Toro Co Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: David MacGregor - Longbow Research - Analyst : I want to start by just asking about AMP. And clearly, there's a very good level of progress being made here. But I just want to be clear around kind of the movement, some of the numbers here. You talked about $64 million run rate in cost savings to date. $50 million of that occurred in the first quarter which is up to a great start. I guess how much of this reached the bottom line in the first quarter, if any at all? You talked about trying to redirect a portion of that into investment. Some portion of it falls to the bottom line. Try to help us understand just how much of that might have benefited 1Q. And then just the cadence on these AMP benefits and the drop to earnings over the remaining three quarters of '25 would be really helpful.

Question: David MacGregor - Longbow Research - Analyst : And just to be clear on the numbers here. When you talk about the $49 million run rate and $7 million of gross realized savings, are you suggesting that it was $42 million in expenses and the gross difference is the $7 million? I just want to be clear on the math.

Question: David MacGregor - Longbow Research - Analyst : It's a run rate. And then secondly, can you just talk about pro snow? I know in the residential snow, you talked about volumes were down in the inventory dynamic in the channel. But on the pro side with BOSS, where are dealer inventories here? And how should we read through to landscape contractor in the season ahead given everything we're hearing through our channel checks are that these guys have a pretty good plow season, which puts cash in their pocket. And there's obviously been deferred spending in LCE. So just trying to think through the read from pro snow in this quarter to what ZTR pro grade ZTR could look like this summer.

Question: David MacGregor - Longbow Research - Analyst : Just last question for me. It'd be interesting to get your updated price/cost expectations for this year. You talked about raw materials being a bad guy in the first quarter. Just how you think about the price/cost spread here through the balance of the year?

Question: Timothy Wojs - Robert W. Baird & Co., Inc. - Analyst : Maybe just the first question on some of the moving pieces on tariffs. Could you just remind us kind of how much of your COGS are related to kind of Mexico manufacturing and China supply chain? And then is there -- how big is Canada and I guess do you produce in Canada or do you produce in the US? Just if you could run through a couple of those kind of exposure related kind of items, I think that'd be helpful.

Question: Timothy Wojs - Robert W. Baird & Co., Inc. - Analyst : And I get it, like if the current -- so if tariffs on China are 20% -- the incremental about 10% on China and then the 25% on Canada and Mexico, it does stay intact. Is there a ballpark figure in terms of what the gross impact would would be for Toro in those situations?

Question: Timothy Wojs - Robert W. Baird & Co., Inc. - Analyst : On the field channel inventory, just in kind of the pro kind of grounds business, landscape contractor business. Rick, like where are you relative to normal at this point in kind of the year? And I guess what's the sentiment like when you talk to your distributor and dealers just around expectations for sales and just how much kind of inventory they're kind of willing to kind of hold?

Question: Timothy Wojs - Robert W. Baird & Co., Inc. - Analyst : And then just the last one. On underground, I mean it's been mentioned as a growth driver for the past several quarters. I guess it wasn't kind of mentioned as one in pro this quarter. So just given what you just said about the fact that field inventory could be higher there. And I assume there was still a backlog there. Is it a timing issue there just trying to understand kind of what happened with the underground business in the quarter.

Question: Ted Jackson - Northland Securities - Analyst : Actually I had three questions to ask and two of them have been hit, but I do have a kind of a nuanced one on going back in the tariffs. With regards -- so I know it's your favorite topic, right. But with regards to, going back, you said you didn't have anything with retaliatory tariffs, but is there -- how much -- two parts. One is, how -- is there any -- how much product do you actually make here in the states that actually is exported that could come at risk if there were retaliatory tariffs? And then going back into kind of the Mexico and the products that you make there, how hard would it be for you to shift production and bring some of that stuff into the US? Is it something that you would think would be worthwhile to do or is it the kind of thing where you just have to deal with the tariffs and that's it? That'd be basically my question for you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 06, 2025 / 4:00PM, TTC.N - Q1 2025 Toro Co Earnings Call

Question: Ted Jackson - Northland Securities - Analyst : And then actually can I ask just quickly. Like what was -- what would have been like, how much was Pope in the last quarter just to kind of get a sense in terms of the dynamic with its impact on kind of the year over year for you? And then I'm done.