A Collection of Current Outdoor Power Equipment (OPE) Industry Related News Articles From OPEESA's (Outdoor Power Equipment and Engine Service Association) Newsletter "OPE-In-The-Know," the Business of OPE.
Sonoma, CA – July 5 -- It’s a polarizing device that pits neighbor against neighbor.
For some, it frays irritated nerves, disrupts their serenity and ought to be banned. To others, it’s a highly efficient, cost-effective tool.
“It’s one of those things that’s worthy of having controversy about,” said June King, owner of Landmark Landscape Co. in Sonoma.
“There are all kinds of different opinions about them — and they’re all valid. How do you do the job without them? And yeah, they’re noisy.”
Leaf blowers are essential for her business, King said, but she’d just as soon have them muffled.
Dave Waldron of Waldron Landscaping said he isn’t necessarily opposed to a ban as long as it applies equally to all landscapers.
“We would use brooms probably,” Waldron said. “(Leaf blowers) make the job cheaper for people. They can get the job done faster; it takes a lot longer to use a broom.”
Sonoma’s City Council on Wednesday is set to discuss whether to proceed with an ordinance that would restrict, or perhaps ban, the power landscaping tools.
The issue pops up from time to time, some might say like a dandelion or crabgrass, in Sonoma County communities. But so far, none has gone so far as to legislate leaf blowers beyond standard noise restrictions.
Some Sebastopol residents pushed the issue as far as the City Council last year, but the issue was put off until the fall.
Sonoma resident Lisa Summers’ research on potential health and environmental risks of leaf blowers caught the attention of councilmembers Ken Brown and Joanne Sanders, who asked that the issue be addressed by the full council.
The result, City Manager Linda Kelly said, could be to write an ordinance banning or restricting leaf blowers in the city. Or the issue could be sent to a committee that studies environmental concerns within the city.
A ban on the use of leaf blowers, if applied to city properties, could increase costs, Kelly warned, because of the extra time needed to clean walkways and parks of leaves and other debris that can become hazards or block storm drains.
If Sonoma votes to ban leaf blowers, it will join the ranks of about 20 other California cities to have done so, including Belvedere, Beverly Hills, Carmel, Del Mar, Malibu, Santa Monica, Mill Valley, Berkeley and Palo Alto.
Other cities restrict their hours of operation, or allow only electric or battery-powered blowers.
Kris Kiser, an executive vice president of the Outdoor Power Equipment Institute in Virginia, said his trade group understands the tools can be irritating.
“It bothers people. We recognize that,” he said. “It’s a challenge because they’ve become ubiquitous. Millions of units sell every year because they’re very efficient. They work very well for what they’re designed for.”
The trend is toward quieter blowers, he said. Most newer machines operate at 65 decibels or lower, which is quieter than most lawn mowers and chainsaws, he said.
Sonoma’s noise ordinance prohibits the use of “residential power equipment” before 8 a.m., later on weekends and holidays, and every day after 6 p.m. Noise limits are set at 90 decibels.
Often, though, Kiser acknowledged, it’s the pitch of the blowers more than the volume.
Summers, who submitted a letter seeking an outright ban in a 22-page packet sent to the City Council, said she has lived in Sonoma for 13 years.
“During the countless hours I’ve spent at city parks with my four children, nothing in my mind stands out as a more constant and insidious disruption to the quality of life in the valley than the ever-increasing use of leaf blowers,” she wrote.
For years, she said, she has seen city maintenance workers use leaf blowers “in close proximity to playgrounds where young children and babies play without the ear protection the workers wear.”
And, she argues, leaf blowers cause air pollution and health problems.
“Leaf blowers are associated with a wide range of impacts to human health and the environment, including but not limited to respiratory illness and distress, air pollution from unburned fuel, redistribution of pesticides, herbicides, fertilizers, dust particles and animal feces into the air we breathe,” she wrote.
A study issued in 2000 by the California Air Resources Board in response to questions from the Legislature was inconclusive regarding potential health and environmental impacts.
Developed in the early 1970s, the leaf blower became popular in California when water was banned for many garden clean-up tasks because of drought concerns, the report noted. In 1998, nearly 2 million of the tools were sold nationwide.
“Health effects from hazards identified as being generated by leaf blowers range from mild to serious, but the appearance of those effects depends on exposures: the dose, or how much of the hazard is received by a person and the exposure time,” the report said.
King said in her nearly 30 years as a landscape company owner, “none of my clients have ever asked me not to use one.”
“As with anything, common sense is a guideline that I encourage my guys to use,” she said. “Our guys are supposed to be conscientious. If someone’s having a party, don’t use it.”
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (issued June 4, 2010)
Nature of Operations
The Toro Company is in the business of designing, manufacturing, and marketing professional turf maintenance equipment and services, turf and agricultural micro-irrigation systems, landscaping equipment, and residential yard and snow removal products.
We sell our products through a network of distributors, dealers, hardware retailers, home centers, mass retailers, and over the Internet.
Our businesses are organized into three reportable business segments: professional, residential, and distribution. Our distribution segment, which consists of our company-owned domestic distribution company, has been combined with our corporate activities. Our emphasis is to provide innovative, well-built, and dependable products supported by an extensive service network. A significant portion of our revenues has historically been, and we expect it to continue to be, attributable to new and enhanced products.
RESULTS OF OPERATIONS
Overview
Our results for the second quarter of fiscal 2010 were generally positive with a net sales growth rate of 12.6 percent and a net earnings growth rate of 23.9 percent compared to the second quarter of fiscal 2009. Year-to-date net earnings increased 29.8 percent in fiscal 2010 compared to the same period in the last fiscal year on a year-to-date sales growth rate of 6.4 percent.
Shipments of most professional segment products were up primarily from improved economic conditions, increased demand for our products, the successful introduction of new products, and customers who aligned their orders closer to retail demand. Net sales of micro-irrigation products continued to gain momentum with our investment in addition manufacturing capacity to increase production of our water conserving products to meet the growing worldwide market demand. Residential segment net sales also increased due to favorable weather conditions, as well as increased demand and additional product placement for riding products. In addition, shipments of snow thrower products were up for the second quarter and year-to-date period of fiscal 2010 compared to the same periods in the prior fiscal year due to increased demand from heavy snow falls during the winter season of 2009-2010 and the timing of the introduction of our new redesigned offering of snow thrower products that shipped to customers in the first quarter of fiscal 2010.
Net earnings as a percentage of net sales rose to 8.1 percent and 6.3 percent in the second quarter and year-to-date period of fiscal 2010, respectively, compared to 7.4 percent and 5.2 percent in the second quarter and year-to-date period of fiscal 2009, respectively. Higher gross margins, leveraging of selling, general, and administrative expenses, and a lower effective tax rate also contributed to the earnings improvement.
We continued to focus on reducing working capital and improving asset management. As a result of our efforts, as of the end of our fiscal 2010 second quarter we achieved our long-term goal to reduce average net working capital (accounts receivable plus inventory less trade payables) as a percentage of net sales to below 20 percent, or “in the teens.” Our average net working capital as a percentage of net sales for the twelve months ended April 30, 2010 was 19.0 percent. The impact of our efforts to reduce working capital resulted in a significant improvement of our cash flows from operating activities for the first six months of fiscal 2010 compared to the first six months of fiscal 2009. We also paid a cash dividend of $0.18 per share during the second quarter of fiscal 2010, which was an increase of 20 percent over our cash dividend of $0.15 per share for the second quarter of fiscal 2009.
Our fiscal 2010 second quarter financial results were positive, and we are generally optimistic that the positive momentum from our second quarter should continue through the remainder of fiscal 2010. We are off to a good start with our new one-year initiative, “5 in One: Back on Course,” which is intended to guide us through this year of anticipated recovery with an even stronger focus on the customer and a single financial goal: five percent profit after tax as a percentage of net sales for fiscal 2010.
We believe we have taken the necessary proactive measures through our continued focus on asset management, reductions to our cost structure, and our commitment to product innovation, to position us well to benefit if our markets continue to improve. We will continue to keep a cautionary eye on the global economies, and particularly Europe, retail demand, field inventory levels, commodity prices, weather, competitive actions, and other factors identified below under the heading “Forward-Looking Information,” which could cause our actual results to differ from our outlook.
Net Sales
Worldwide consolidated net sales for the second quarter and year-to-date periods of fiscal 2010 were up 12.6 percent and 6.4 percent, respectively, from the same periods in the prior fiscal year. Worldwide professional segment net sales were up 12.6 percent and 4.2 percent for the second quarter and year-to-date periods of fiscal 2010, respectively, compared to the same periods in the prior fiscal year.
Shipments of most professional segment products were up as a result of improved economic conditions, the successful introduction of new products, and customers who aligned their orders closer to retail demand, all of which resulted in increased demand for our products.
Retail sales increased for the second quarter and year-to-date periods of fiscal 2010 compared to the same periods in fiscal 2009, mainly as the result of increased retail demand for landscape contractor equipment. Professional segment field inventory levels were down as of the end of the second quarter of fiscal 2010 compared to the end of the second quarter of fiscal 2009. Net sales of micro-irrigation products were up due to our investments in additional manufacturing capacity that increased production of our water conserving products to meet the growing worldwide market demand.
Residential segment net sales increased 14.5 percent and 12.5 percent for the second quarter and year-to-date periods of fiscal 2010, respectively, compared to the same periods in fiscal 2009 as a result of favorable weather conditions, increased demand and additional product placement for riding products, and the introduction of our new cordless electric walk power mower. In addition, shipments of snow thrower products were up for the second quarter and year-to-date periods of fiscal 2010 compared to the same periods in the prior fiscal year due to increased demand from heavy snow falls during the winter season of 2009-2010 and the timing of the introduction of our new redesigned offering of snow thrower products that shipped to customers in the first quarter of fiscal 2010.
Net sales of Pope irrigation products sold in Australia also increased for the year-to-date period of fiscal 2010 compared to the year-to-date period of fiscal 2009 as a result of dry weather conditions in that region. International net sales for the second quarter and year-to-date periods of fiscal 2010 increased 13.5 percent and 6.5 percent, respectively, from the same periods in the prior fiscal year due in part to a weaker U.S. dollar compared to other currencies in which we transact business that accounted for approximately $4.7 million and $14.2 million of additional net sales for the second quarter and year-to-date periods of fiscal 2010, respectively.
Gross Profit
As a percentage of net sales, gross profit for the second quarter of fiscal 2010 increased to 33.3 percent compared to 32.3 percent in the second quarter of fiscal 2009. Gross profit as a percent of net sales for the year-to-date period of fiscal 2010 also increased to 34.0 percent compared to 33.3 percent for year-to-date period of fiscal 2009.
These improvements were due to the following factors: (i) lower average commodity costs in the first half of fiscal 2010 compared to the first half of fiscal 2009, primarily from lower steel and aluminum costs; (ii) lower manufacturing costs from increased plant utilization due to increased demand for our products; (iii) a weaker U.S. dollar compared to other currencies in which we transact business; and (iv) resulting effects from cost reduction efforts implemented in fiscal 2009. Somewhat offsetting those positive factors was an increase in freight expense.
Selling, General, and Administrative Expense
SG and A expense increased $13.1 million, or 12.8 percent, for the second quarter of fiscal 2010 compared to the second quarter of fiscal 2009 due to an increase in employee incentive compensation expense, but was even as a percentage of net sales at 20.5 percent as compared to the second quarter of fiscal 2009. SG and A expense increased $5.1 million, or 2.5 percent for the year-to-date period of fiscal 2010 compared to the year-to-date period of fiscal 2009. SG and A expense as a percentage of net sales for the year-to-date period of fiscal 2010 decreased to 23.7 percent compared to 24.6 percent for the year-to-date period of fiscal 2009.
This decrease was primarily attributable to our leaner cost structure resulting from cost reduction efforts taken in fiscal 2009, costs incurred in fiscal 2009 for workforce adjustments of $2.1 million that were not duplicated in fiscal 2010, and a decrease in bad debt expense of $1.1 million. Somewhat offsetting those decreases was an increase in employee incentive compensation expense of $9.0 million from anticipated improved financial performance in fiscal 2010, as compared to fiscal 2009.
Interest Expense
Interest expense for the second quarter and year-to-date periods of fiscal 2010 decreased 3.4 percent and 3.0 percent, respectively, compared to the same periods in the prior fiscal year as a result of lower average debt levels.
Other Income, Net
Other income, net for the second quarter and year-to-date periods of fiscal 2010 decreased $0.6 million and $0.5 million, respectively, compared to the same periods in the prior fiscal year. These decreases were due to lower foreign currency exchange rate gains, a decrease in finance charge revenue, somewhat offset by income from our investment in Red Iron.
Provision for Income Taxes
The effective tax rate for the second quarter and year-to-date period of fiscal 2010 was 33.6 percent compared to 34.2 percent for the same periods in fiscal 2009. The decrease in the effective tax rate was primarily the result of a valuation allowance for foreign net operating losses and provision adjustments in fiscal 2009, somewhat offset by the expiration of the domestic research tax credit.
BUSINESS SEGMENTS
As described previously, we operate in three reportable business segments: professional, residential, and distribution. Our distribution segment, which consists of our wholly owned domestic distribution company, has been combined with our corporate activities that is shown as “Other” in the following tables. Operating earnings for our professional and residential segments are defined as earnings from operations plus other income, net. Operating loss for “Other” includes earnings (loss) from operations, corporate activities, other income, net, and interest expense.
Professional
Net Sales. Worldwide net sales for the professional segment in the second quarter and year-to-date periods of fiscal 2010 increased 12.6 percent and 4.2 percent, respectively, compared to the same periods in the last fiscal year. Shipments of most professional segment products were up as a result of improved economic conditions, increased demand for our products, the successful introduction of new products, and customers who aligned their orders closer to retail demand.
Retail sales increased for the second quarter and year-to-date periods of fiscal 2010 compared to the same periods in fiscal 2009, mainly as the result of increased retail demand for landscape contractor equipment. Professional segment field inventory levels were down as of the end of the second quarter of fiscal 2010 compared to the end of the second quarter of fiscal 2009. Net sales of micro-irrigation products were up due to our investments in additional manufacturing capacity that increased production of our water conserving products to meet the growing worldwide market demand.
Operating Earnings. Operating earnings for the professional segment in the second quarter and year-to-date periods of fiscal 2010 increased 18.9 percent and 7.4 percent, respectively, compared to the same periods in the last fiscal year. Expressed as a percentage of net sales, professional segment operating margin increased to 19.3 percent compared to 18.3 percent in the second quarter of fiscal 2009, and fiscal 2010 year-to-date professional segment operating margin also increased to 16.6 percent compared to 16.1 percent from the same period in the last fiscal year.
These profit improvements were primarily attributable to higher gross margins due to the same factors discussed previously in the Gross Profit section. In addition, a decline in SG&A expense as a percentage of net sales also contributed to the operating earnings improvement, which was due mainly to leveraging SG&A costs over higher sales volumes.
Residential
Net Sales. Worldwide net sales for the residential segment in the second quarter and year-to-date periods of fiscal 2010 increased 14.5 percent and 12.5 percent, respectively, compared to the same periods in the last fiscal year. These sales increases were due mainly to favorable weather conditions, additional product placement for riding products, and the introduction of our new cordless electric walk power mower, all of which contributed to an increase in demand for our products.
In addition, shipments of snow thrower products were up for the second quarter and year-to-date period of fiscal 2010 compared to the same periods in the prior fiscal year due to increased demand from heavy snow falls during the winter season of 2009-2010 and the timing of the introduction of our new redesigned offering of snow thrower products that shipped to customers in the first quarter of fiscal 2010. Net sales of Pope irrigation products sold in Australia also increased for the year-to-date period of fiscal 2010 compared to the year-to-date period of fiscal 2009 as a result of dry weather conditions in that region.
Operating Earnings. Operating earnings for the residential segment in the second quarter and year-to-date periods of fiscal 2010 increased 51.5 percent and 79.9 percent, respectively, compared to the same periods in the last fiscal year. Expressed as a percentage of net sales, residential segment operating margin increased to 12.0 percent compared to 9.0 percent in the second quarter of fiscal 2009, and fiscal 2010 year-to-date residential segment operating margin increased to 11.8 percent compared to 7.4 percent last fiscal year. These profit improvements were due to higher gross margins primarily from lower average commodity costs in the first half of fiscal 2010 compared to the first half of fiscal 2009, a weaker U.S. dollar compared to other currencies in which we transact business, resulting effects of cost reduction efforts implemented in fiscal 2009, and increased sales volumes of higher-margin products. Somewhat offsetting the profit improvements were higher freight expense and an increase in SG and A expense.
Other
Net Sales. Net sales for the other segment include sales from our wholly owned domestic distribution company less sales from the professional and residential segments to that distribution company. In fiscal 2009, “Other” also included elimination of the professional and residential segments’ floor plan interest costs from Toro Credit Company (TCC), our wholly owned financing company. With the establishment of Red Iron, net sales for the “Other” segment no longer includes corporate financing activities, including the elimination of floor plan costs from TCC, which results in lower net sales for the other segment. Net sales for the “Other” segment were down for the second quarter and year-to-date periods of fiscal 2010 compared to the same periods in the last fiscal year by $2.8 million, or 46.9 percent, and $4.8 million, or 49.0 percent, respectively, as a result of the elimination of TCC floor plan interest costs, as well as lower net sales at our wholly owned distributorship.
Operating Losses. Operating losses for the other segment were up for the second quarter and year-to-date periods of fiscal 2010 by $6.6 million, or 37.8 percent, and $4.5 million, or 10.8 percent, respectively, compared to the same periods in the last fiscal year. These loss increases were primarily attributable to an increase in employee incentive compensation expense due to anticipated improved financial performance in fiscal 2010, as compared to fiscal 2009, lower foreign currency exchange rate gains, and the elimination of TCC floor plan interest costs, as described above. Somewhat offsetting those factors was overall reduced spending from our leaner cost structure as a result of actions we implemented in fiscal 2009, as well as elimination of costs incurred in fiscal 2009 for workforce adjustments.
June 14--Linda and Bob Thayer of Wellington, Ohio, recently invested in a sporty new set of wheels. It boasts a premium engine, high-backed ergonomic seating and all-wheel steering that can turn the vehicle on a dime.
It also cuts the grass.
They're part of a new trend fueling green envy in America: the rise of the tricked-out lawn mower. Today, speedier cutting technology is practically de rigueur. Mower makers are now focused on mimicking the auto industry with cosmetic and creature comforts. Sun shades, iPod compartments, cruise control, chrome hub caps and even alternative fuels are all part of the mower mania.
Cutting-edge designs start at around $3,000 and go for more than $10,000—or roughly the cost of a 2010 Nissan Versa.
Hustler Turf Equipment offers the $10,000-plus commercial "Super Z" mower, which can jet along at 15 mph and has enough mechanical brawn to cut grass 40 hours a week. The price tag hasn't deterred residential customers, who "simply want the biggest, baddest mower on the block," says marketing director Adam Mullet.
Tim Strong of Raleigh, N.C., recently paid $4,000 for a commercial-grade reel mower from Locke, a brand once used in Yankee Stadium. It lends a striped appearance to his lawn by bending blades in alternate directions as he mows. It's also attention-getting. One neighbor marveled, "That's a pretty big-sized machine you've got there." Mr. Strong says that no other machine will give him the scissor-like precision-cut he wants for his Zoysia grass, a cushiony turf common on the golf links. "Quite frankly, I think your lawn and how you maintain it sends a message about how you treat other things you own and who you are," he says.
Despite environmentalists' ongoing campaign to peg grass as water-wasting turf, homeowners are snapping up high-end riding mowers with an appetite not seen since before the recession. After double-digit decreases for the past two years, U.S. shipments of riders are expected to climb slightly more than 6% over the next two years, according to the Outdoor Power Equipment Institute.
For some buyers, the new mower mood is a reaction to the economy. As tight credit, unemployment woes and lower home resale values persist, more people are staying put and improving existing dwellings—as well as investing in higher-end equipment to care for it.
For others, a mower upgrade is tinged with a little neighborly competition. "Most of us are guilty of trying to get the yard to look better than our neighbors. That goes right along with equipment having to be cooler than the neighbors," says Jim Bednar, a senior marketing manager for MTD Products Inc.'s Cub Cadet brand. Last year, Cub Cadet added an iPod holder with earphone slot into its lawn tractors. "It's well beyond cupholders," Mr. Bednar says.
To a large extent, there is pent-up demand after a several-year dry spell where consumers belt-tightened and repaired old equipment. Now that they are ready to buy, they are often buying big—especially the pricier "zero-turn" riders, which can make super-tight rotations around trees or flower beds, often cutting mowing time in half.
"Like people buying SUVs, they may be buying more mower than is technically necessary but that will give them a greater degree of comfort," says Kris Kiser, the institute's executive vice president.
The current appetite for high-end mowers is slightly counterintuitive. Some environmentalists and health advocates have been pushing homeowners to decrease pesticide and water usage by dialing back their lawn size. A growing number of towns and utilities offer financial incentives for such moves.
"Everyone is trending toward less turf, even on bigger estates," says Margie Grace, owner of Grace Design Associates, a landscape design and building firm in Santa Barbara, Calif. She calls it "waking from our lawn coma."
Some towns are beefing up noise ordinances for outdoor power equipment. "It's all leading to less grass possibly," says Greg Weekes, a marketing manager for Deere & Co., owner of the John Deere brand.
Still, Deere says it is seeing a 2010 mower sale uptick that is "far exceeding" forecasts, Mr. Weekes says. The company is currently experimenting with robotic technology for use in future models, while others such as Cub Cadet and Ariens Co. now sell riding mowers running on propane or batteries.
At Home Depot Inc., riding mower sales growth is up low double-digits through April with higher-end products performing best. Sears Holdings Corp., for its part, now runs "Demo Days" at its namesake stores so customers can test-drive mowers. The company is painting its Craftsman brand units in sports-car colors like hot red, yellow and jet black.
Less expensive walk-behind mowers are still the biggest sellers in the U.S. But among those upgrading to riders, and in particular zero-turns, are the 76 million Baby Boomers who are eyeing retirement and crave a less taxing yard routine.
Ms. Thayer of Ohio, a 52-year-old high school administrator who is retiring next year, convinced her husband to buy a $4,200 Cub Cadet "Z-Force S" zero-turn unit because it boasted so many accoutrements—including a car-like steering wheel versus the lap bars used on most zero-turns. "When I cut my grass it shouldn't be uncomfortable," she says.
Similarly, 62-year-old Skip Bilbey plunked down $12,000 to buy a Gravely 260 diesel zero-turn mower with a 60-inch cutting width, and he now grooms five acres in just a few hours, or half the time of his old rider.
His dealer, Howard Welsh at Gambles lawn and garden equipment in Alpena, Mich., has a simple explanation for the uber-mower movement. "People are stressed out and wore out from working way too many hours," he says. Customers "don't live to cut grass."
June 10 -- Over the past 20 years, Beatrice was known as “Lawnmower City.”
The moniker described the lawnmower and turf care equipment manufacturing town, with Husqvarna Turf Care, Encore Manufacturing and Exmark Manufacturing employing more than 600 employees.
After Husqvarna announced it would be consolidating local operations into a million square foot, 2,500 employee plant in Orangeburg, S.C., “Lawnmower City” has effectively been cut in half.
Looking to the future, however, city and economic development officials say that Beatrice’s economy can’t remain a “one-trick pony” for much longer without potential permanent damage done to the community.
Beatrice Mayor Dennis Schuster said the community will need to look at diversifying its economy when negotiating with potential industries to fill the vacant Husqvarna building at the end of this year.
“Over the years, manufacturing has dwindled as far as employment,” Schuster said. In 1950, he said, half of the working population was employed by manufacturing jobs. Today, that number is 10-12 percent of the population.
“We make more goods with 10 percent of the population than we did with 50 percent” Schuster said. “There just isn’t the jobs available that there used to be.”
Schuster said many citizens see manufacturing as a “good, steady job that provided benefits and good, stable income.”
But Schuster said with the closing of Husqvarna, Beatrice needs to exercise options to attract industries that will look at staying and growing in the southeast Nebraska region.
“We need to look at all types of manufacturing,” he said. “We have a lot of no-skill, low-skill assembly type jobs in Beatrice. There are higher skilled jobs available out there.”
Diversifying the economy is not a new concept to Schuster, who said he has been urging the local economy to diversify for the better part of a decade.
“It’s imperative for our survival that we diversify here,” he said. “We can’t continue to depend on manufacturing like we have. If we don’t, Beatrice will continue to shrink and fail as a community.”
John DeHardt, managing principal of the Husqvarna building with Kessinger Hunter in Kansas City, Mo., said a building like Husqvarna’s typically holds two types of industry: manufacturing and distribution.
According to DeHardt and Gage County Economic Development director Terri Dageford, while a distribution warehouse set up in the Husqvarna building would provide jobs, numbers would be down significantly from the 230 permanent and over 100 temporary jobs at Husqvarna.
“Manufacturers naturally have more jobs and is more labor intensive,” DeHardt said. A distribution warehouse would employ as many as 30, he estimates.
Also, DeHardt said a study of distribution routes across the country might indicate Beatrice to be a less-than-ideal location for a large-scale distribution industry.
BEATRICE -- May 28 -- With 44 years of experience in the lawnmower industry, Dick Tegtmeier understands the ties the industry has to the town of Beatrice and what severing some of those ties can mean.
Upon hearing that Husqvarna Turf Care, which employs more than 300 people, will be consolidating operations from Beatrice to Orangeburg, S.C., Tegtmeier realized the effects the move will have on the community.
“I’ve seen a lot of things come and go, but this probably baffles my mind about as much as anything,” Tegtmeier said Thursday. “I’m really shocked and surprised. In a downturn like this, it’s really going to effect (the community) worse than normal.
“That’s more than a community can stand normally. Especially in down times.”
Tegtmeier co-founded Exmark Manufacturing with three others in 1982. Then in 1988, he opened his own mower company, Encore Manufacturing, which still operates today.
Tegtmeier thinks that Husqvarna’s transition was probably unavoidable once the company made up its mind to move.
“When a company makes up its mind to do something, probably hell nor high water is going to keep it from doing it,” Tegtmeier said.
Tegtmeier thinks it’s unusual for the business to move because of the massive building recently built in Beatrice.
He expects that Husqvarna will be able to pay off the building’s lease once the business moves.
Current Husqvarna employees may consider walking out on the company to find a replacement job before the company moves, in an attempt to beat other employees to the punch, Tegtmeier pointed out.
“I think there will probably be a lot of people leaving there to get into the job market before December when everybody will be out there,” Tegtmeier explained. “That could have adverse effects on them immediately. It’s unfortunate.”
BRILLION — May 30 -- Ariens Co. announced changes to its executive management structure.
Jeff Hebbard was named president of Ariens Co. Wholegoods Business. Hebbard previously held the position of senior vice president sales, marketing and product development. He will be responsible for all current brands of Ariens, Gravely, EverRide and Great Dane; recent acquisitions of Parker, Treker, and Kee; and expanding the Gravely Turf business.
Bob Bradford was named senior vice president of operations. John Horn was named vice president of sales – Ariens whole goods, reporting to Hebbard. Horn previously held the position of director of sales for international, turf, government and distributor sales. Horn will be responsible for providing direction to the sales leadership team and implementing strategies to grow brands and sales channels, including the independent dealer channel.
The company also named Bill Engler director of sales-LSC, distributor, and industrial. Engler will serve as contact for national landscape and MRO (maintenance, repair and operating) accounts as well as a resource for dealers who support LSC sales. Engler previously held the position of director of sales – North America.
MIAMI – May 27 -- The Atlantic hurricane season will likely be a busy one that may spawn as many as 23 named tropical storms, including up to seven major hurricanes, a number that's not likely to be affected by theGulf oil spill, the U.S. government said Thursday.
The National Oceanic and Atmospheric Administration predicted that eight to 14 storms would strengthen into hurricanes, with top winds of 74 mph or higher. Three to seven of those could become major storms that reach Category 3 or higher — meaning they bring sustained winds of at least 111 mph.
"If this outlook holds true, this season could be one of the more active on record," NOAA administrator Jane Lubchenco said in a statement. "The greater likelihood of storms brings an increased risk of a landfall. In short, we urge everyone to be prepared."
A hurricane might help break up the oil spill staining the Gulf of Mexico, but the oil won't affect significantly how tropical storms develop, forecasters said. They don't know what kind of environmental hazards to expect, though there are fears that winds and waves could push the oil deeper into estuaries and wetlands.
Government scientists said Thursday that anywhere from 500,000 gallons to a million gallons a day has been leaking from the site where an oil rig exploded April 20, killing 11 people. BP PLC, which leased the rig and is responsible for the cleanup, and the Coast Guard previously had estimated the flow was about 210,000 gallons per day.
The expanding slick already has coated wildlife and marshes in Louisiana, but Lubchenco said the spill is still small relative to hurricanes — which sometimes can span the entire Gulf.
Although some oil could be pushed inland by a storm as it makes landfall, it could be difficult to determine whether it leaked from flooded cars or factories, Federal Emergency Management Agency chief Craig Fugate said.
The 2010 government forecast is based on the weakening of El Nino. The Pacific Ocean phenomenon created strong wind shear that helped suppress storm development in the Atlantic last season. Record warm water temperatures also will feed storms crossing the Atlantic this year.
Three hurricanes developed out of nine tropical storms in 2009. None of the hurricanes came ashore in the United States. Hurricane Ida hit Nicaragua as a Category 1 storm in November.
CHARLOTTE -- May 27 -- Husqvarna has previously communicated its intention to implement a number of structural changes in order to improve efficiency and reduce costs. In line with these changes, Husqvarna has decided to close the plant in Beatrice, Nebraska, and transfer production to the plant in Orangeburg, South Carolina.
The closure and transfer will be implemented in the second half of 2010. The cost for the measures is estimated at approximately SEK 110m, whereof cash items amount to approximately SEK 70m, which will be charged to income in the second quarter of 2010.
Annual savings from the measures are expected to amount to approximately SEK 40m and will be generated gradually from the start of 2011 with full effect as of 2012
The Beatrice plant assembles mainly Zero Turn Radius lawn mowers. The factory in Orangeburg manufactures similar products including riding garden tractors and tillers.
Together with an earlier announcement to close a factory in Greece, operating income in the second quarter of 2010 will be charged with restructuring costs totaling SEK 160m.
The total annual savings from the measures are estimated at approximately SEK 60m and will be generated gradually from the start of 2011 with full effect as of 2012.
Milwaukee – May 26 -- Ariens Co., a Brillion manufacturer of lawn and garden equipment, has acquired a British maker of riding lawn mowers.
The British firm, Countax Ltd., has 130 employees in Oxfordshire and sells products in the United Kingdom, Germany, France and the Netherlands.
Ariens has more than 1,200 employees, with operations in Wisconsin, Nebraska, Indiana, Alabama and Australia.
Terms of the acquisition were not made public by either of the privately held companies.
Countax will give Ariens a European base of operations, said company President Dan Ariens in a news release.
"We are committed to reinvigorating Countax and see opportunity for growth," Ariens said.
Harry Handkammer, Countax managing director, said: "There is a strong synergy between the Countax and Ariens business, as both are privately owned and enjoy common markets in landscaping and ground care."
