Toro Clocks 9% Sales Growth in Q2, Raises FY22 Outlook

Toro Co TTC reported second-quarter FY22 sales growth of 8.7% year-over-year to $1.25 billion, missing the consensus of $1.27 billion.
Adjusted EPS was $1.25, beating the consensus of $1.23.
Sales by segments: Professional $925.8 million (+11.8% Y/Y), and Residential $319.7 million (+1.5% Y/Y).
The gross margin reduced to 32.4%, from 35.1% in 2Q21. The adjusted gross margin was 32.5%, compared with 35.1% a year ago.
Operating earnings reduced by 5.6% Y/Y to $170.58 million, and the margin declined by 207 bps to 13.7%. The adjusted margin was 13.8% compared to 15.7% in 2Q21.
Toro's cash generated from operating activities for the six months was $42.86 million, compared to $318.62 million a year ago. Adjusted free cash flow was $6.89 million.
The company held cash and equivalents of $263.23 million as of April 29, 2022.
FY22 Outlook: Toro raised its FY22 net sales guidance; it now expects sales growth of 14% to 16% (prior expectation of 12% to 14%).
It expects an adjusted EPS of $4.00 - $4.15 (prior view $3.90 - $4.10) versus the consensus of $4.01.
Price Action: TTC shares traded higher by 0.59% at $81.47 on the last check Thursday.

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