Leggett & Platt 8-K Hints at Restructuring Costs, Impairments

Ticker: LEG · Form: 8-K · Filed: Jan 16, 2024

Sentiment: mixed

Topics: restructuring, impairment, financial-condition

TL;DR

**L&P just filed an 8-K hinting at big financial hits from restructuring and asset write-downs.**

AI Summary

Leggett & Platt, Inc. filed an 8-K on January 16, 2024, reporting an event on January 11, 2024, related to 'Results of Operations and Financial Condition,' 'Cost Associated with Exit or Disposal Activities,' and 'Material Impairments.' This indicates the company is likely disclosing significant financial changes, potentially including restructuring costs or asset write-downs. This matters to investors because these items can directly impact the company's profitability and future financial health, signaling potential challenges or strategic shifts.

Why It Matters

This filing suggests Leggett & Platt is undergoing significant financial adjustments, which could affect its earnings and asset values, directly impacting shareholder equity and future stock performance.

Risk Assessment

Risk Level: medium — The filing mentions 'Cost Associated with Exit or Disposal Activities' and 'Material Impairments,' which typically indicate negative financial events that could impact profitability.

Analyst Insight

Investors should await the full details of the financial statements and exhibits mentioned in the filing to understand the magnitude of the 'Cost Associated with Exit or Disposal Activities' and 'Material Impairments' before making investment decisions.

Key Players & Entities

FAQ

What specific items did Leggett & Platt Inc. report in this 8-K filing?

Leggett & Platt Inc. reported items related to 'Results of Operations and Financial Condition,' 'Cost Associated with Exit or Disposal Activities,' 'Material Impairments,' 'Regulation FD Disclosure,' and 'Financial Statements and Exhibits' as per the ITEM INFORMATION section of the filing.

What was the earliest event date reported in this 8-K filing?

The earliest event reported in this 8-K filing occurred on January 11, 2024, as stated under 'Date of Report (Date of earliest event reported) January 11, 2024'.

What is the business address of Leggett & Platt, Incorporated?

The business address of Leggett & Platt, Incorporated is No. 1 Leggett Road, Carthage, MO 64836, as listed in the BUSINESS ADDRESS section.

What is the trading symbol and exchange for Leggett & Platt, Incorporated's Common Stock?

The Common Stock, $.01 par value, of Leggett & Platt, Incorporated trades under the symbol 'LEG' on the New York Stock Exchange, as indicated under 'Securities registered pursuant to Section 12(b) of the Act'.

What is the company's Central Index Key (CIK) and Standard Industrial Classification (SIC)?

The company's Central Index Key (CIK) is 0000058492, and its Standard Industrial Classification (SIC) is HOUSEHOLD FURNITURE [2510], according to the FILER COMPANY DATA section.

Filing Stats: 2,068 words · 8 min read · ~7 pages · Grade level 13.9 · Accepted 2024-01-16 07:04:00

Key Financial Figures

Filing Documents

02

Item 2.02 Results of Operations and Financial Condition. The information contained in Item 2.06 under "Additional Impairment" regarding the impairment of certain long-lived assets, including customer relationships, technology, and trademark intangibles in our Bedding Products segment, and the estimated impact on the Company's completed fourth quarter and year-end 2023 results of operations, is incorporated herein by reference. The Company is not otherwise updating guidance for, or reporting upon, its 2023 year-end financial results. These financial results will be released on February 8, 2024. On January 16, 2024, the Company issued a press release disclosing, in part, an intangible impairment charge impacting the Company's completed fourth quarter and year-end 2023 results of operations. The press release is attached as Exhibit 99.1 and the "Fourth Quarter 2023 Impairment Charge" section in such press release is incorporated herein by reference. This information is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the " Exchange Act "), or otherwise subject to the liabilities of that section. This information shall not be incorporated by reference into any document filed under the Securities Act of 1933, as amended (the " Securities Act "), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

05

Item 2.05 Costs Associated with Exit or Disposal Activities. On January 11, 2024, the Board approved, and the Company committed to a restructuring plan primarily associated with our Bedding Products segment, and to a lesser extent our Furniture, Flooring & Textile (" FF&T ") Products segment (the " Restructuring Plan "). In response to evolving markets, the Company anticipates taking actions pursuant to the Restructuring Plan to improve manufacturing and distribution efficiency, advance its product strategy, and further support customer needs. The Restructuring Plan is designed to create a portfolio of products and an operating footprint aligned with the markets we serve. The bedding market has experienced unprecedented change in recent years and the competitive landscape has continued to evolve. Optimizing our manufacturing and distribution footprint should reduce complexity, improve overall efficiency and align capacity with anticipated future market demand. These actions are expected to allow us to further integrate our specialty foam and innerspring capabilities, while maintaining our service and quality levels. We plan to consolidate between 15 and 20 of 50 production and distribution facilities in the Bedding Products segment. Also, in our FF&T Products segment, we plan to consolidate a small number of production facilities in our Home Furniture and Flooring Products business units. The production in the affected facilities is expected to be consolidated into other facilities, or in a few cases, eliminated. Also, we expect to reduce workforce levels over time by 900 to 1,100. In total, the initiatives across the segments are expected to reduce annual sales by approximately $100 million. Additionally, we anticipate receiving between $60 and $80 million in pre-tax net cash proceeds from the sale of real estate associated with the Restructuring Plan. These transactions are expected to be largely complete by the end of 2025. In aggregate, we expect to i

06

Item 2.06 Material Impairments. To the extent applicable, the information contained in Item 2.05 is incorporated into this Item 2.06 by reference. Additional Impairment Our long-lived assets are tested for recoverability at year end and whenever events or circumstances indicate the carrying value may not be recoverable. In addition to, and unrelated to the Restructuring Plan, the Company concluded that an impairment existed in our Bedding Products segment with respect to certain long-lived assets, including customer relationships, technology, and trademark intangibles related to prior year acquisitions. Macroeconomic factors have negatively impacted consumer confidence in the bedding industry and prolonged weak demand has created disruption and financial instability with some of our customers. As such, recent efforts by certain customers to improve their financial position were considered a triggering event, late in the fourth quarter of 2023, to review the long-lived assets for potential impairment. We conducted an evaluation and determined in early January 2024, that our sales and earnings forecasts should be reduced. Based on this determination, and after further analysis, we concluded, on January 12, 2024 that the Company will record an estimated pre-tax impairment charge of approximately $450 million related to long-lived assets (primarily the intangibles). This impairment charge will not result in future cash expenditures, and will be recorded as a non-cash charge in the fourth quarter of 2023.

01

Item 7.01 Regulation FD Disclosure. On January 16, 2024, the Company issued a press release disclosing the Restructuring Plan and the intangible impairment charge impacting the Company's fourth quarter 2023 results of operations. The press release is attached as Exhibit 99.1 and is incorporated herein by reference. Also attached hereto as Exhibit 99.2 and incorporated herein by reference are presentation materials regarding the Restructuring Plan. This information is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section. This information shall not be incorporated by reference into any document filed under the Securities Act, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. Forward-Looking Statements . This Current Report on Form 8-K contains "forward-looking" statements including the estimates of the amounts, types and timing of costs (cash and non-cash) and impairment charges (including inventory obsolescence) aggregately and by segment; the amount of reduction of sales; the amount and timing of proceeds from the sale of facilities; the number of Bedding Products segment and FF&T Products segment facilities to be consolidated; the amount of pre-tax impairment charge related to long-lived assets; and the underlying assumptions relating to the forward-looking statements. These statements are identified either by the context in which they appear or by use of words such as "anticipate," "estimate," "expected," "plan," or the like. All such forward-looking statements are expressly qualified by the cautionary statements described in this provision. Any forward-looking statement reflects only the beliefs of the Company or its management at the time the statement is made. Because all forward-looking statements deal with the future, they are subject to risks, uncertainties and developments which might cause a

Financial Statements and Exhibits

Financial Statements and Exhibits. (d) Exhibits . EXHIBIT INDEX Exhibit No. Description 99.1* Press Release dated January 16, 2024 99.2* Restructuring Plan Presentation Materials 101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document) 101.SCH** Inline XBRL Taxonomy Extension Schema 101.LAB** Inline XBRL Taxonomy Extension Label Linkbase 101.PRE** Inline XBRL Taxonomy Extension Presentation Linkbase 104 Cover Page Interactive Data File (embedded within the inline XBRL document contained in Exhibit 101) * Denotes furnished herewith. ** Denotes filed herewith. 5

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. LEGGETT & PLATT, INCORPORATED Date: January 16, 2024 By: /s/ JENNIFER J. DAVIS Jennifer J. Davis Executive Vice President – General Counsel 6

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