Leggett & Platt Reports Financial Results for Second Quarter 2025

July 31, 2025  by Karen Parrish in Business Strategy, Industry   

- 2Q sales of $1.1 billion, a 6% decrease vs 2Q24

- 2Q EPS of $.38, 2Q adjusted¹ EPS of $.30, a $.01 increase vs adjusted¹ 2Q24 EPS

- Strengthened balance sheet primarily through debt reduction of $143 million during the quarter, leading to an improved net debt to 12-month trailing adjusted EBITDA¹ ratio of 3.5x

- Maintained 2025 sales and adjusted EPS guidance

- Amended credit facility agreement effective July 24, including extending the maturity to July 2030

President and CEO Karl Glassman commented, "We are pleased to report another quarter of profitability improvement. We further strengthened our balance sheet by reducing debt and favorably amending our revolving credit facility. We also remain on track to complete the sale of our Aerospace business this year. The continued progress on our strategic initiatives is a direct reflection of the dedication and talent of our employees.

"In the face of ongoing macroeconomic headwinds and uncertainty surrounding global trade policy, we remain confident in the strength and resilience of our business. Our focused execution and diversified portfolio give us the conviction to reaffirm our full-year guidance for both sales and adjusted EPS. We remain focused on creating long-term value for our shareholders. Our actions are aligned with our strategy to build a stronger, more agile company positioned for long-term, sustainable growth."

SECOND QUARTER RESULTS
Second quarter sales were $1.1 billion, a 6%² decrease versus second quarter 2024

- Organic sales³ were down 6%

- Volume was down 7%, primarily from continued soft demand in residential end markets, Automotive, and Hydraulic Cylinders. These declines were partially offset by higher trade wire and rod sales and growth in Textiles, Work Furniture, and Aerospace.

- Raw material-related selling price increases and currency benefit increased sales 1%

Second quarter EBIT was $90 million, a $705 million increase from second quarter 2024. Adjusted¹ EBIT was $76 million, a $4 million increase from second quarter 2024 adjusted¹ EBIT.

- 2Q 2025 adjustments include: $4 million of restructuring charges and $18 million gain from real estate sales

- 2Q 2024 adjustments include: $675 million non-cash goodwill impairment, $11 million of restructuring charges, $4 million of CEO transition costs, and a $5 million gain from the sale of real estate

- Adjusted¹ EBIT increased primarily from metal margin expansion, restructuring benefit, and disciplined cost management partially offset by lower volume

EBIT margin was 8.5%, up from (54.4%) in the second quarter of 2024, and adjusted¹ EBIT margin was 7.1%, up from 6.3%.

Second quarter EPS was $.38 versus a loss of $4.39 in second quarter 2024. Second quarter adjusted¹ EPS was $.30, up $.01 versus second quarter 2024 adjusted¹ EPS of $.29.

RESTRUCTURING PLAN UPDATE

- Estimates have been updated due largely to our decision to retain a small number of facilities that were previously identified for closure

- Annualized EBIT benefit of $60–$70 million expected to be realized after initiatives are fully implemented

- Realized $13 million of incremental⁴ EBIT benefit in second quarter 2025

- Expect approximately $35–$40 million of incremental⁴ EBIT benefit to be realized in 2025 and approximately $5–$10 million of incremental⁴ EBIT benefit in 2026

Anticipate approximately $65 million of annual sales attrition after initiatives are fully implemented versus our prior expectations of $80 million

- Realized $11 million of incremental⁴ sales attrition in second quarter 2025, including $3 million from the divestiture of a small U.S. machinery business in our Bedding Products segment

- Expect approximately $45 million of incremental⁴ sales attrition in 2025 and approximately $5 million of incremental⁴ sales attrition in 2026

Estimate real estate proceeds of $70–$80 million versus our previous estimate of $60–$80 million

- Of the remaining $30–$40 million of cash proceeds, now anticipate $0–$10 million in the second half of 2025 with the balance in 2026 due to timing of listing properties

Expect restructuring and restructuring-related costs from inception of $65–$75 million versus our prior estimate of $80–$90 million

- Anticipate cash restructuring and restructuring-related costs of $40–$45 million

- Expect non-cash restructuring and restructuring-related costs to be $25–$30 million

2025. GUIDANCE

- Sales and adjusted EPS are unchanged and contemplates owning Aerospace for the full year

- Sales are expected to be $4.0–$4.3 billion, down 2% to 9% versus 2024

- Volume is expected to be down low single to low double digits (versus down low to high single digits)

- Volume at the midpoint:

- Down mid-teens in Bedding Products segment (versus down low double digits)

- Down mid-single digits in Specialized Products segment

- Down low single digits in Furniture, Flooring & Textile Products segment

- Raw material-related price increases and currency benefit are expected to be up low single digits (versus flat to up low single digits)

EPS is now expected to be $0.88–$1.17 (versus prior guidance of $.85–$1.26)

- Earnings expectations include:

- $.08 to $.13 per share impact from restructuring costs

- $.11 per share fourth quarter impact from a non-cash settlement charge related to the termination of a pension plan

- $.12 to $.16 per share gain from sales of real estate, consisting of real estate exited from restructuring initiatives and idle real estate

Adjusted EPS is expected to be $1.00–$1.20

At the midpoint, increase versus 2024 due primarily to metal margin expansion and restructuring benefit partially offset by lower volume

Based on this framework, 2025 EBIT margin is expected to be 5.9%–6.8%; adjusted EBIT margin is expected to be 6.5%–6.9%

Additional expectations:

- Depreciation and amortization $125 million (versus $135 million)

- Net interest expense $70 million

- Effective tax rate 26% (versus 25%)

- Fully diluted shares 139 million

- Operating cash flow $275–$325 million

- Capital expenditures $80–$90 million (versus $100 million)

- Minimal acquisitions and share repurchases

SLIDES AND CONFERENCE CALL
A set of slides containing summary financial information, tariff overview, and restructuring update is available from the Investor Relations section of Leggett's website at www.leggett.com. The conference call may be accessed through Leggett's Investor Relations website,

FOR MORE INFORMATION: Visit Leggett's website at www.leggett.com.