Dec. 17, 2013
- 4Q non-cash impairment charge of $60 - 75 million (pre-tax)
- EPS impact expected to be $.28 - .35 per share
- Excluding this charge, underlying guidance for 2013 is unchanged
Leggett & Platt expects to record a
$60 - 75 million
(pre-tax) non-cash impairment charge during the fourth quarter related to its Commercial Vehicle Products group, which is part of the Specialized Products segment. The EPS impact of the non-cash charge should be between
28 and 35 cents
per share. Apart from this impairment charge, the company has made no change to the underlying full year EPS guidance issued in October.
As previously disclosed, the company had been considering strategic alternatives for its CVP unit, including possible divestiture of the business. As part of that process, it has become apparent that current market values for certain CVP assets, primarily goodwill, have fallen below recorded book values. This stems from lower expectations of future revenue and profitability, reflecting reduced market demand for the racks, shelving, and cabinets used in telecom, cable, and delivery vans. The company now intends to focus on improving the operating performance and cost structure of the CVP business.
At the end of the third quarter, the goodwill and other intangible assets associated with the CVP group were
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COMPANY DESCRIPTION: Leggett & Platt (NYSE: LEG) is a diversified manufacturer (and member of the S&P 500) that conceives, designs and produces a variety of engineered components and products that can be found in most homes, offices, and automobiles. The 130-year-old firm is comprised of 20 business units, 18,000 employee-partners, and 130 manufacturing facilities located in 18 countries.