Last September they told investors that excess cash flow would go toward either acquisitions or share repurchases. Consistent with that strategy, they were strong buyers oftheir stock during the quarter, purchasing 1.8 million shares.
These purchases were partially offset by issuance of shares through employee plans. As a result, common stock outstanding declined by 1.4 million shares during the quarter, and was 3.1 million shares, or 1.6 percent, below the level of one year ago.
"During the quarter they spent $44 million on acquisitions, $49 million to repurchase stock, and $44 million on capital projects. These initiatives were funded by cash from operations and an increase in net debt. As explained last September, over a three year period they intend to gradually increase leverage. They are aiming for a net debt-to-cap target range of 30 percent - 40 percent, and ended the quarter with net debt-to-cap at 24.3 percent."
"They continue to be optimistic about the future, and expect to post record sales and earnings for 2005."
Acquisitions and Divestitures During the quarter the company completed three acquisitions that will add about $48 million to annual sales. The largest of these involved Leggett's purchase of assets from a manufacturer of rubber and felt carpet underlay, and should contribute approximately $41 million in annual sales to the Residential Furnishings segment. The company also divested two small operations that previously generated annual revenue of about $5 million.
marketing@alchempro.com
