Briggs & Stratton Corp. (fka BGGSQ)

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Briggs & Stratton slips 15% on Q2 results miss and lowered FY20 guidance

Jan. 30, 2020

Akanksha Bakshi, SA News Editor

Briggs & Stratton (BGG -15.6%) reported Q2 revenue decline of 13.4% Y/Y, reflecting the expected impact of the timing of shipments of small engines to OEMs and lower storm-related sales.

Engines segment sales declined 19% Y/Y and Products segment sales declined 5% Y/Y.

Q2 Gross margin declined by 276 bps to 15.5%; and Adj. gross margin of 17.3% down by 130 bps.

Reported loss from operations of $10.15M, compared income of $8.34M a year ago.

Net cash used in operating activities YTD was $207.86M, compared to $216.03M a year ago.

Company says, given uncertainty around elevated channel inventory and ongoing global weather related challenges, they are forecasting slightly reduced financial results across segments. They also expect slightly higher consolidated interest expense associated with ABL credit facility compared to previous estimates.

FY20 Outlook, lowered: Net sales $1.83B – $1.97B (prior $1.91B – 1.97B); Adj. EPS $0.05 - $0.33 (prior $0.20 - $0.40); and Operating Margins 2.1% to 2.9% (prior 2.5% to 3%).

Previously: Briggs & Stratton EPS misses by $0.07, misses on revenue (Jan. 30)