Leggett & Platt (LEG) Q4 2024 earnings summary

Executive summary

• 2024 featured significant restructuring for operational efficiency and cost reduction, especially in Bedding Products, Home Furniture, Flooring, and Hydraulic Cylinders, with 14 bedding locations closed and U.S. innerspring production consolidated.

• The company realized a $22 million EBIT benefit from restructuring, exceeding expectations, and generated $20 million in real estate proceeds.

• Product innovation and customer partnerships remained a focus, with new launches and collaborations in bedding, furniture, and flooring.

• Demand challenges persisted due to weak residential, automotive, and hydraulic cylinder markets, affordability issues, and macroeconomic uncertainty.

• Major non-cash goodwill impairment charges of $676 million and $50 million in restructuring charges were recorded in 2024.

Financial highlights

• Q4 2024 sales were $1.1 billion, down 5% year-over-year; full-year 2024 sales were $4.4 billion, down 7% from 2023.

• Q4 adjusted EBIT was $56 million (5.3% margin), down $10 million from Q4 2023; full-year adjusted EBIT was $267 million (6.1% margin), down $67 million.

• Q4 adjusted EPS was $0.21, down $0.05 year-over-year; full-year adjusted EPS was $1.05, down $0.34 from 2023.

• Operating cash flow for 2024 was $306 million, down $191 million from 2023; capital expenditures were $82 million.

• Net debt to trailing 12-month adjusted EBITDA at year-end was 3.76x; total liquidity was $793 million.

Outlook and guidance

• 2025 sales expected at $4.0–$4.3 billion, down 2–9% from 2024, with volume expected down low to mid-single digits.

• 2025 adjusted EPS guidance is $1.00–$1.20, reflecting restructuring benefits and operational improvements, but offset by lower volume.

• Full-year adjusted EBIT margin expected at 6.4%–6.8%; operating cash flow projected at $275–$325 million.

• Restructuring costs for 2025 expected at $30–$40 million, with total plan costs now $80–$90 million.

• Annualized EBIT benefit from restructuring expected at $60–$70 million by late 2025.