Diversified wire product manufacturer Leggett & Platt reported second quarter sales of $1.1 billion, an increase of 11 percent versus second quarter 2017. Organic sales grew 10 percent, with volume up 6 percent from strength in Automotive, Bedding, Adjustable Bed and several other businesses. Raw material-related price increases and currency impact added 4 percent. Acquisitions contributed 3 percent to sales growth but were partially offset by divestitures, the company said in a press release.
Second quarter earnings were $0.63 per share, down $0.01 versus the $0.64 per share earned in second quarter 2017. The earnings benefit from sales growth was more than offset primarily by higher raw material costs, the timing of the pricing lag the company experiences when passing along the higher costs, and the corresponding increased LIFO expense. As expected, EBIT and EBIT margin declined versus second quarter last year largely due to these same factors.
The company also said it is reducing sales and EPS guidance for the full year due to a combination of factors. Home Furniture and Fashion Bed have been negatively impacted by softening demand and higher steel costs. While Adjustable Bed demand remains very strong year-over-year, sales to some major retailers are lower than previously expected, the company said.
President and CEO Karl G. Glassman commented, "We are pleased with our second quarter sales, with growth coming from strength in several businesses, including Automotive, Bedding, Adjustable Bed, Aerospace, Geo Components and Work Furniture. Steel-related price increases and currency impact also contributed to sales growth this quarter. These gains were partially offset by soft demand in Home Furniture and Fashion Bed.”