Diversified furniture components manufacturer Leggett & Platt has reported a decline in third quarter sales.
According to its latest trading update, Q3 2024 sales were down 6% to $1.1bn, with volumes declining 4%, primarily from continued weak demand in residential end markets.
Third quarter EBIT was $78m, down $13m from third quarter 2023 EBIT.
In the quarter, its Bedding Products division saw sales fall 8%, with volumes down 3%, primarily due to the expected loss of a customer in Specialty Foam and demand softness in U.S. and European bedding markets, partially offset by higher trade rod and wire sales.
Furniture, Flooring & Textile Products saw sales decline 4% with volumes down 2%, primarily from declines in Home Furniture, Geo Components, and Fabric Converting.
Full year 2024 sales and EPS guidance has been lowered as demand is weaker than previously anticipated, particularly within its Specialized Products and Furniture, Flooring & Textile Products segments. Sales are expected to be $4.3–$4.4 billion, down 7% to 9% versus 2023 (vs prior guidance of $4.3–$4.5 billion).
President and CEO Karl Glassman commented, “We continued to make solid progress on our restructuring and operating efficiency improvement initiatives, although demand headwinds were more challenging than anticipated in the third quarter. Despite weaker than expected results, we paid down $124 million of debt and adjusted EBIT margin improved by 60 basis points sequentially this quarter.
“We expect weak demand in our residential end markets to persist into the fourth quarter due to a more challenging macro environment and softening in consumer spending. Additionally, our Automotive business continues to face headwinds from varying impacts of the transition to electric vehicles, consumer affordability issues, and economic softness in Europe. As a result, we are reducing our sales and EPS guidance.
“We are focused on simplifying our portfolio to businesses that are the right long-term fit. As a part of this strategic review, we are exploring the potential sale of our Aerospace business. Looking forward, we are confident that the actions we are taking to strengthen our balance sheet, improve operating efficiency and margins, and position ourselves for future growth opportunities will create long-term shareholder value.”
