In 1883 in Carthage, Missouri, far removed from any major metropolitan or urban areas, an historical partnership began. J.P. Leggett, an inventor, initiated the partnership because he had developed an innovative bedspring. Mr. Leggett's bedspring consisted of single cone spring wire coils, formed and interlaced in a unique manner, then mounted on a wood slat base. The bedspring could then be used as a resilient, durable base for the then-popular co
tton, feather or horsehair mattresses.
Needing expertise in manufacturing and production, he recruited his brother-in-law, C.B. Platt, whose father owned and operated Platt Plow Works, into the partnership. Together, they perfected the equipment necessary to produce the components of their Leggett & Platt bedspring, which was patented in 1885.
The Carthage market for their new product was very limited. To expand the market to a wider region, Mr. Platt and George Leggett, brother of J. P. Leggett, would load a horse-drawn wagon with bedsprings and travel to surrounding communities. Often times, to conserve space, they would load the springs and slats separately into the wagon and then assemble them in a store, or on an adjacent sidewalk. The partnership prospered and the business was incorporated in 1901.
The company built its first factory and offices in Carthage in 1895. The workforce at that time consisted of the two partners and five employees. Soon after completion of the Carthage plant a second factory was built in Louisville, Kentucky.
In the next 50 years three more factories were built. Demand for the company's improved bedsprings was rising and a second plant was built in Carthage in 1925. The new plant was much larger and located next to a railroad to allow for expanded shipments of products and supplies. In 1942 an additional factory was built in Winchester, Kentucky; subsequently, the Louisville plant was consolidated with it. Texas for some time had proven to be a main market outlet and in 1947 a major factory was built in Ennis, Texas. By 1947 Leggett & Platt consisted of 4 plants and 500 employees.
Until 1933, bedsprings, although available in various models and continuously improved, were practically the only product offered by Leggett & Platt. However, in that year the company began to manufacture springs for innerspring mattresses, which were relatively new products in the industry and growing in popularity. Thereafter, the company slowly began to diversify its products within the bedding industry by producing rollaway beds and folding metal cots along with bed frames and bed rails.
In 1960 Harry M. Cornell Jr., J.P. Leggett's grandson, was elected President and CEO of the company, taking over for his father. The company's total sales in 1960 were approximately $7 million from three states... Kentucky, Texas and Missouri. Determining the course and future of the company became management's primary objective. Following an extensive evaluation of the company and its potential, Mr. Cornell and his management partners concluded that Leggett & Platt's best opportunities for profitable growth lay in a strategy of specializing in manufacturing, marketing, and distributing a broad and growing line of components and related products, first nationally and eventually on a world-wide basis. Key drivers of future sales and earnings would include aggressive internal growth initiatives, coupled with an active and ongoing acquisition program.
Even greater success followed, and Leggett & Platt became known as "the components people". Leggett & Platt stock was first traded over the counter in 1967. Twelve years later, on June 25th, 1979 top management was present in New York City to witness the stock's first day listed on the New York Stock Exchange. In 1985 Leggett & Platt grew into the Fortune 500 list of the largest U.S. based manufacturing companies. In 1999 the company became part of the S&P 500 Index.
Logical, measured steps toward diversification and expansion have led to this excellent long-term performance. Approximately two-thirds of the company's growth over time has come from acquisition of existing businesses. Many of them are "bolt on" extensions of Leggett businesses, and can be thought of as internal expansions made in lieu of building brand new facilities. Though acquisitions are expected to continue, if they were to cease altogether, the company would need to build more of its own plants, and internal growth would likely be about double the yearly average typically experienced.
During 39 years as a public company (the IPO was in March 1967), Leggett & Platt's sales, earnings, and cash flow from operations have grown substantially, along with shareholder dividends and the price of the stock. The table below highlights compounded annual growth rates in each of these measures over the last 10 and 38 years.
|
10 Years |
38 Years |
| Trade Sales |
10% |
17% |
| Net Earnings |
6% |
18% |
| Cash from Ops. |
8% |
19% |
| EPS |
5% |
13% |
| Dividends |
13% |
13% |
| Stock Price (12-31) |
7% |
16% |
Operations encompass over 300 manufacturing plants, distribution centers and other facilities across North America, and in several international locations. Employee-partners working in the various locations include 34,000 individuals...the people of Leggett & Platt who are the company's greatest asset.
Company-wide stock ownership encourages a pervasive spirit of partnership, and in recent years, management and employees have invested about $30 million annually in Leggett stock through a variety of employee benefit plans. More than 20% of the shares are held by officers, directors, employees, retirees, merger partners and their families.
Management is led by Felix E. Wright, Chairman; David S. Haffner, President and Chief Executive Officer; Karl Glassman, Executive Vice President and Chief Operating Officer; and Matt Flanigan, Chief Financial Officer.
