The acquisition of Charles Machine Works helped push Toro Co.’s annual revenue growth to 20%, resulting in annual sales topping $3 billion for the first time.
The integration of Oklahoma-based Charles Machine Works, acquired in April, is ahead of plan, allowing forward momentum as Toro heads into 2020, said Richard Olson, chairman and chief executive of Bloomington-based Toro.
“The year was marked by record results, the transformational acquisition of Charles Machine Works and strong demand for snow and ice management products in our professional and residential segments,” Olson said in a statement.
For the fourth quarter ended Oct. 31, Toro earned $38.3 million, or 35 cents per share, on revenue of $734.4 million. Excluding acquisition costs and other management actions related to Toro shutting down some of its Toro brand underground construction products and services, the company reported adjusted EPS of 48 cents per share.
That compares with the fourth quarter last year when Toro had revenue of $539 million and adjusted EPS of 32 cents per share.
The adjusted EPS was better than the 46 cents per share analysts tracked by Thomson Reuters expected for the quarter. Toro did miss on analysts’ estimated revenue of $745 million.
For the year, Toro had revenue of $3.1 billion, up 20% from the previous year, and its adjusted EPS grew 12% to $3 per share.
The acquisition of Charles Machine Works, the maker of underground construction equipment including Ditch Witch and American Augers, in a $700 million deal was the largest in Toro’s history. The move helped increase sales for Toro’s professional division by 47% for the quarter and 26% for the year.
The professional segment also saw a boost from sales of its Boss snow and ice management products. Large snowfalls at the end of the winter season and new product introductions from Boss helped sales of the brand.
Sales from the residential segment were up 2% for the quarter and 1% for the year.
Looking out to fiscal 2020, Toro will have a full year of sales from Charles Machine Works and the benefit of a partnership it signed in September to sell Toro zero-turn mowers, walk mowers and portable power equipment in Tractor Supply stores nationwide starting this spring. The company expects to have annual sales of $3.6 billion and adjusted EPS in the range of $3.33 to $3.40 per share.
Shares of Toro closed Wednesday at $75.75, down 6%. Year to date, Toro’s stock is up 34%.