The Toro Company Announces the Sale of its Australia-Based Residential Pope Products Business

Rhea-AI Summary

The Toro Company (NYSE: TTC) has announced the sale of its Australia-based residential Pope Products business to The AMES Company, a subsidiary of Griffon (NYSE: GFF). The sold assets, focused on garden watering and irrigation, were exclusively marketed in Australia and New Zealand. This divestiture aligns with Toro's strategy to concentrate on high-growth sectors such as golf, sports fields, and professional contractor markets. Financially, the sale's impact on Toro's fiscal 2024 results is negligible and was already factored into their previous forecasts.

Positive

• The sale aligns with Toro's strategy to focus on high-growth opportunities.
• Allows Toro to enhance focus on golf, sports fields, and professional contractor markets.

Negative

• The sale has negligible impact on Toro's fiscal 2024 financial results.

Insights

Financial Analyst

The sale of The Toro Company's Pope Products business to The AMES Company is a strategic decision aimed at focusing on more profitable growth areas. By divesting a non-core asset, Toro is streamlining its portfolio to concentrate on sectors like golf, sports fields, professional contractor and residential markets, which are more aligned with their long-term growth strategy. Prudent capital allocation and disciplined portfolio management are essential for maintaining a healthy balance sheet and ensuring resources are directed to the most promising ventures.

From a financial perspective, the transaction's impact on fiscal 2024 results is minimal and already factored into existing forecasts, indicating it won’t disrupt current financial expectations. This maneuver could potentially free up capital for reinvestment or debt reduction, both of which could positively affect shareholder value over time. Retail investors should view this as a prudent step towards focusing on more lucrative segments.

Strategically, this move aligns with industry trends where companies divest non-core assets to better compete in their primary markets. For instance, focusing on golf and sports fields, which are growing sectors, can provide higher margins and more stable revenue streams.

Reinforces focus on strategic priorities that provide the greatest profitable growth opportunities

BLOOMINGTON, Minn.--(BUSINESS WIRE)-- The Toro Company (NYSE: TTC), through its wholly-owned subsidiaries Toro Australia Pty Ltd and Toro Australia Group Sales Pty Ltd based in South Australia (collectively “Toro Australia”), today announced the sale of its Pope Products residential garden watering and irrigation business to The AMES Company, Inc., a subsidiary of Griffon Corporation (NYSE: GFF). Pope irrigation and garden watering products are sold exclusively in Australia and New Zealand.

This transaction represents The Toro Company’s commitment to disciplined portfolio management and prudent capital allocation strategies. The transaction also represents an opportunity for Toro Australia to enhance its focus on the best opportunities to drive long-term profitable growth in the golf, sports fields and grounds, professional contractor, rental and residential markets. The financial results related to the Pope Products business have historically been included in the company’s residential segment results. The impact of this divestiture is immaterial to the company’s fiscal 2024 financial results and was already considered in the previously shared outlook for the third quarter and full-year.

About Toro Australia and Pope Products

Toro Australia, a subsidiary of The Toro Company, is a provider of innovative outdoor solutions for the golf, sports fields and grounds, landscape contractor, construction, residential and agricultural markets across Australia and New Zealand. Founded in 1925, the Pope Products brand represents a broad range of garden watering and irrigation products to help residential customers create and maintain beautiful gardens. Learn more at: www.toro.com.au.

About The Toro Company

The Toro Company (NYSE: TTC) is a leading worldwide provider of innovative solutions for the outdoor environment including turf and landscape maintenance, snow and ice management, underground utility construction, rental and specialty construction, and irrigation and outdoor lighting solutions. With net sales of $4.55 billion in fiscal 2023, The Toro Company’s global presence extends to more than 125 countries through a portfolio of brands that includes Toro, Ditch Witch, Exmark, Spartan, BOSS, Ventrac, American Augers, Trencor, Subsite, HammerHead, Radius, Perrot, Hayter, Unique Lighting Systems, Irritrol, and Lawn-Boy. Through constant innovation and caring relationships build on trust and integrity, The Toro Company and its brands have built a legacy of excellence by helping customers work on golf courses, sports fields, construction sites, public green spaces, commercial and residential properties and agricultural operations. For more information, visit www.thetorocompany.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240701105142/en/

Investor Relations

Jeremy Steffan

Director, Investor Relations

(952) 887-7962, jeremy.steffan@toro.com

Media Relations

Branden Happel

Senior Manager, Public Relations

(952) 887-8930, branden.happel@toro.com

Source: The Toro Company

FAQ

What business did The Toro Company sell in Australia?

The Toro Company sold its Pope Products residential garden watering and irrigation business in Australia.

Who acquired Toro's Pope Products business?

The AMES Company, a subsidiary of Griffon (NYSE: GFF), acquired Toro's Pope Products business.

What is the impact of the Pope Products sale on Toro's financial results?

The impact of the sale on Toro's fiscal 2024 financial results is negligible and was already factored into their previous forecasts.

Why did The Toro Company sell its Pope Products business?

The Toro Company sold its Pope Products business to focus on higher-growth sectors such as golf, sports fields, and professional contractor markets.

Where were Pope Products sold before being acquired by The AMES Company?

Pope Products were sold exclusively in Australia and New Zealand.