Toro 2015 Annual Report Download - page 5

agriculture irrigation businesses. We were honored to
have recently been recognized by the U.S. Environmental
Protection Agency as the first large irrigation product
manufacturer to be named the “2015 WaterSense®
Partner of the Year” for contributions in product
innovations to improve water use eciency. This
noteworthy award is evidence of why customers turn to
Toro for real solutions that promote healthy plants and
turf in a sustainable manner. Furthermore, growing
concerns surrounding water availability and cost is
helping drive increased adoption for our agricultural
irrigation products, including our expanded lineup of
Aqua-Traxx® FC (Flow Control) drip tape and Neptune®
flat emitter dripline to serve a wider variety of crop
applications.
For residential homeowners, we have launched three
new TimeCutter® zero-turn riders for fiscal 2016 that
were designed with customer feedback in mind. They
include two new lever-steer models that are equipped
with commercial-grade decks for more challenging
terrain, and a third steering wheel model with a wider
54-inch cutting deck and larger rear wheels.
Outlook
The record-setting results we delivered in fiscal
2015 heighten my appreciation of and pride in being
associated with our great team. We look forward to
fiscal 2016 with this strong team in place to tackle the
challenges ahead. While there are no guarantees of
favorable weather and economic conditions, we will
continue to focus on those things we can control. This
includes our mission to provide superior innovation and
superior customer care.
A year ago, I discussed the goals of our current three-
year employee initiative, Destination PRIME. These goals
include increasing organic net sales by more than 5
percent each year, achieving operating earnings of at
least 13 percent, and driving net working capital down to
13 percent or better by the end of 2017. Although our net
working capital progress slowed and then moved in the
wrong direction in 2015 − a situation we will remedy in
fiscal 2016 – overall, we made good progress on our
Destination PRIME program goals.
Our Destination PRIME year one results reflect our
performance in general. While our 2015 sales and
earnings performance was generally gratifying, we
have more work to do. We must take decisive
measures to better serve customers by becoming a
more reliable supplier. Similarly, manufacturing
variances must be addressed and improved. We have
the team, the talent and spirit to get these jobs done,
and we remain steadfast in our commitment to
innovation, productivity and profitable growth, and
returning value to our shareholders.
As we continue our focus on driving market leadership
and delivering successful results, I was pleased to
announce that Rick Olson was promoted to the position of
president and chief operating ocer in 2015, followed by
his election to The Toro Company’s Board of Directors.
His rich knowledge of the company and broad experience
provide him with a unique strategic perspective that will
be instrumental in helping drive us toward the
achievement of our Destination PRIME goals and beyond.
On behalf of our Board of Directors and employees, I
want to thank all of you, our shareholders, for your
continued trust in The Toro Company.
Sincerely,
Michael J. Homan
Chairman and Chief Executive Ocer