BLOOMINGTON, Minn. – Lawnmower maker Toro on Wednesday said its second-quarter earnings before items rose 10.6 percent on stronger sales of residential mowers through both home improvement retailer Home Depot Inc. and its dealer network. "We are pleased with our net earnings results for the second quarter," said Kendrick Melrose, chairman and chief executive officer, in a Toro news release.
The Bloomington, Minnesota-based company said earnings before items for the quarter that ended May 3 rose to $36.4 million, or $2.78 a share, from $32.9 million, or $2.49 a share in the same quarter a year ago.
Year-ago results were restated to reflect new accounting rules that allow companies to stop writing off goodwill – the difference between the price paid to acquire a company and the fair value of its assets – on a quarterly basis.
Overall sales rose 2.3 percent to $470.3 million from $459.6 million a year earlier.
Professional sales were down slightly, 1.6 percent to $290.2 million. Sales were up in both the commercial equipment and irrigation categories due to the successful introduction of new products, such as new rotaries and sprinkler heads, as well as customer sales that were postponed last year.
The late spring and higher than expected field inventories entering the season caused a reduction in the landscape contractor business for both Toro and Exmark products. Toro does not believe that all of the shortfall will be recovered and has therefore reduced its forecast for the year's landscape contractor business, even though retail movement of this product continues to be strong.
However, results exceeded an outlook Toro had given in mid-February. At that time, it said it expected second-quarter earnings before items of $2.65 a share to $2.75 a share.