Toro's annual revenue climbs over $4 billion for first time

Toro nearly doubled its fourth-quarter profits, but officials warned that fiscal 2023 would see slowing sales and earnings.

The Bloomington-based maker of outdoor maintenance and underground construction equipment earned $117.6 million, or $1.12 a share, in its fourth quarter ended Oct. 31. Quarterly revenue increased 22% to $1.17 billion.

Quarterly earnings increased 96% — and earnings per share doubled — mainly due to price increases. Adjusted earnings per share were $1.11 a share, a 98% increase over the same period a year ago, and beat a consensus analyst estimate of $1.09 a share.

The forecast for 2023 is an annual sales increase of 7% to 10% and adjusted earnings per share to grow 12% to 17%. Officials pointed to a residential market that is returning to normal after a large pandemic bump as people concentrated on home decor and equipment.

The company for this fiscal year reached a milestone: topping $4 billion in sales.

"We delivered record top and bottom line results in the quarter and for fiscal 2022, with full-year net sales exceeding $4 billion for the first time in company history," said Chief Executive Richard Olson.

Demand in the professional segment offset residential segment sales in the quarter. Olson told analysts on the company's earnings call that the company will be watching business and consumer confidence in 2023 — and continue to track inflation and monetary policy.

Supply constraints are still a challenge but a strong order backlog is giving Toro momentum heading into the new fiscal year. Toro provided guidance for fiscal 2023 saying they expect sales to grow 7% to 10% and adjusted EPS to be in the range of $4.70 to $4.90 a share.

"While we acknowledge the heightened level of macroeconomic uncertainty, we expect to benefit from our well-established market leadership, along with the essential nature and regular replacement of our products," Olson said in a news release.