Toro Company sees Q2 adjusted EPS ‘meaningfully lower than last year’s record’

Toro executives stated during the company’s Q1 earnings call: “Moving to the second quarter of fiscal 2024. We anticipate total company net sales to be similar to slightly higher year-over-year. As a reminder, in the second quarter of fiscal 2023, we benefited from dealer and distributor inventory replenishment of contractor-grade zero-turn mowers, following a period of constrained supply. The same dynamic is not present this year. We anticipate this will be more than offset by expected incremental benefits from our expanded mass retail channel and our focus on driving increased output for our businesses with elevated order backlog. Given these considerations, we expect Professional segment net sales for the second quarter to be down mid-single digits, on top of last year’s strong comparison of 15.4% growth. We expect Residential segment net sales growth for the second quarter to be up low to mid-20s, compared to the same period last year. Looking at profitability. For the second quarter, we anticipate total company adjusted operating margin to be lower than the same period last year. This reflects our expectations for segment mix and some continued inefficiencies as we align production to demand trends. We expect the Professional segment earnings margin to be lower on a year-over-year basis. And the Residential segment earnings margin to be higher year-over-year. Overall, we expect our second quarter fiscal 2024 adjusted diluted EPS to be meaningfully lower than last year’s record results and more in line with fiscal 2021 and 2022 results.” Q2 EPS consensus $1.55.