which are not calculated or presented in accordance with U.S. GAAP, as information supplemental and in addition to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP. The non-GAAP financial measures included within this press release and the related earnings call that are utilized as measures of the company's operating performance consist of gross profit, gross margin, operating earnings, earnings before income taxes, net earnings, diluted EPS, and the effective tax rate, each as adjusted. The non-GAAP financial measures included within this press release and the related earnings call that are utilized as measures of the company's liquidity consist of free cash flow and free cash flow conversion percentage. The Toro Company uses these non-GAAP financial measures in making operating decisions and assessing liquidity because it believes these non-GAAP financial measures provide meaningful supplemental information regarding core operational performance and cash flows, as a measure of the company's liquidity, and provide the company with a better understanding of how to allocate resources to both ongoing and prospective business initiatives. Additionally, these non-GAAP financial measures facilitate the company's internal comparisons for both historical operating results and competitors' operating results by factoring out potential differences caused by charges and benefits not related to its regular, ongoing business, including, without limitation, certain non-cash, large, and/or unpredictable charges and benefits; acquisitions and dispositions; legal judgments, settlements, or other matters; and tax positions. The company believes that these non-GAAP financial measures, when considered in conjunction with the financial measures prepared in accordance with U.S. GAAP, provide investors with useful supplemental financial information to better understand its core operational performance and cash flows. Reconciliations of historical non-GAAP financial measures to the most comparable U.S. GAAP financial measures are included in the financial tables contained in this press release. These non-GAAP financial measures, however, should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the U.S. GAAP financial measures included within this press release and the company's related earnings call. These non-GAAP financial measures may differ from similar measures used by other companies. The Toro Company does not provide a quantitative reconciliation of the company's projected range for adjusted diluted EPS for fiscal 2025 to diluted EPS, which is the most directly comparable GAAP measure, in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. The company's adjusted diluted EPS guidance for fiscal 2025 excludes certain items that are inherently uncertain and difficult to predict, including certain non-cash, large and/or unpredictable charges and benefits; acquisitions and dispositions; legal judgments, settlements, or other matters; and tax positions. Due to the uncertainty of the amount or timing of these future excluded items, management does not forecast them for internal use and therefore cannot create a quantitative adjusted diluted EPS for fiscal 2025 to diluted EPS reconciliation without unreasonable efforts. A quantitative reconciliation of adjusted diluted EPS for fiscal 2025 to diluted EPS would imply a degree of precision and certainty as to these future items that does not exist and could be confusing to investors. From a qualitative perspective, it is anticipated that the differences between adjusted diluted EPS for fiscal 2025 to diluted EPS will consist of items similar to those described in the financial tables later in this release, including, for example and without limitation, certain non-cash, large, and/or unpredictable charges and benefits; acquisitions and dispositions; legal judgments, settlements, or other matters; and tax positions. The timing and amount of any of these excluded items could significantly impact the company's diluted EPS for a particular period. Forward-Looking Statements This news release contains forward-looking statements, which are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current assumptions and expectations of future events, and often can be identified by words such as "anticipate," "believe," "become," "can," "continue," "could," "encourage," "estimate," "expect," "forecast," "goal," "guidance," "improve," "intend," "likely," "looking ahead," "may," "optimistic," "outlook," "plan," "possible," "potential," "pro forma," "project," "promise," "pursue," "should," "strive," "target," "will," "would," "seek," variations of such words or the negative thereof, and similar expressions or future dates. Forward-looking statements involve risks and uncertainties that could cause actual events and results to differ materially from those projected or implied. Forward-looking statements in this release include the company's fiscal 2025 financial guidance, expectations regarding anticipated tariff impacts, reduction in volume from macro factors that have driven increased homeowner and channel caution, and continued strong demand and stable supply for underground construction and golf and grounds businesses, and other statements made under the "Outlook" section of this release. Particular risks and uncertainties that may affect the company's operating results or financial position or cause actual events and results to differ materially from those projected or implied include: adverse worldwide economic conditions, including inflationary pressures and higher interest rates; the effect of weather; customer, government and municipal revenue, budget spending levels and cash conservation efforts, including whether the company is taking the right strategic and operational actions to create long-term value for all stakeholders; loss of any substantial customer; inventory adjustments or changes in purchasing patterns by customers; fluctuations in the cost and availability of commodities, components, parts, and accessories, including steel, engines, hydraulics, and resins; the company's ability to manufacture products to meet demand; disruption at or in proximity to its facilities or in its manufacturing or other operations, or those in its distribution channel customers, mass retailers or home centers where its products are sold, or suppliers; risks associated with acquisitions and dispositions, including a potential future impairment charge associated with the indefinite-lived Spartan trade name intangible assets acquired in the company's Intimidator acquisition; impacts of the company's AMP initiative and any future restructuring activities or productivity or cost savings initiatives; geopolitical factors and government policies and actions with respect to global trade, tariffs, U.S. trade policy and trade agreements; the effect of natural disasters, social unrest, war and global pandemics; the level of growth or contraction in its key markets; the company's ability to develop and achieve market acceptance for new products; increased competition; the risks attendant to international relations, operations and markets; foreign currency exchange rate fluctuations; financial viability of and/or relationships with the company's distribution channel partners; management of strategic partnerships, key customer relationships, alliances or joint ventures, including Red Iron Acceptance, LLC; impact of laws, regulations and standards, consumer product safety, accounting, taxation, trade, tariffs and/or antidumping and countervailing duties petitions, healthcare, and environmental, health and safety matters; unforeseen product quality problems; loss of or changes in executive management or key employees; the occurrence of litigation or claims, including those involving intellectual property or product liability matters; impact of increased scrutiny on its sustainability practices; and other risks and uncertainties described in the company's most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q and other filings with the Securities and Exchange Commission. The company makes no commitment to revise or update any forward-looking statements in order to reflect events or circumstances occurring or existing after the date any forward-looking statement is made. (Financial tables follow) THE TORO COMPANY AND SUBSIDIARIES Condensed Consolidated Statements of Earnings (Unaudited) (Dollars and shares in millions, except per-share data) Three Months Ended Six Months Ended May 2, 2025 May 3, 2024 May 2, 2025 May 3, 2024 Net sales $ 1,317.9 $ 1,349.0 $ 2,312.9 $ 2,350.9 Cost of sales 881.2 896.0 1,540.6 1,553.4 Gross profit 436.7 453.0 772.3 797.5 Gross margin 33.1 % 33.6 % 33.4 % 33.9 % Selling, general and administrative expense 261.9 265.4 519.7 521.3 Operating earnings 174.8 187.6 252.6 276.2 Interest expense (15.8 ) (16.7 ) (30.8 ) (32.9 ) Other income, net 9.7 8.3 13.0 16.0 Earnings before income taxes 168.7 179.2 234.8 259.3 Income tax provision 31.9 34.4 45.2 49.6 Net earnings $ 136.8 $ 144.8 $ 189.6 $ 209.7 Basic net earnings per share of common stock $ 1.37 $ 1.39 $ 1.88 $ 2.01 Diluted net earnings per share of common stock $ 1.37 $ 1.38 $ 1.88 $ 2.00 Weighted-average number of shares of common stock outstanding — Basic 99.8 104.4 100.6 104.4 Weighted-average number of shares of common stock outstanding — Diluted 100.1 104.9 100.9 104.9 Segment Data (Unaudited) (Dollars in millions) Three Months Ended Six Months Ended Segment net sales May 2, 2025 May 3, 2024 May 2, 2025 May 3, 2024 Professional $ 1,014.1 $ 1,005.6 $ 1,782.9 $ 1,762.1 Residential 297.4 335.6 518.4 575.7 Other 6.4 7.8 11.6 13.1 Total net sales* $ 1,317.9 $ 1,349.0 $ 2,312.9 $ 2,350.9 *Includes international net sales of: $ 255.6 $ 268.2 $ 467.0 $ 473.2 Three Months Ended Six Months Ended Segment earnings (loss) before income taxes May 2, 2025 May 3, 2024 May 2, 2025 May 3, 2024 Professional $ 202.1 $ 190.7 $ 329.3 $ 303.5 Residential 16.1 36.1 33.3 59.6 Other (49.5 ) (47.6 ) (127.8 ) (103.8 ) Total segment earnings before income taxes $ 168.7 $ 179.2 $ 234.8 $ 259.3 THE TORO COMPANY AND SUBSIDIARIES Condensed Consolidated Balance Sheets (Unaudited) (Dollars in millions) May 2, 2025 May 3, 2024 October 31, 2024 ASSETS Cash and cash equivalents $ 176.5 $ 188.8 $ 199.5 Receivables, net 602.5 623.1 459.7 Inventories, net 1,119.8 1,105.0 1,038.9 Prepaid expenses and other current assets 80.1 102.3 66.8 Total current assets 1,978.9 2,019.2 1,764.9 Property, plant, and equipment, net 635.8 637.8 644.8 Goodwill 450.8 450.7 450.3 Other intangible assets, net 487.3 522.7 498.7 Right-of-use assets 110.9 117.3 114.5 Investment in finance affiliate 51.2 51.7 49.2 Deferred income taxes 58.6 31.0 45.0 Other assets 14.6 21.8 15.4 Total assets $ 3,788.1 $ 3,852.2 $ 3,582.8 LIABILITIES AND STOCKHOLDERS' EQUITY Current portion of long-term debt $ 20.0 $ 13.5 $ 10.0 Accounts payable 516.0 512.4 452.7 Accrued liabilities 536.7 503.2 493.0 Short-term lease liabilities 18.5 19.6 20.3 Total current liabilities 1,091.2 1,048.7 976.0 Long-term debt, less current portion 1,077.1 1,003.3 911.8 Long-term lease liabilities 96.2 103.2 99.1 Deferred income taxes 0.6 0.4 0.5 Other long-term liabilities 46.4 45.2 43.5 Stockholders' equity: Preferred stock — — — Common stock 99.0 104.0 101.5 Retained earnings 1,419.6 1,583.2 1,496.4 Accumulated other comprehensive loss (42.0 ) (35.8 ) (46.0 ) Total stockholders' equity 1,476.6 1,651.4 1,551.9 Total liabilities and stockholders' equity $ 3,788.1 $ 3,852.2 $ 3,582.8 THE TORO COMPANY AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (Unaudited) (Dollars in millions) Six Months Ended May 2, 2025 May 3, 2024 Cash flows from operating activities: Net earnings $ 189.6 $ 209.7 Adjustments to reconcile net earnings to net cash provided by operating activities: Non-cash income from finance affiliate (9.8 ) (10.4 ) Distributions from finance affiliate, net 7.8 9.3 Depreciation of property, plant, and equipment 48.0 43.4 Amortization of other intangible assets 15.6 17.5 Stock-based compensation expense 9.8 15.3 Other 0.9 0.6 Changes in operating assets and liabilities, net of the effect of acquisitions: Receivables, net (141.6 ) (214.6 ) Inventories, net (78.7 ) (15.6 ) Other assets 51.3 (1.0 ) Accounts payable 59.5 81.0 Other liabilities (29.3 ) (0.1 ) Net cash provided by operating activities 123.1 135.1 Cash flows from investing activities: Purchases of property, plant, and equipment (38.4 ) (39.5 ) Acquisition, net of cash acquired (4.2 ) — Proceeds from asset disposals 0.2 0.1 Proceeds from divestitures — 1.9 Net cash used in investing activities (42.4 ) (37.5 ) Cash flows from financing activities: Borrowings under debt arrangements1 740.0 285.0 Repayments under debt arrangements1 (565.0 ) (300.0 ) Proceeds from exercise of stock options 1.3 1.9 Payments of withholding taxes for stock awards (1.8 ) (2.5 ) Common stock repurchases (200.0 ) (10.0 ) Dividends paid on common stock (76.3 ) (75.1 ) Other (3.1 ) (2.7 ) Net cash used in financing activities (104.9 ) (103.4 ) Effect of exchange rates on cash and cash equivalents 1.2 1.5 Net decrease in cash and cash equivalents (23.0 ) (4.3 ) Cash and cash equivalents as of the beginning of the fiscal period 199.5 193.1 Cash and cash equivalents as of the end of the fiscal period $ 176.5 $ 188.8 1 Presentation of prior year revolving credit facility and long-term debt activity has been conformed to the current year presentation. There was no change to net cash used in financing activities. THE TORO COMPANY AND SUBSIDIARIESReconciliation of Non-GAAP Financial Measures (Unaudited)(Dollars in millions, except per-share data) The following table provides a reconciliation of the non-GAAP financial performance measures used in this press release and our related earnings call to the most directly comparable measures calculated and reported in accordance with U.S. GAAP for the three and six month periods ended May 2, 2025 and May 3, 2024: Three Months Ended Six Months Ended May 2, 2025 May 3, 2024 May 2, 2025 May 3, 2024 Gross profit $ 436.7 $ 453.0 $ 772.3 $ 797.5 Productivity initiative1 3.7 — 7.5 — Adjusted gross profit $ 440.4 $ 453.0 $ 779.8 $ 797.5 Gross margin 33.1 % 33.6 % 33.4 % 33.9 % Productivity initiative1 0.3 % — % 0.3 % — % Adjusted gross margin 33.4 % 33.6 % 33.7 % 33.9 % Operating earnings $ 174.8 $ 187.6 $ 252.6 $ 276.2 Productivity initiative1 5.6 4.4 21.8 8.3 Adjusted operating earnings $ 180.4 $ 192.0 $ 274.4 $ 284.5 Operating earnings margin 13.3 % 13.9 % 10.9 % 11.7 % Productivity initiative1 0.4 % 0.3 % 1.0 % 0.4 % Adjusted operating earnings margin 13.7 % 14.2 % 11.9 % 12.1 % Earnings before income taxes $ 168.7 $ 179.2 $ 234.8 $ 259.3 Productivity initiative1 5.7 4.4 22.2 8.3 Adjusted earnings before income taxes $ 174.4 $ 183.6 $ 257.0 $ 267.6 Income tax provision $ 31.9 $ 34.4 $ 45.2 $ 49.6 Productivity initiative1 0.9 0.9 4.2 1.7 Tax impact of share-based compensation2 (0.2 ) 1.0 (0.1 ) 2.5 Adjusted income tax provision $ 32.6 $ 36.3 $ 49.3 $ 53.8 Net earnings $ 136.8 $ 144.8 $ 189.6 $ 209.7 Productivity initiative, net of tax1 4.8 3.5 18.0 6.6 Tax impact of share-based compensation2 0.2 (1.0 ) 0.1 (2.5 ) Adjusted net earnings $ 141.8 $ 147.3 $ 207.7 $ 213.8 Net earnings per diluted share $ 1.37 $ 1.38 $ 1.88 $ 2.00 Productivity initiative, net of tax1 0.05 0.03 0.18 0.06 Tax impact of share-based compensation2 — (0.01 ) — (0.02 ) Adjusted net earnings per diluted share $ 1.42 $ 1.40 $ 2.06 $ 2.04 Effective tax rate 18.9 % 19.2 % 19.3 % 19.1 % Productivity initiative1 (0.1 )% — % — % — % Tax impact of share-based compensation2 (0.1 )% 0.6 % (0.1 )% 1.0 % Adjusted effective tax rate 18.7 % 19.8 % 19.2 % 20.1 % 1 In the first quarter of fiscal 2024, the company launched the "Amplifying Maximum Productivity" or AMP initiative. The company considered the nature, frequency, and scale of this initiative compared to prior productivity initiatives when determining that the expenses associated with AMP, unlike prior productivity initiatives, are not common, normal, recurring operating expenses and are not representative of the company's ongoing business operations. Productivity initiative charges for the three and six month periods ended May 2, 2025 and May 3, 2024 primarily represent severance and termination benefits, facility exit costs, compensation for fully-dedicated AMP personnel, third-party consulting costs, and product-line exit costs. 2 The accounting standards codification guidance governing employee stock-based compensation requires that any excess or deficient tax deduction for stock-based compensation be immediately recorded within income tax expense. Employee stock-based compensation activity, including the exercise of stock options, can be unpredictable and can significantly impact our net earnings, net earnings per diluted share, and effective tax rate. These amounts represent the discrete tax benefits recorded as excess tax deductions for stock-based compensation during the three and six month periods ended May 2, 2025 and May 3, 2024. Reconciliation of Non-GAAP Liquidity Measures The company defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment. Free cash flow conversion percentage represents free cash flow as a percentage of net earnings. The company considers free cash flow and free cash flow conversion percentage to be non-GAAP liquidity measures that provide useful information to management and investors about the company's ability to convert net earnings into cash resources that can be used to pursue opportunities to enhance shareholder value, fund ongoing and prospective business initiatives, and strengthen the company's Consolidated Balance Sheets, after reinvesting in necessary capital expenditures required to maintain and grow the company's business. The following table provides a reconciliation of non-GAAP free cash flow and free cash flow conversion percentage to net cash provided by operating activities, which is the most directly comparable financial measure calculated and reported in accordance with U.S. GAAP, for the six month periods ended May 2, 2025 and May 3, 2024: Six Months Ended (Dollars in millions) May 2, 2025 May 3, 2024 Net cash provided by operating activities $ 123.1 $ 135.1 Less: Purchases of property, plant and equipment 38.4 39.5 Free cash flow $ 84.7 $ 95.6 Net earnings $ 189.6 $ 209.7 Free cash flow conversion percentage 44.7 % 45.6 % View source version on Contacts Investor Relations Jeremy SteffanDirector, Investor Relations(952) 887-7962, Media Relations Branden HappelSenior Manager, Public Relations(952) 887-8930, Sign in to access your portfolio
Yahoo
06-05-2025
- Business
- Yahoo
What Is The Toro Company's (NYSE:TTC) Share Price Doing?
The Toro Company (NYSE:TTC), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock's share price. But what if there is still an opportunity to buy? Let's examine Toro's valuation and outlook in more detail to determine if there's still a bargain opportunity. Our free stock report includes 1 warning sign investors should be aware of before investing in Toro. Read for free now. What's The Opportunity In Toro? Good news, investors! Toro is still a bargain right now. Our valuation model shows that the intrinsic value for the stock is $95.01, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Toro's share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it's there, it may be hard to fall back down into an attractive buying range. View our latest analysis for Toro What kind of growth will Toro generate? NYSE:TTC Earnings and Revenue Growth May 6th 2025 Future outlook is an important aspect when you're looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. Toro's earnings over the next few years are expected to increase by 26%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value. What This Means For You Are you a shareholder? Since TTC is currently undervalued, it may be a great time to increase your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation. Are you a potential investor? If you've been keeping an eye on TTC for a while, now might be the time to make a leap. Its buoyant future outlook isn't fully reflected in the current share price yet, which means it's not too late to buy TTC. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.
USA Today
05-03-2025
- Business
- USA Today
Seve Ballesteros' caddie for 1980 Masters dies; two winning Augusta caddies still alive
Seve Ballesteros' caddie for 1980 Masters dies; two winning Augusta caddies still alive On the 45th anniversary of caddying Seve Ballesteros to his 1980 Masters triumph, Marion Herrington has died. Herrington, born in 1949, began looping at Augusta National as a teenager in 1962 and last caddied for amateur James Driscoll at the 2001 Masters. According to Herrington's obituary, he died in December, and is survived by his wife, Elora (Peaches), and five children. With Herrington's passing, only two Augusta National caddies who won the Masters are still living: Ben Bussey (1982) and Carl Jackson (1984 and 1995). In 2022, Herrington opened up about his time at Augusta National, primarily about 1982 when the tradition of all Black caddies at the Masters Tournament was overturned by Chairman Hord Hardin. 'The policy that Mr. (Clifford) Roberts believed in was written in gold,' Herrington said. 'It was never supposed to change.' For Herrington, losing guaranteed income during Masters Week added hardship on his family. After his mother died, the caddie struggled to provide for his children. But, according to Herrington, membership at Augusta National had his back, none more than Minnesota business leader David Lilly. After learning of Herrington's situation, Lilly approached his personal caddie with an order. 'Mr. Lilly said, 'You tell Peaches to go pick out a house and I don't care what it costs,'' Herrington said. The caddie nodded with appreciation, but soon learned that he was eligible for an allowance through the GI Bill. 'I told Mr. Lilly, 'I don't need a house but sure could use a discount on a lawnmower.'' Lilly, the president of Toro Company, had a machine delivered. 'Mr. Lilly said, 'Marion, we're friends. Friends are supposed to help each other out.'' In 1991, as Augusta National prepared to close for the summer, Lilly informed Herrington that he was taking a bone fishing trip to the Florida Keys and they'd reunite when the club reopened in October. Marion wished him luck, and was caught by surprise when Augusta National caddie master Freddie Bennett phoned the last week of May. 'Freddie calls and says, 'Mr. Lilly's here at the club,'' Herrington recalled. There had been an executive committee meeting at Augusta National, where it was determined that Jack Stephens would succeed Hord Hardin. 'We were walking up No. 1 fairway when Mr. Lilly told me what happened,' Marion said. 'I don't believe in holding grudges, so I was never bitter at Hord Hardin. But things got a lot better for us under Jack Stephens.' Herrington lived in Augusta for 70 years before moving to Charlotte, NC, in 2020. After leaving Augusta National, Herrington caddied at Sage Valley Golf Club.
