CARTHAGE, Mo. – In this morning’s second quarter earnings call, Leggett & Platt referenced a “strategic review” of its expansive portfolio to determine what works best for the company as it continues to undergo its restructuring plan.
The company reported a net loss of net loss of $602.1 million in the second quarter and net sales of $1.1 billion, an 8% slide from $1.22 billion in the prior year period. Leggett & Platt cited sluggish demand in the furniture and bedding segments.
In his first earnings call since retaking the reins as president and CEO in May, Karl Glassman outlined the company’s challenges and offered an update on Leggett & Platt’s ongoing restructuring announced late last year that includes plant closings and consolidations throughout the company’s network. The ear-perking moment came during discussion with analysts in prepared remarks regarding a review of the company’s holdings.
“Additionally, we are currently conducting a strategic review of our diverse portfolio, asking ourselves if we are the rightful owner of each business and how each one fits into our long-term vision,” Glassman said. “As we work through our restructuring plan and operational improvement initiatives, including our G&A (general and administrative) analysis, and we make progress in our portfolio review, a sharper view of our future is emerging.
“We will continue gaining visibility in the coming quarters, and we’ll share additional details as work continues,” he said. “We also anticipate sharing an updated and comprehensive long-term vision including financial targets mid next year. We fully expect that the future Leggett & Platt will be more focused and more profitable.”
When pressed for more details by analysts, Glassman declined to elaborate saying “I think that you should expect a smaller, more focused company in the future. By our history, we don’t divulge any potential divestitures until we’re under an LOI (letter of intent). So there’s more to come, but there’s a lot of activity.”
As for a timeline, Glassman estimated that more details could be shared early next year. “It just takes a long time to get through some of these processes,” he said. “Some of our businesses are very complex geographically, multiproduct. So, yes, I would say first half of next year.”
Glassman continued saying that “everything is being evaluated” adding that the “businesses that we’re going to lean into – bedding, automotive, geo (components) and I would say all textiles. …. Really the screen is fit growth potential and our ability to execute in whatever those markets are.”