NYSE$TTC

The Toro Company · Q1 2020 earnings

Q1 2020 earnings · · Investor relations

Briefing

Toro's first quarter of fiscal year 2020 experienced strong performance, driven by the Charles Machine Works acquisition and growth in the Residential segment.

Toro reported a strong start to fiscal 2020, with net sales increasing by 27.3% compared to the same period last year. The integration of Charles Machine Works is progressing well, and the company is on track to achieve synergy goals. The company maintains full-year adjusted EPS guidance range of $3.33 to $3.40 per diluted share, which includes the recently completed Venture Products acquisition

  • Net sales increased 27.3% compared to the same prior-year period.
  • Reported diluted EPS up 18.2%, and adjusted diluted EPS up 20.8%, compared to the same prior-year period.
  • Maintains full-year adjusted EPS guidance range of $3.33 to $3.40 per diluted share, which includes the recently completed Venture Products acquisition.
  • Residential segment net sales increased 14.3%, driven by shipments of zero turn riding mowers to new mass retail channel outlet.

Headline financials

Total Revenue

$767M

Previous: $603M+27.3%
EPS (adj)

$0.64

Previous: $0.51+25.5%
Gross Margin

37.5%

Previous: 35.8%+4.7%
Capital Expenditures

-$11.8M

Previous: -$14.2M+16.6%
Free Cash Flow

-$35.1M

Previous: $11.8M-397.5%
Net Income

$70.1M

Previous: $59.5M+17.7%
Operating Income

$91.1M

Previous: $70.1M+30.1%
Gross Profit

$288M

Previous: $216M+33.6%
Cash & Equivalents

$109M

Previous: $250M-56.4%
Total Assets

$2.49B

Previous: $1.62B+53.5%
Stock-Based Comp

$3.96M

Previous: $3.92M+0.9%

Revenue & EPS history

Toro · Revenue · Quarterly

$767M

Q1 2020+27.3%vs Q1 2019
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Toro · $767M total across 3 segments · Q1 2020

  • Professional
    $595M+30.7%
  • Residential
    $166M+14.3%
  • Other
    $6.91M+147.6%

Forward guidance

The company is maintaining its fiscal 2020 guidance, including net sales of about $3.6 billion and adjusted EPS of $3.33 to $3.40 per diluted share. For the second quarter, the company expects adjusted EPS of $1.28 to $1.33 per diluted share. Full year and second quarter 2020 guidance includes the benefit of Venture Products and nominal disruptions from coronavirus. Guidance excludes the benefit of the excess tax deduction for share-based compensation and acquisition and integration-related costs.

Tailwinds

  • Anticipated healthy demand for core products in golf, grounds, contractor and construction markets
  • Considerable pre-season excitement for new products displayed at recent industry trade shows
  • Realizing productivity and synergy gains from the Charles Machine Works acquisition
  • Seeing some benefit from the current commodity cost environment
  • Expect to see full year gross margin expansion

Headwinds

  • Unfavorable weather conditions may affect performance
  • More significant disruptions from coronavirus may affect performance
  • Factors beyond the company's control may affect performance
  • Maintaining focus on controlling what the company can control
  • Prepared to respond to factors that cannot be controlled

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q1 2020

Historical avgQ1 2020

-0.4%

Avg return

Earnings day

-1.0%

Avg return

5 days after

-1.3%

Avg return

30 days after

43%

30 / 69 earnings

Positive

+20.5%

Q2 2024

Best reaction

-17.4%

Q3 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026-2.4%+0.8%
Q1 2026-2.1%-1.8%-8.0%
Q4 2025+10.7%+8.0%+23.3%
Q3 2025-0.0%-2.2%-4.6%
Q2 2025+2.4%+3.1%+8.4%
Q1 2025-4.9%-3.3%-15.7%
Q4 2024-4.9%-6.0%-2.2%
Q3 2024-9.8%-9.0%-7.7%
Q2 2024+20.5%+19.8%+10.7%
Q1 2024-4.8%-5.9%-7.4%
Q4 2023+11.6%+10.7%+4.0%
Q3 2023-17.4%-17.4%-15.4%
Q2 2023-7.6%-6.3%-3.3%
Q1 2023-3.5%-2.4%-10.8%
Q4 2022-0.8%+0.9%-2.3%
Q3 2022-0.3%+2.6%+4.3%
Q2 2022+6.6%+7.7%-5.0%
Q1 2022-6.7%-14.6%-10.6%
Q4 2021+0.9%-4.9%+0.2%
Q3 2021+1.2%-1.4%-9.5%
Q2 2021-4.2%-2.8%+1.2%
Q1 2021-1.7%-2.7%+5.1%
Q4 2020+0.8%+1.7%+5.2%
Q3 2020+2.6%+2.4%+8.0%
Q2 2020+2.1%+1.4%-6.4%
Q1 2020-2.4%-4.7%-19.3%
Q4 2019-5.4%-1.6%+2.7%
Q3 2019-1.2%-1.7%+0.5%
Q2 2019-6.5%-7.9%-1.4%
Q1 2019+3.3%+2.6%+9.5%
Q4 2018-1.8%-2.9%-5.1%
Q3 2018-2.9%-0.9%+1.1%
Q2 2018+0.8%+0.2%-1.0%
Q1 2018+2.4%+3.3%-3.9%
Q4 2017+2.9%+0.8%+4.1%
Q3 2017-10.8%-12.6%-10.7%
Q2 2017+0.4%+1.2%+5.5%
Q1 2017-1.0%-0.8%+0.4%
Q4 2016+3.9%+1.5%+5.0%
Q3 2016+3.8%+5.0%+0.2%
Q2 2016-3.4%
Q1 2016+5.3%
Q4 2015+0.7%
Q3 2015-0.7%
Q2 2015+0.5%
Q1 2015-1.5%
Q4 2014-6.0%
Q3 2014+2.4%
Q2 2014+2.4%
Q1 2014-0.3%
Q4 2013-1.2%
Q3 2013+10.0%
Q2 2013+2.5%
Q1 2013-0.4%
Q4 2012-6.6%
Q3 2012+1.2%
Q2 2012-1.2%
Q1 2012+1.1%
Q4 2011+1.7%
Q3 2011-4.5%
Q2 2011-2.5%
Q1 2010-2.8%
Q1 2011-1.6%
Q4 2008-1.7%
Q4 2010-1.7%
Q2 2010-1.7%
Q4 2009+2.8%
Q3 2010+2.8%
Q3 2009+2.8%

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