Diversified furniture components manufacturer Leggett & Platt has reported a decline in third quarter sales.
According to its latest trading update, Q3 2023 sales fell 9% to $1.18bn, with organic sales down by 11%. Volume was down 6%, primarily from demand softness in domestic residential end markets, partially offset by growth in its Aerospace and Automotive businesses.
Raw material-related selling price decreases, net of currency benefit, reduced sales 5%.
Third quarter EBIT was $91m, down $22 million or 19% from third quarter 2022 EBIT, and adjusted EBIT was $86m, a $27m decrease.
Within its categories, Bedding Products saw trade sales decline 17%, with volumes down 8%, primarily due to demand softness in domestic markets. Furniture, Flooring & Textile Products also saw a decline in sales, down by 11%, with volumes decreasing 11%.
Looking ahead, L&P has lowered its guidance and expects sales to be $4.7–$4.75 billion, -8% to -9% versus 2022.
President and CEO Mitch Dolloff commented: “I would like to thank our employees for their tremendous efforts in what was another challenging quarter. Ongoing weak demand impacted our Bedding Products and Furniture, Flooring, & Textile Products segments but was partially offset by continued demand strength in our Specialized Products segment.
“We are lowering our full year guidance to reflect continued volatility in the macroeconomic environment, continued low consumer demand in residential end markets, and the modest impact we have experienced so far from the UAW strike on several North American automakers. The UAW strike had minimal impact on our Automotive business in the third quarter. So far in the fourth quarter, the sales impact has been approximately $5 million, which may not be indicative of future impacts. Due to uncertainties around the duration and severity of the strike, our updated full year guidance does not include impacts beyond what we have experienced so far.
“We are focused on anticipating and adapting to market changes, improving operating efficiency, driving strong cash management, and engaging with our customers on new product opportunities. We are evaluating opportunities across our businesses, including further integration of our specialty foam and innerspring operations, that are expected to support improved profitability, a strong balance sheet, and continued shareholder returns.”
