Amy E. Dahl - Managing Director, Corporate Communications and Investor Relations Michael J. Hoffman - Chairman, President and Chief Executive Officer Renee J. Peterson - Vice President, Treasurer and Chief Financial Officer Thomas J. Larson - Vice President, Corporate Controller

Mark L. Herbek - Cleveland Research Company Robert A. Kosowsky - Sidoti & Company, LLC James Barrett - C.L. King & Associates, Inc. Joshua Borstein - Longbow Research Joshua Wilson - Raymond James & Associates, Inc.

Good day, ladies and gentlemen, and welcome to The Toro Company’s Fiscal 2014 Full-Year And Fourth Quarter Earnings Conference Call. My name is Mina, and I'll be your coordinator for today. At this time, all participants are in listen-only mode. We will be facilitating a question-and-answer session towards the end of today’s conference. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. And now I would like to turn the presentation over to your host for today's conference, Amy Dahl, Managing Director of Corporate Communications and Investor Relations for The Toro Company. Please proceed Ms. Dahl. Amy E. Dahl: Thank you, Mina and good morning. Our earnings release was issued this morning by Business Wire and a copy can be found in the investor information section of our corporate website, thetorocompany.com. On our call today are Mike Hoffman, Chairman and Chief Executive Officer; Renee Peterson, Vice President, Treasurer and Chief Financial Officer and Tom Larson, Vice President and Corporate Controller. We'll begin with our customary forward-looking statement policy. During this call, we will make forward-looking statements regarding our business and future financial and operating results. You all are aware of the inherent difficulties, risks and uncertainties in making predictive statements. Our earnings release as well as our SEC filings, details some of the important risk factors that may cause our actual results to differ from those in our predictions. Please note that we do not have a duty to update our forward-looking statements. And with that I will now turn the call over to Mike. Michael J. Hoffman: Thank you, Amy, and greetings to all of our listeners. Fiscal 2014 was a special year for The Toro Company that featured the conclusion of our first 100-years in business, transition to our second century, as well as the final year of our Destination 2014 journey, which we are pleased to report was a success. Also laid in fiscal 2014, we entered into an agreement on our largest acquisition to-date, the BOSS professional snow and ice management business and started off our New Year with closing on the deal. I will comment further on this exciting new business later in the call. When we launched Destination 2014 back in fiscal 2011, we committed to achieving $100 million in organic sales growth each of the program’s four years as well as 12% or better in operating earnings by the end of fiscal 2014. We achieved over $128 million in sales growth this last year, which brought our Destination 2014 four year total to over $430 million. We also achieved operating earnings of 12.1%. We’re gratified that our employees’ dedication to hard work helped deliver these solid results and made Destination 2014 a successful quest, but not our final Destination. As Mark Twain is credited with saying “if you stand still you will fall behind.” In that sprit, the combination of Destination 2014 signals not an end, but a new beginning, the start of our next multi-year employee initiative that I will also discuss later in the call. This morning, we are pleased to report that the company delivered record setting results for the fiscal 2014 year, including records for revenues, operating earnings, and earnings per share. We achieved a 6.4% increase in net sales to $2.173 billion, our operating earning grew to $263 million, and we delivered earnings per share of $3.02. The company’s focus on both creating and returning value to our shareholders remain steadfast. As evidenced by the increased quarterly dividend our board just approved. Following a brief commentary on our businesses, Renee will discuss our financial and operating results in more detail. To begin with our Golf business, unfavorable weather at the start of the season in North America resulted in a slight decline in rounds played and golf fees for the year, but a strong summer in fall helped courses achieve an overall increase in revenues driven largely by food and beverage sales. Our new golf equipment introductions performed well in 2014, and we continued to help customers improve their operational efficiency. For example, the Sand Pro 2040Z is setting a new productivity standard in bunker maintenance by enabling courses to complete the job faster with less manual labor. Similarly, golf irrigation sales benefited from customer enthusiasm for our innovative new products like the INFINITY sprinklers and increased course renovation projects with new system installations. Product performance and the stability and strength of our distribution channel continues to be critical factors in sustaining our leadership position in golf. Moving to our landscape contractor businesses, strong demand for innovative offerings for both zero turn and stand-on equipment helped fuel sales. We also enjoyed an early boost of sales in the first half of the year due to increased cash flow northern contractors generated from the steady snow removal work they experienced last winter. The professional grounds equipment business grew in 2014 based on the strength of our products and improved state and local government budgets. Demand for our large rotary shows that productivity continues to be a watchword for such governmental as well as other grounds equipment customers. Our increased presence on state, local, and other cooperative contracts also contributed to our success. The professional rental and specialty construction businesses benefited from increased demand for our ground engaging equipment in the rental and contractor markets. Unfavorable weather in key markets slowed residential irrigation activity, however, our lighting business continued along its steady growth track. The micro irrigation business continued to grow as water shortages in critical agriculture areas drive increased adoption of micro irrigation technology. Sales for the year grew due mainly to demand for our innovative Aqua-Traxx products. Our Residential Equipment business delivered strong results for the year. Last winter’s heavy snowfalls drove retail activity that cleared snow to our inventory early in fiscal 2014 and set the stage for promising pre-season this winter. As anticipated, expanded placement in the spring resulted in solid sales for our all new line of Lawn-Boy walk power mowers. We enjoyed a good year in sales of our enhanced zero turn riding product offerings, right through to a successful fall finale when we also benefited from a strong showing from our electric blowers as consumer cleared their yards in preparation for winter’s on set. Finally, early channel and retail demand for snow throwers this fall fueled robust sales momentum that has continued to date. On the international scene, results were mixed. Residential segment sales were up for the year due to increased sales of snow products, the continued momentum in TimeMaster mower sales in Europe, and enhanced demand for Hayter products related to favorable weather conditions. However, unfavorable currency movements and adverse weather decreased sales activity in Australia. The International Professional segment much like our domestic markets continues to benefit from golf course managers interest in our new line of INFINITY sprinklers and the Lynx Central control system. Overall international sales were essentially flat for the year as positive results in golf, irrigation, and grounds equipments sales were offset by lower sales of residential products in Australia. In total, it was a good year for the Toro Company, both our Residential and Professional businesses posted solid gains across most product categories and are well-positioned for the year ahead. I’ll now turn the call over to Renee to detail our financial and operating results. Renee J. Peterson: Thank you, Mike, and good morning, everyone. Sales for fiscal 2014 grew to $2,172,700,000 compared to $2,041,400,000 for fiscal 2013. We achieved net earnings for the year of $173.9 million or $3.02 per share. This compares to fiscal 2013 earnings of $154.8 million or $2.62 per share. Net sales for the quarter were $414.1 million compared to $382.4 million for the same period a year-ago. We delivered net earnings of $10.9 million or $0.19 per share compared to $5 million or $0.08 per share in the fourth quarter of fiscal 2013. For the year, we repurchased over $1.6 million shares of company stock at an average price of about $63 per share for a total cost of about $100 million. This includes roughly $37,000 shares in the fourth quarter at about $2 million. At year end, we had approximately $2.7 million shares remaining on our authorization. For fiscal 2015, we anticipate spending a similar amount on share repurchases as we did last year. Our Professional segment sales were up 3.7% to $1,477,600,000 for the year. This includes 5.1% growth for the quarter to $268.9 million. Strong demand for landscape contractor, micro irrigation, construction and rental, and golf products all contributed to the growth for the year. Professional segment earnings were $276.3 million for the year, up 8.6% compared to fiscal 2013. Professional segment net earnings for the quarter totaled $31.6 million, a $9.8 million increase compared to last year. Our Residential segment sales for the year increased 13.1% to $672.4 million. Snow throwers sales led the way followed by riding and electric products. The increase was somewhat offset by unfavorable currency movements and weather in Australia as well as the walk power, the domestic walk power mower rework issue and a late spring. The fourth quarter saw residential sales rise 19% from a year ago to $138.8 million, which is attributable to favorable shipments of snow throwers, electric products and fall walk power mower activity. For the year Residential segment net earnings were $76.9 million up 24% from last year. Residential net earnings for the quarter totaled $16.3 million up $6.1 million from last years fourth quarter due to product mix and ongoing productivity improvement. Now on to our operating results. Gross margin for the year was up 10 basis points to 35.6%. For the four quarter gross margin improved 90 basis points to 34.5%. Realized pricing and productivity improvements positively impacted margin results, while unfavorable segment mix, currency exchange rates, and slightly higher commodity costs were negative influences. For fiscal 2015, we anticipated decrease in gross profit of about 10 basis points to 20 basis points due to a one-time impact from purchase accounting related to the BOSS acquisition. We also expect to see a drag in exchange rate similar to what we experienced last year. SG&A expense as a percent of sales decreased by 70 basis points for the whole year, while sustaining investment in engineering at the same rate as last year. SG&A decreased by 160 basis points for the quarter against an 8.3% increase in sales. The decreases for both the year and the quarter were primarily due to the leveraging of expenses over higher sales volumes. For fiscal 2015, we expect SG&A to be slightly better as a percent of sales. Other income for the year was down $3.5 million to $8.7 million, the decrease was primarily due to a legal recovery in fiscal 2013 that was not repeated this year and higher foreign currency losses. Operating earnings as a percent of sales improved 80 basis points to 12.1% for the year including a fourth quarter increase of 250 basis points to 4.7%. Interest expense declined for the year by 4.8% to $15.4 million, due to capitalized interest on large capital projects. Interest expense for the quarter was up 11.7% from the same period a year ago to $4.4 million. Our effective tax rate for the year was 32.2% compared to 31.7% last year, due to the benefit received in the first quarter of fiscal 2013 from the retroactive enactment of the Domestic Research Tax Credit that expired on December 31, 2013. We expect our effective tax rate for fiscal 2015 to be about 32.5%. Turning to the balance sheet; Accounts receivable at the end of the year totaled $158.2 million, an increase of about 1% compared to fiscal 2013. Net inventories were up 14.4% to $274.6 million, the increase reflects inventory to address our backlog of orders that were up by 50% as of year-end in both our professional and residential businesses. We expect existing orders to be filled early in fiscal 2015. Trade payables decreased 8.7% to $124.3 million, while we experience limited increases in the fourth quarter, commodity prices remain neutral to slightly higher for the year offset by both internal and supplier productivity improvements and favorable contracts. As you know, we remain focused on inventory accounts receivable and trade payables management, at the end of the year the company is 12-months average net working capital as a percent of sales improved to 15.1% compared to 16.6% a year-ago. As Mike will discuss in relation to our new employee initiative ongoing improvement in working capital will become an ever greater priority. As of fiscal 2015, our capital expenditures are projected to be about $75 million and additional investments in product research and development capabilities and capacity. We expect that depreciation and amortization will be approximately $60 million to $65 million. As Mike noted in light of our consistently strong levels of cash flow our Board increased our quarterly dividend by 25% to $0.25 per share from our previous rate of $0.20 per share. In fiscal 2014, the company paid $45 million in dividends, when added to the more than 1.6 million shares of repurchased common stock we returned almost $150 million to our shareholders for the year. These actions are consistent with our focus on returning value to our shareholders. That said our overall investment priority remains the same. We will continue to look for opportunities to drive profitable growth. I’ll now turn it back to Mike for his concluding comments. Michael J. Hoffman: Thank you, Renee. As our Centennial calendar year, draws to a close we’re gratified to have delivered record revenues, operating earnings and earnings per share along with increasing our dividend. While there are no guarantees of favorable weather in economic conditions, we look forward to delivering another strong showing in fiscal 2015 by focusing on those things we can control. We have good reason to embark on our second century with confidence. This positive outlook is based in part on our belief that customers will continue to respond to our steady introductions of innovative products and services, our leadership and providing customer valued solutions is reflected in the recognition we received for many of our latest innovations as well as for our service to our customers. Here some examples from the last couple of months. At their annual awards dinner on October 24, their professional grounds management society presented our company with the gold medal award in recognition of outstanding and long-term achievement in support of the Green industry. On October 30, the prestigious Dubai-based Emirates Golf Club received the Efficient Use of Resources Award from the International Association of Golf Tour Operators for their highly focused and sustained approach to water management and irrigation efficiency. This was due in large part to their investment in a complete state-of-the-art Toro irrigation system that help them reduce their water consumption by more than 30%. We are pleased to announce on November 4 that world-renowned Real Madrid name peoples club of the century signed an agreement extending our preferred supplier status for irrigation and turf equipment needs. And on November 12, Popular Science named our Recycler mower equipped with SmartStow a winner in their best of what’s new award in the home products category. It is certainly gratifying to receive such recognition across business categories as testimony to our employees with relentless commitment to make in our company the most trusted leader in solutions for the outdoor environment by delivering superior innovation and superior customer care. However, we do not take such recognition for granted fully realizing that to remain a leader. We must deliver on our commitment to excellence everyday, everywhere. Such efforts have us well positioned to take advantage of opportunities that head in 2015. Let’s take a few minutes to consider the prospects for each business. First in golf course by just face challenges that necessitate operators playing close attention to economics as well as agronomics. The total cost of ownership from acquisition to the daily utilization of equipment in irrigation has become a critical measure and decision point for customers. That’s why we coin the term turfonomics. To remain golf courses of our commitment to help them succeed but you may not find the word in Webster’s turfonomics has resonated with golf course operators as they continue to turn to Toro and our channel partners for advice and solutions. Now that Tier 4 driven engineering changes to our golf equipment are complete we have been able to redirect investment into additional new product development and are looking forward to launching more innovative new products in 2015. We will also continue to build momentum in the irrigation segment with our last advancements like the INFINITY sprinklers which are generating rate reviews and stronger sales. Like golf enhancing productivity is equally important to our contractor customers who enthusiastically welcome several new products we unveiled during the recent green industry expo in October. This coming spring contractors will be deploying new additions to their fleets, including the latest in our industry leading line of propane powered equipment of 52 in stand on more. Additionally contractors will benefit from a new stand-on spreader/sprayer used with our unique Lean-to-Steer technology. This allows operators to control steering with one hand so they can adjust application settings unapplied for enhanced precision and productivity. We are also well-positioned in the professional grounds business with highly productive products like our previously mentioned large rotary offerings. These mowers provide ready solutions for state and municipal governmental agencies that are looking to increased productivity. The outlook for growth for our professional rental and specialty construction businesses looks promising for 2015. Residential and commercial construction and builder confidence continues to grow. This year increased demand for both the purchases and rental of equipment. Shipments of the new RT 1200 riding trencher began in the fourth quarter. Early report saw the trencher is impressing customers during demonstrations, which will likely for early retail activity. Preparations are underway for new product launches during the American Rental Association show in February. We are optimistic about the growth opportunities for our residential and commercial irrigation and professional lighting businesses based on the positive housing news and product advancements. Our new elements alloy lighting lines shows promise for expanding our presence in the lighting fields. Market factors in the micro-irrigation field also remain favorable for long-term growth. Our solid positioning will continue to help us provide customer valued solutions for the ever growing global demand and do so in a way that promotes sustainability. Last month we began the global launch of an important new product for the agricultural market Aqua-Traxx flow control. This newest innovation gives growers the ability to improve the uniformity of drift irrigation systems. This is the first product in the industry that allows growers to achieve high efficiency and also precise flow rates across hilly terrain. There is also good news in our residential segment. Last years heavy snowfall continues to give snow throwers rapidly moving offshore for us. New spring lawn and garden product launches also hold promise for our business. The next generation of zero-turn mowers including models equipped with steering wheels is creating stir. Now homeowners can enjoy maneuverability and time savings of a zero-turn technology in their choice of controls either dual levers or a steering wheel. Another existing addition is the all new all will drive lot behind more. These new products have helped secured new and expanded store replacement with dealers and retailers. The International business should see additional golf project development in key regions as well as opportunities across most product categories were favorable whether and economic conditions prevail. Our international team reports positive customer reactions to our new products including the zero-turn riding equipment with steering wheels and the new steel deck walk power mower. Finally, the newest addition to our portfolio the recently acquired BOSS professional snow and ice management business is continuing to benefit from strong preseason demand as well as daily onset of cold weather. Our integration efforts are going very well. As we mentioned in our October 28 I will announcing the plan deal this acquisition aligns well with our company both from business and cultural perspective. The BOSS legacy mirrors are our own commitment to building long-term relationships based on trust and integrity by providing innovative high quality products and exceptional customer care. BOSS channel partners and customers can anticipate a seamless transition that upholds the industry leading standards and practices they have become a custom to and truly value. The addition of the BOSS operation to our company extends our presence in the professional contract and the municipal market and supports our growth goals at a meaningful way. So on summary we remain stead fast in our focus on innovation productivity and profitable growth as we transitioned from Destination 2014 to our new three-year employee initiative called Destination PRIME. The new initiative reflects our company’s continued focus on a future of unlimited opportunities. Our company is a robust growing enterprise that is only entering its PRIME. The three-year goals of Destination PRIME or to increase organic net sales by at least 5% each year, achieve operating earnings of at least 13% and drive working capital down to 13% or less by the end of the 2017. PRIME will also serve as an acronym highlighting our focus on productivity, relationships and innovation, which will help us generate momentum in pursuit of excellence in all that we do. We believe achieving these goals will bolster our ongoing drive to server customers and to increase shareholder value. With the addition of our new BOSS business, the company expects revenue growth of about 8% to 10% for fiscal 2015 and net earnings of about $3.30 to $3.40 per share. The company expects to report net earnings for the first quarter of about $0.47 per share. This concludes our formal remarks. We’ll now take your questions. So Mina back to you.

Thank you sir. [Operator Instructions] your first question comes from the line of Mr. Mark Herbek from Cleveland Research Company. Please proceed. Mark L. Herbek: Good morning. Michael J. Hoffman: Good morning Mark. Mark L. Herbek: Can you talk quickly about the snow category, obviously strong sales to this point and your ability to go back into production or potentially capture some of the upside from this point? Michael J. Hoffman: So, clearly we treat the snow business in two ways, the pre-season piece which is predictable and it has been a terrific pre-season, and the end-season piece is unknown, and the fact is a large part of the inventory and production has been consumed in the pre-season, probably even more than we expected. We expected a good pre-season, it’s been even stronger than that. And so to your point, we have gone back into production to some degree. As you know, with this business, you can’t chase every sale that has more variability and the same thing will apply to the BOSS business as well. So both our residential snow business and the BOSS snow business has had very good pre-seasons, we’re early in December, now the key is going to be the in-season piece that will take place in December, January, and February, and we hope to obviously see some snow falls that will help both to move any remaining product through to retail, but also set the stage for the next year’s pre-season. Mark L. Herbek: In terms of the inventory levels and then you also talked about some placement wins in 2015, can you kind of reconcile the two, inventory 14% higher, but then also some of the new placement you talked about, can you add some additional color on what the new placement - where the new wins are and how much of that inventory growth is attributable to these new wins? Michael J. Hoffman: Yes, let me comment first to the placement and then Renee can talk to the inventory specifically, because the fact is, as you know with the seasonal business, we head into the spring business. We talked about those placements and those products will start being produced and much of that is residential/landscape business, and those products actually will be produced now as we head into the New Year. So the inventory was less about that, but the fact is with some of those products that I did talk about, the Steering Wheel Z and the All-Wheel Drive walk power motor which are residential products. That will give us expanded placement with retailers and with dealers, but that’s really not at the - that’s not the inventory - that doesn’t address the inventory question that you brought up, so let Renee talk about that. Renee J. Peterson: Sure, and thank you Mike. So looking at the inventory, it’s really driven Mark by a couple of different factors. So one is that we are continuing through that final step in the transition to Tier 4, and there is also some new ISO regulations in Europe, so that’s driving some increase in our inventory. We also continue to build out some of our newer businesses and so expanding some inventory to support that growth. And then finally as I had mentioned earlier in the remarks, we do have an increase in our backlog, our orders backlog going into the year. And so, there is some impact to inventory related to that as well. As we look forward, we do expect better inventory, at year end next year it will be lower than it is - as it is right now at this year end. Mark L. Herbek: And then Renee, any update, any further details on the accretion potential of BOSS and maybe the impact that BOSS might be having on the first-quarter earnings guidance? Renee J. Peterson: Yes, we are still thinking about BOSS in that same range that we had talked about in the prior call of $0.05 to $0.10, and we’ve incorporated that into our total year guidance. When we look at the first quarter, I think it’s important, this is the first time that we come out with guidance for the quarter. We are seeing some growth year-over-year related to our earnings per share. It does impact, the BOSS acquisition does impact the first quarter, and we see that in the purchase accounting and it really relates to the inventory step up that occurs and that inventory will primarily flush through the P&L in Q1. So that’s also I think a driver to our Q1. Michael J. Hoffman: And Mark just to add on to that, we’ve always talked about this that we have, we wanted to look at the company in an annual context more than the quarter. This is a relatively small quarter; we have two relatively small quarters and two relatively larger ones, and so on the smaller ones this could be some variability even as you look at last year that the impact of snow, in-season snow last year in the first quarter that we haven’t experienced yet, so we’ve got the benefit of the pre-season part of the first quarter, but there is a lot of - fair amount of time left to figure out what’s going to happen in-season wise, snow wise in the first quarter. Mark L. Herbek: All right. Thanks Mike, thanks Renee. Michael J. Hoffman: Thank you, Mark. Renee J. Peterson: Thank you.

Thank you. Your next question comes from the line of Robert Kosowsky from Sidoti. Please go ahead. Your line is open. Robert A. Kosowsky: Good morning everyone. Hi, Dahl. Amy E. Dahl: Good morning. Michael J. Hoffman: Good morning, Rob. Robert A. Kosowsky: One quick numbers question. Renee, what did you say the gross margin guidance was for 2015? Renee J. Peterson: It is 10 to 20 basis points down, and the primary driver in that Rob is the purchase accounting impact? Robert A. Kosowsky: Okay, so 10 to 20 basis points down, obviously a negative headwind in the first quarter, but then you should see margin expansion in the back half of next year, I would imagine? Renee J. Peterson: Yes. Robert A. Kosowsky: Okay. And then otherwise, it seemed like margins in the professional segment were very strong. I was wondering if there was some favorable mix in there, because it just seems like 11% and change was significantly higher than what we've seen historically in the fourth quarters. Michael J. Hoffman: Yes, I guess there is always, mix is always a part of that, but again we would suggest you look at the margins on an annual basis, right, and so when you look at our margins for fiscal 2014 in Pro versus fiscal 2013, they are up 80 basis points. And that’s good improvement, but with that said, they are not actually at what they would be their historical highs you know have to backup a several years for that. So, we will continue to work on that and drive the opportunity to expand that margin. Some of that is borne out of new products and innovation, driving cost out of the system, reducing higher-quality, reducing warranty costs. It’s not one thing, it’s many things. Robert A. Kosowsky: Okay, that’s helpful. And then finally, SG&A, at least the growth rate seemed low given that you had a successful year and there are probably some bonuses to be paid. I'm wondering what some of the offsets were. So maybe some of the sources where you've gotten some productivity gains within SG&A to enable that kind of operative levers that we saw and the sustainability of that going forward. Renee J. Peterson: Well, we really have focused on improving our SG&A over time; it will continue to be an area of focus for us as we go into Destination PRIME. Really we have continued to invest in R&D at a rate that is similar, so we haven’t reduced that investment and we continue to focus on any area that we take out waste. If we can reduce our warranty, improve our quality those all benefit us from an SG&A perspective. But we did have some appropriate increase in incentives that have reversed those appropriately within the numbers. Michael J. Hoffman: And Rob just I mean I’d add and we’ve talked about this before I mean to get to Destination 2014 and now to get to Destination PRIME is going to take some combination right, some combination of improving our gross margins as well as leveraging some SG&A. So we saw the reduction of SG&A from 242 to 235 which for us is kind of a best we’ve been at and but we see more opportunities there to continue to do - make progress there and leverage SG&A to the things that Renee talked about while sustaining strong investment in engineering and R&D. Robert A. Kosowsky: Okay that’s helpful and then finally just the other segment was a lot more negative this year than it was last year in the fourth quarter and I’m wondering what some of the puts and takes were there. Renee J. Peterson: Rob there is really one item that’s driving the majority of the change and last year in our fourth quarter we had a legal settlement, a one-time legal recovery, so that’s a biggest change year-over-year. Robert A. Kosowsky: Okay that’s helpful. Thank you very much. Michael J. Hoffman: Thank you Rob.

Thank you. Your next question comes from the line of Jim Barrett from C.L. King & Associates. Please proceed.

Good morning everyone. Michael J. Hoffman: Good Morning Jim.

Mike, congratulations to you and your team on achieving the Destination 2014 target. Michael J. Hoffman: Thank you.

Thanks, my first question concerned Henderson products, was that brought to your attention prior to its sales and was that given its product line and its end-customers was that a company that was of interest to you in addition to BOSS - in addition to [both] BOSS rather. Michael J. Hoffman: BOSS do you mean?

Yes. Michael J. Hoffman: So well first, yes we were aware that was an auction and we wont go into a lot of the reasons here, but our prior focus clearly was around BOSS and right now let’s say our hands are full, but that is going very well, we think BOSS is just going to be a terrific addition like I said earlier in the remarks the cultural fit of that company with this company is hand to glow.

And certainly the product line seem like a closer fit and Renee in terms of the 50% increase in backlog, is that largely relating to snow blowers, does that also include lawn maintenance equipment and I assume it doesn’t include any BOSS. Renee J. Peterson: No, really it relates to both the Residential and the Professional segments and some impact related to the regulatory changes.

I see, okay. Michael J. Hoffman: You know what, it was both, it was that we had strong backlogs in both segments.

Good and Renee the plastic resin costs in 2015, if that happens to track with the declining oil prices, is that a potential moderate, positive for the cost of goods? Renee J. Peterson: Yes, I think it would be, however, it never seems to come down as quickly as it goes up, so we will continue to monitor that and hopefully we’ll see some benefit from them.

Okay and then last but not least. Mike is there any plan to take at least a selected price increase in 2015 on your product lines? Michael J. Hoffman: Yes, you go across the portfolio. I think last year we talked about realizing about 1% and this year again across the portfolio will realize some place between 1% and 2% we tend to get a little more price in Pro than we do in residential best way is for us to drive that change in residential is obviously with the new products. We have a number of new products coming in residential. So, all in it’s moving in the right direction.

Okay well thank you both. Michael J. Hoffman: Thank you. Renee J. Peterson: Thank you.

Thank you. Your next question comes from the line of John Borstein from Longbow Research.

Good morning everyone and congrats on the year. Michael J. Hoffman: Thank you, Josh.

Can you talk a little bit about contribution margins going forward? I know the past few years you have maintained a contribution margin in the 25% to 30% range and was just curious on your thoughts if that level is sustainable or not? Renee J. Peterson: Yes, we’ll continue to work as Mike said earlier both improving our SG&A leverage as well as our gross margin which will contribute to our incremental margins. We’ll continue to focus on pricing to market not to cost and looking at productivity and we have built those thoughts into our guidance as we go forward. Michael J. Hoffman: And to your point Josh I mean we clearly some of this embodied in Destination PRIME now, when you contrast Destination PRIME with Destination 2014, the operating earning side obviously the changes and as much but you have to remember when we launch Destination 2014, we had a number of recover years, if you will getting back to the level of performance we had experienced back in 2007 and 2008. And where there now, we’ve actually passed that, so does get a little harder but we continue to see opportunities for growth and leverage and higher levels of performance.

Okay, thanks for that. And then on the top-line guidance, how should we consider that in terms of res versus pro, domestic versus international? Can you weight some of those buckets for us? Michael J. Hoffman: Yes, we don’t break it out I know one of the comments we have gotten is as we talk about that revenue guidance to what degree will BOSS impact that versus - so organic versus acquisition. And just to be clear our top-line guidance for the enterprise is about without BOSS is about five points. Now when you factor BOSS in - but you remember the number we commented to BOSS revenues for 2014 were really peak revenues following an extraordinary season, preseason and season. And so what that may not exactly repeat and we’ve that variability in our snow business. So we’ll expect to see solid growth, similar growth of residential and professional balanced then the BOSS pieces on top of that, which will be down somewhat from their 2014 level if you will. And then and last international I mean international remains a little bit of a headwind with currency and so we do expect to see growth there, but it will be - it’ll come a little harder.

Okay. And so just to make sure I understand quickly, BOSS in 2014 I think you said did around $125 million and the expectation is for - that was an extraordinary year and so maybe they do a little less than that is the expectation for 2015? Michael J. Hoffman: Correct.

Okay, great. Michael J. Hoffman: Again these things all can change and so if we’ve that kind of winter that we experienced in the 2013/2014 season than the numbers obviously will change. That’s the variable part of the snow business and that’s we dealt with that with the residential part of our portfolio we now have - BOSS has an added we still relatively for the whole company relatively 10% of our revenues, so we think we can manage that well.

Okay, great. And then just on the margin goals for Destination PRIME, where do you see more of the margin growth coming from? Is it more on the gross side or the SG&A side? Michael J. Hoffman: Now I wish I could say it was one thing, it is going to have to be all things, so some of that is revenue growth and leveraging the goals with it, it’s going to be continued work on gross margin and operational efficiency and it’s going to be continued leveraging of SG&A.

Okay. And then just last a housekeeping question on interest expense, what should we anticipate for 2015? Renee J. Peterson: And so interest expense will increase by about $3 million to about $18 million for the year.

Okay, great I appreciate it. Thanks so much. Renee J. Peterson: Thank you. Michael J. Hoffman: Thank you, Josh.

Thank you. Your next question comes from the line of Sam Darkatsh from Raymond James. Please go ahead.

Hi, this is Josh filling in for Sam, thanks for taking my questions and congratulations on the year. Renee J. Peterson: Thanks Josh. Michael J. Hoffman: Good morning Josh, thank you.

Could you specifically quantify the purchase accounting impact from BOSS? Renee J. Peterson: We haven’t specifically called that out, but it is the primary driver to the declining gross margin year-over-year, 10 basis points to 20 basis points.

So at least 10 basis points? Is it fair to say at least 10 basis points? Renee J. Peterson: Yes, it would be, because it is a driver that would be a fair assumption.

Okay. And that's all in the first quarter? Renee J. Peterson: It will impact us in the first quarter correct, because it really - the piece that we’re talking about is that inventory step up piece and that does go through as you sell that initial inventory that you acquired with the acquisition.

Okay. Appreciate that. And then with regard to Destination PRIME and the working capital goal, which components of working capital do you expect to see the most improvement in to reach that new target? Michael J. Hoffman: Yes, good questions. As always it’s not one, it’s going to be all, but I would say probably the more weight on inventory and some of that what’s going on with working capital in the last couple of years with the whole tier 4, some of the new businesses that we’ve integrated into the company have caused that to rise up somewhat and it’ll have to be some from each area, so some from receivables and some from payables certainly, but more of it from inventory.

Okay. And how should we think about the other segment operating income for fiscal 2015? Renee J. Peterson: Yes, our other segment is primarily our corporate expenses, there is really nothing unusual that I would anticipate for fiscal 2015.

So similar to this year? Renee J. Peterson: It’s similar maybe a little bit of increase due to inflation and we’ll drive to offset as much of that as we can with productivity.

Okay. And then you talked about 1 to 2 points of price. Oil is potentially eventually a tailwind on the cost inflation side. Any other puts and takes in the price versus cost arbitrage as we look at fiscal 2015? Michael J. Hoffman: No, I think as Renee said earlier we’ll work hard to drive down some of the costs, these things tend to go down slower than they move the other way. So it will have to be across the board.

Thanks. Good luck with the next year. Renee J. Peterson: Thank you, Josh. Michael J. Hoffman: Thank you, Josh.

Thank you. This concludes the question-and-answer session. Ms. Dahl, please proceed to closing remarks. Amy E. Dahl: Thank you, Mina and thank you everybody for your questions and interest in Toro. We wish everybody a pleasant and safe holiday season and look forward to talking with you again in February to discuss our first quarter results. Thank you.

Thank you. Thank you for your participation in today’s conference. This concludes the presentation. You may now disconnect. Have a good day.