Toro boosts its bottom line in Q4, even with a sales slip

The Toro Company reported "record" earnings for fiscal 2016, as well as an improvement in its bottom line for the fourth quarter -- even as sales slipped at the end of the year.

For the full fiscal year, net sales were up 0.1% to $2.39 billion. Net earnings of $231.0 million were up from 2015's earnings of $201.6 million.

During the fourth quarter, net sales decreased 2.6% to $468.4 million, and net earnings climbed to $30.2 million (compared to $23.6 million in the comparable 2015 period).

“We are pleased to announce record earnings for fiscal 2016, driven by consistent performance and growth in our professional businesses,” said Richard Olson, Toro’s president and CEO. “New product introductions across the portfolio were favorably received and we made notable progress in reducing our inventory levels."

"Despite challenges presented by negative currency conditions and a lack of in-season snowfall, we benefitted from solid demand for our golf equipment and irrigation products and we gained share in those markets," he added. "Similarly, we saw increased momentum in our landscape contractor, specialty construction and rental businesses due to the success of new products such as the TITAN HD zero turn mower and the Dingo TX 1000.”

The company announced its fiscal 2017 guidance, which projects revenue growth of 3% to 4% and net earnings between $2.20 and $2.26 per share.

“With fiscal 2017 already underway, we remain committed to delivering innovative products and serving customers across our businesses," added Olson. "As anticipated, pre-season demand for snow and ice management products was affected by the lack of snowfall last winter. However, mild autumn conditions extended the growing season in several areas, which benefitted our turf maintenance businesses. Recent weather patterns appear promising, and we are encouraged by the resulting retail activity. We will pay careful attention to inventory levels while ensuring we remain responsive to customer demand. As we embark on the last year of our Destination Prime employee initiative, we are committed to growth and profitability, while maintaining focus on working capital management. As always, we recognize that unfavorable weather conditions could negatively impact demand throughout the year, but we will maintain a steady approach in executing on our initiatives in the months ahead.”