Briggs & Stratton Increases Quarterly Dividend by 4%
Gasoline Engine Maker’s Quarterly Profit Falls
New York, NY — Briggs & Stratton Corporation (NYSE:BGG) said its board has approved a four percent increase in its quarterly dividend, as the world’s largest producer of gasoline engines for outdoor power equipment posted a profit for the fourth quarter that was lower than analysts’ estimate.
The company declared a $0.14-per-share dividend on the common stock in the quarter ended June 30, up from $0.135 per share the prior quarter.
“This is our third dividend increase in three years, which demonstrates confidence in our strategy,” Chief Executive Officer Todd Teske said in the statement. “We remain committed to creating shareholder value via a balanced and disciplined approach to capital allocation.” (Source: “Briggs & Stratton Declares Dividend,” PR Newswire, August 17, 2016.)
Briggs & Stratton, headquartered in Milwaukee, Wisconsin, is the world’s largest producer of gasoline engines for outdoor power equipment. Its wholly owned subsidiaries also market pressure washers and make products for power generation, lawn and garden, turf care, and job sites.
BGG shares were down more than 11% in the pre-market trade after rising 19% over the past year.
The company said its fourth-quarter adjusted earnings per share were down 10% to $0.46 per share. Analysts’ consensus estimate for the fourth quarter was $0.54 a share, according to a Reuters forecast. Fourth-quarter net sales fell six percent to $502 million as cooler-than-normal spring weather in North America and Europe reduced orders. (Source: Ibid.)
Net sales for the fiscal year 2016 dropped 3.4% to $1.81 billion due to a $25.0 million reduction in job site products sales and lower sales caused by cool spring weather in North America and Europe, as well as economic uncertainty in many international markets, including Europe, the statement added. (Source: “Briggs & Stratton Corporation Reports Fourth Quarter Results,” PR Newswire, August 17, 2016.)
“Our fiscal fourth quarter sales were impacted by cooler than normal temperatures in North America and Europe,” said Teske. “Industry shipments in April and May were down significantly when compared to last year as the cooler weather impacted retail sell through. We believe that retail sell through has improved in the latter part of June and into July in both regions such that elevated channel inventories at the end of our fiscal year are reducing to more normal levels.”
According to the statement, Briggs & Stratton repurchased $37.4 million in shares under the share repurchase program and paid $23.6 million in dividends to shareholders during fiscal 2016.
For the fiscal year 2017, the company estimates that sales will increase to a range of $1.84 billion to $1.89 billion, and that earnings per share will likely remain between $1.26 and $1.41 per share. (Source: Ibid.)