10:30 AM EST, 12/18/2024 (MT Newswires) -- Toro (TTC) on Wednesday laid out a fiscal 2025 bottom-line outlook that fell short of analysts' estimates as the company's fourth-quarter sales came in lower than expected while earnings met market projections.

The lawn mowers and golf equipment manufacturer anticipates adjusted earnings to be in a range of $4.25 to $4.40 per share for fiscal 2025. The current consensus on FactSet is for non-GAAP EPS of $4.58. For the fiscal year ended Oct. 31, Toro's adjusted EPS ticked down 1% to $4.17.

Sales are set to be flat to up 1% for the ongoing fiscal year, while the Street is looking for revenue of $4.78 billion. The company's sales rose to $4.58 billion in fiscal 2024 from $4.55 billion a year ago. The stock dropped 3.6% in Wednesday trade.

Toro continues to have "elevated order backlog" for its underground construction, and golf and grounds businesses, Chief Executive Richard Olson said in a statement. Field inventories in the lawn care and snow ice management operations remain "higher than ideal," though the company expects to be better positioned versus the previous year heading into the upcoming turf season, Olson said.

For the three months through October, Toro's adjusted earnings jumped 34% year over year to $0.95 a share, in line with the consensus view. Sales rose 9% to $1.08 billion, just shy of analysts' $1.09 billion estimate.

"In the fourth quarter, we enhanced productivity and carefully controlled expenses," Olson said. "This helped offset the impact of a higher proportion of lower-margin products in our net sales than we anticipated, and enabled us to achieve adjusted diluted EPS in line with our expectations."

Professional segment sales climbed 10% to $913.9 million, boosted by golf and grounds products and underground construction equipment, as well as net price realization. Residential sales increased 4.5% to $155.1 million mainly due to shipments of lawn care products, partially offset by lower shipments of snow products and sales promotions.

Gross margin deteriorated to 32.4% from 33.5% in the prior-year period, weighed down by higher material, freight and manufacturing costs, according to Toro.

Price: 82.88, Change: -2.43, Percent Change: -2.85