The trend to cut water use and emissions while caring for golf courses and lawns helped drive results at Toro Co., where the first quarter exceeded earnings expectations.
The Bloomington-based maker of lawn mowers, irrigation systems and snowblowers saw a 5 percent jump in total equipment sales as more golf courses replaced large turf machines with newer models in advance of stricter U.S. emission rules that take effect this year.
At the same time, golf courses installed more Toro irrigation systems in the wake of dry spells that required better water management techniques. Sales were particularly robust in Australia, officials said.
Lastly, blizzards across the Northeast boosted professional snowblower sales late in the fiscal quarter. Those storms contrasted with last year’s slump, when the lack of snowfall left snowblowers unsold in hardware stores across the country.
“Recent snowfall across our primary snow markets, including a record-breaking blizzard that struck the Northeast, generated additional revenue for our contractor customers and is helping clear field inventories,” CEO Mike Hoffman told analysts during a conference call Thursday.
While contractor snowblower sales flourished, Toro conceded that its residential segment was experiencing reduced retail demand as snowfall levels nationwide remain below historic trends.
Besides being impacted by weather and regulations, Toro benefited from price hikes, factory cost-cutting and an influx of orders for new plow and trench products launched from the recently acquired Astec Underground and Stone Construction entities.
Thursday, Toro announced the purchase of a small Chinese micro-irrigation firm that will help it tap into a “critical growth market.” Terms were not disclosed.
Toro’s first-quarter earnings jumped 57 percent to $31.4 million, or 53 cents a share. On average, analysts expected just 43 cents a share. Sales rose 4.9 percent to $444.7 million.
Hoffman said he expects revenue to grow 4 to 5 percent in fiscal 2013 and for earnings to reach $2.40 to $2.45 a share. That’s up from its prior forecast of $2.35 to $2.40 a share. Second-quarter earnings should reach about $1.20 a share.
Toro closed Thursday at $44.75, down 49 cents