Bloomington, Minn.-based The Toro Co. reported record highs in sales and earnings for the second quarter, despite a double-digit sales decline in the residential division.
The company posted net earnings of $78.4 million, on a net sales increase of 1.9%, to $704.5 million for its fiscal second quarter ended May 3.
In the comparable fiscal 2012 period, the company delivered net earnings of $68.8 million on net sales of $691.5 million.
“We achieved record sales and earnings in the quarter, despite this year’s challenging weather pattern compared with a year ago,” said Michael Hoffman, Toro’s chairman and CEO. “In 2012, we enjoyed ideal spring conditions with a warm, early start to the season, while this year much of North America and Europe have dealt with unusually cold weather. These conditions delayed sales, especially of our residential products, which are more immediately impacted by weather."
Residential segment net sales were down 13.2% in the quarter to a total of $201.4 million. Unfavorable weather delayed the start of the spring goods selling season, negatively impacting the sales of walk power mowers and riding products. For the first six months, residential segment net sales were $322.3 million, down 12.8% from the comparable fiscal 2012 period. The year-to-date sales results were largely attributable to the unusually mild winter and the late start to spring, the company said.
The company's golf and micro irrigation businesses have been strong, it said.
“Even with a marginal winter season and late start to spring, we remain cautiously optimistic about the remainder of the year,” said Hoffman.
“Retail activity in our residential business started to pick up in late April, and the momentum is continuing in May," Hoffman said. "Looking forward, we face favorable comparisons to last year, when much of the United States struggled with drought conditions during the summer months."
The company now expects revenue growth for fiscal 2013 to be about 3% to 4%.