With the recession showing "no signs of abating," Toro Co. CEO Michael Hoffman said Thursday that he now expects revenue to fall by 15 percent in the fiscal year that ends in October.
That's triple the decline Toro estimated Dec. 10, when the Bloomington-based manufacturer said it expected sales to drop by 5 percent for the year.
Hoffman told Wall Street analysts that the slowdown "continues to intensify, and we expect these difficult conditions will continue for the remainder of our fiscal year." Toro now estimates that earnings per share for the full year will be $1.75 to $2, down from December guidance of $2.50 to $2.70.
Toro on Thursday reported a first-quarter profit of $6.7 million, down 64 percent, as sales fell 16.2 percent to $340.2 million. Earnings per share were 18 cents, in line with analysts' estimates.
Toro stock closed at $24.02 Thursday, down $1.86 or 7.19 percent.
On the residential side of the business, which includes Toro's mainstay lawnmowers, sales rose slightly, but sales in the professional products division, which includes golf maintenance equipment and irrigation systems, plummeted 22.3 percent.
In the past two months, Hoffman said, the economy has gotten "substantially worse." Even in Dubai, where Hoffman said that golf courses were being constructed at a "crazy" pace, course development has slowed as oil prices have receded from historic high levels.
James Lucas, an analyst for Janney Montgomery Scott, said in a Thursday report that "Toro is in the same sinking boat as most other companies." But he added that Toro has not abandoned its investments in research and development and "will be well positioned for the eventual turn" in the economy.
Toro also announced Thursday that it secured a contract with the U.S. Army to provide golf course maintenance equipment at about 50 golf courses around the world.
Liz Fedor • 612-673-7709