Lennox Cuts 2018 Profit View

(RTTNews) - Lennox International Inc. (LII) said that it lowered its 2018 GAAP earnings per share from continuing operations guidance to a range of $8.11-$8.51 from the prior range of $8.38-$8.78, reflecting additional tornado impact in 2018 than prior guidance; The guidance to be a benefit in 2019 upon receipt of insurance proceeds.

"For 2018, we are raising the estimated business interruption impact from the tornado, which will reverse to a benefit in 2019 upon the receipt of insurance proceeds," said Chairman and CEO Todd Bluedorn.

"We are also rebalancing the expected tornado impact between the third and fourth quarters of 2018. We had guided that one-third of the impact would be in the third quarter and now expect that approximately 40% of the impact was in the third quarter. We had estimated two-thirds of the impact to come in the fourth quarter and now expect that approximately 60% of the impact will be in the fourth quarter. Third-quarter EPS was up 8% but was impacted by lost profits from the tornado of $0.52 per share, about $0.17 higher than estimated for the quarter," said Todd Bluedorn.

The company said it plan to repurchase $100 million of stock in the fourth quarter as it looks toward a strong close to 2018 and ahead to 2019.

The company updated 2018 guidance for adjusted earnings per share from continuing operations to $8.70-$9.10 from $8.90-$9.30, reflecting additional tornado impact in 2018 than prior guidance; to be a benefit in 2019 upon receipt of insurance proceeds. Analysts polled by Thomson Reuters expect the company to report earnings of $9.23 per share for fiscal year 2018. Analysts' estimates typically exclude special items.

The company reiterated 2018 guidance for GAAP revenue growth of 2-4% and adjusted revenue growth of 4-6%.

It reiterated stock repurchase guidance of $450 million in total for 2018, and reiterating guidance for the company's average diluted share count of approximately 41 million shares on a full-year basis.

The company's tornado references relate to the July 19 tornado damage at a Residential manufacturing facility in Iowa.