Leggett & Platt to record $60-75 million charge
January 21, 2014,
Carthage, Mo. - Components source Leggett & Platt said it will take a pretax charge of $60 million to $75 million in the fourth quarter related to a non-furniture part of its business, its Commercial Vehicle Products group.
The non-cash impairment charge reflects the fact that the values of certain assets of the CVP unit, mainly goodwill, have fallen below book values, the company said.
Earlier, Leggett said it was considering strategic alternatives for the unit, possibly a divestiture. The company said it now intends to focus on improving the operating performance and cost structure of the CVP business.
Earnings per share will be reduced by 28 to 35 cents because of the charge, the company said.
Officials said the lower value of the CVP assets reflects reduced market demand for the racks, shelving and cabinets used in telecom, cable and delivery vans.