STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, Millions of Dollars Except Per Share Amounts)

FIRST QUARTER

2024

2023

NET SALES

$

3,869.5

$

3,931.8

COSTS AND EXPENSES

Cost of sales

2,761.0

3,096.3

Gross profit

1,108.5

835.5

% of Net Sales

28.6%

21.2%

Selling, general and administrative

851.8

825.1

% of Net Sales

22.0%

21.0%

Other - net

80.0

63.7

Loss on sales of businesses

-

7.6

Asset impairment charge

25.5

-

Restructuring charges

15.0

12.1

Income (loss) from operations

136.2

(73.0)

Interest - net

87.9

91.1

EARNINGS (LOSS) BEFORE INCOME TAXES

48.3

(164.1)

Income taxes

28.8

23.7

NET EARNINGS (LOSS)

$

19.5

$

(187.8)

EARNINGS (LOSS) PER SHARE OF COMMON STOCK

Basic

$

0.13

$

(1.26)

Diluted

$

0.13

$

(1.26)

DIVIDENDS PER SHARE OF COMMON STOCK

$

0.81

$

0.80

WEIGHTED-AVERAGE SHARES OUTSTANDING (in thousands)

Basic

150,235

149,574

Diluted

8

STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, Millions of Dollars)

March 30,

December 30,

2024

2023

ASSETS

Cash and cash equivalents

$

476.6

$

449.4

Accounts and notes receivable, net

1,708.9

1,302.0

Inventories, net

4,693.3

4,738.6

Current assets held for sale

136.3

140.8

Other current assets

405.7

386.5

Total current assets

7,420.8

7,017.3

Property, plant and equipment, net

2,115.9

2,169.9

Goodwill and other intangibles, net

11,857.8

11,945.5

Long-term assets held for sale

691.2

716.8

Other assets

1,768.2

1,814.3

Total assets

$

23,853.9

$

23,663.8

LIABILITIES AND SHAREOWNERS' EQUITY

Short-term borrowings

$

1,740.4

$

1,074.8

Current maturities of long-term debt

500.0

1.1

Accounts payable

2,337.5

2,298.9

Accrued expenses

2,206.5

2,464.3

Current liabilities held for sale

45.0

44.1

Total current liabilities

6,829.4

5,883.2

Long-term debt

5,602.1

6,101.0

Long-term liabilities held for sale

83.4

84.8

Other long-term liabilities

2,462.6

2,538.7

Shareowners' equity

8,876.4

9,056.1

Total liabilities and shareowners' equity

$

23,853.9

$

23,663.8

9

STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

SUMMARY OF CASH FLOW ACTIVITY

(Unaudited, Millions of Dollars)

FIRST QUARTER

2024

2023

OPERATING ACTIVITIES

Net earnings (loss)

$

19.5

$

(187.8)

Depreciation and amortization

140.2

161.2

Loss on sales of businesses

-

7.6

Asset impairment charge

25.5

-

Changes in working capital1

(359.8)

(181.2)

Other

(256.4)

(86.1)

Net cash used in operating activities

(431.0)

(286.3)

INVESTING AND FINANCING ACTIVITIES

Capital and software expenditures

(65.7)

(68.2)

Proceeds from debt issuances, net of fees

-

747.2

Net short-term commercial paper borrowings (repayments)

674.9

(285.9)

Proceeds from issuances of common stock

3.8

3.1

Purchases of common stock for treasury

(6.3)

(4.8)

Cash dividends on common stock

(121.8)

(119.8)

Effect of exchange rate changes on cash

(27.6)

9.1

Other

0.5

(8.6)

Net cash provided by investing and financing activities

457.8

272.1

Increase (decrease) in cash, cash equivalents and restricted cash

26.8

(14.2)

Cash, cash equivalents and restricted cash, beginning of period

454.6

404.9

Cash, cash equivalents and restricted cash, end of period

$

481.4

$

390.7

Free Cash Flow Computation2

Net cash used in operating activities

$

(431.0)

$

(286.3)

Less: capital and software expenditures

(65.7)

(68.2)

Free cash flow (before dividends)

$

(496.7)

$

(354.5)

Reconciliation of Cash, Cash Equivalents and Restricted Cash

March 30, 2024

December 30, 2023

Cash and cash equivalents

$

476.6

$

449.4

Restricted cash included in Other current assets

1.5

4.6

Cash and cash equivalents included in Current assets held for sale

3.3

0.6

Cash, cash equivalents and restricted cash

$

481.4

$

454.6

  • Working capital is comprised of accounts receivable, inventory, accounts payable and deferred revenue.
  • Free cash flow is defined as cash flow from operations less capital and software expenditures. Management considers free cash flow an important measure of its liquidity, as well as its ability to fund future growth and to provide a return to the shareowners, and is useful information for investors. Free cash flow does not include deductions for mandatory debt service, other borrowing activity, discretionary dividends on the Company's common stock and business acquisitions, among other items.

10

STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

BUSINESS SEGMENT INFORMATION

(Unaudited, Millions of Dollars)

FIRST QUARTER

2024

2023

NET SALES

Tools & Outdoor

$

3,284.6

$

3,315.4

Industrial

584.9

616.4

Total

$

3,869.5

$

3,931.8

SEGMENT PROFIT

Tools & Outdoor

$

255.7

$

18.7

Industrial

65.2

67.4

Segment Profit

320.9

86.1

Corporate Overhead

(64.2)

(75.7)

Total

$

256.7

$

10.4

Segment Profit as a Percentage of Net Sales

Tools & Outdoor

7.8%

0.6%

Industrial

11.1%

10.9%

Segment Profit

8.3%

2.2%

11

STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP EARNINGS FINANCIAL MEASURES TO CORRESPONDING

NON-GAAP FINANCIAL MEASURES

(Unaudited, Millions of Dollars Except Per Share Amounts)

FIRST QUARTER 2024

Non-GAAP

Non-GAAP1

GAAP

Adjustments

Gross profit

$

1,108.5

$

14.4

$

1,122.9

% of Net Sales

28.6%

29.0%

Selling, general and administrative

851.8

(20.1)

831.7

% of Net Sales

22.0%

21.5%

Earnings before income taxes

48.3

71.5

119.8

Income taxes

28.8

6.8

35.6

Net earnings

19.5

64.7

84.2

Diluted earnings per share of common stock

$

0.13

$

0.43

$

0.56

FIRST QUARTER 2023

Non-GAAP

Non-GAAP1

GAAP

Adjustments

Gross profit

$

835.5

$

73.4

$

908.9

% of Net Sales

21.2%

23.1%

Selling, general and administrative

825.1

(20.7)

804.4

% of Net Sales

21.0%

20.5%

Loss before income taxes

(164.1)

106.8

(57.3)

Income taxes

23.7

(20.4)

3.3

Net loss

(187.8)

127.2

(60.6)

Diluted loss per share of common stock

$

(1.26)

$

0.85

$

(0.41)

  • The Non-GAAP 2024 and 2023 information, as reconciled to GAAP above, is considered relevant to aid analysis and understanding of the Company's results, business trends and outlook measures aside from the material impact of certain gains and charges and ensures appropriate comparability to operating results of prior periods. See further detail on Non-GAAP adjustments on page 14.

12

STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP SEGMENT PROFIT FINANCIAL MEASURES TO CORRESPONDING

NON-GAAP FINANCIAL MEASURES

(Unaudited, Millions of Dollars)

FIRST QUARTER 2024

Non-GAAP

GAAP

Adjustments1

Non-GAAP3

SEGMENT PROFIT

Tools & Outdoor

$

255.7

$

22.9

$

278.6

Industrial

65.2

5.7

70.9

Segment Profit

320.9

28.6

349.5

Corporate Overhead

(64.2)

5.9

(58.3)

Total

$

256.7

$

34.5

$

291.2

Segment Profit as a Percentage of Net Sales

Tools & Outdoor

7.8%

8.5%

Industrial

11.1%

12.1%

Segment Profit

8.3%

9.0%

  • Non-GAAPadjustments relate primarily to footprint actions associated with the supply chain transformation and transition services costs related to previously divested businesses.

FIRST QUARTER 2023

Non-GAAP

GAAP

Adjustments2

Non-GAAP3

SEGMENT PROFIT

Tools & Outdoor

$

18.7

$

79.2

$

97.9

Industrial

67.4

0.3

67.7

Segment Profit

86.1

79.5

165.6

Corporate Overhead

(75.7)

14.6

(61.1)

Total

$

10.4

$

94.1

$

104.5

Segment Profit as a Percentage of Net Sales

Tools & Outdoor

0.6%

3.0%

Industrial

10.9%

11.0%

Segment Profit

2.2%

4.2%

  • Non-GAAPadjustments relate primarily to footprint actions and other costs associated with the supply chain transformation

and integration-related costs.

  • The Non-GAAP 2024 and 2023 business segment information, as reconciled to GAAP above, is considered relevant to aid analysis and understanding of the Company's results, business trends and outlook measures aside from the material impact of certain gains and charges and ensures appropriate comparability to operating results of prior periods.

13

STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP EARNINGS (LOSS) TO EBITDA

(Unaudited, Millions of Dollars)

FIRST QUARTER

2024

2023

Net earnings (loss)

$

19.5

$

(187.8)

% of Net Sales

0.5%

-4.8%

Interest - net

87.9

91.1

Income taxes

28.8

23.7

Depreciation and amortization

140.2

161.2

EBITDA1

$

276.4

$

88.2

% of Net Sales

7.1%

2.2%

Non-GAAP Adjustments before income taxes

71.5

106.8

Less: Accelerated depreciation included in Non-GAAP Adjustments before income taxes

5.3

17.5

Adjusted EBITDA1

$

342.6

$

177.5

% of Net Sales

8.9%

4.5%

  • EBITDA is earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA represents EBITDA excluding certain gains and charges, as summarized below. EBITDA and Adjusted EBITDA, both Non-GAAP measures, are considered relevant to aid analysis and understanding of the Company's operating results and ensures appropriate comparability to prior periods.

SUMMARY OF NON-GAAP ADJUSTMENTS BEFORE INCOME TAXES

(Unaudited, Millions of Dollars)

FIRST QUARTER

2024

2023

Supply Chain Transformation Costs:

Footprint Rationalization2

$

8.4

$

59.3

Strategic Sourcing & Operational Excellence3

5.8

14.1

Facility-related costs

0.7

0.7

Voluntary retirement program

-

(0.1)

Other charges (gains)

(0.5)

(0.6)

Gross Profit

$

14.4

$

73.4

Supply Chain Transformation Costs:

Footprint Rationalization2

$

7.5

$

0.1

Complexity Reduction

0.3

0.1

Acquisition & integration-related costs4

2.8

10.1

Transition services costs related to previously divested businesses

5.5

12.8

Voluntary retirement program

-

(0.9)

Other charges (gains)

4.0

(1.5)

Selling, general and administrative

$

20.1

$

20.7

Other, net5

$

(3.5)

$

(7.0)

Loss on sales of businesses

-

7.6

Asset impairment charge6

25.5

-

Restructuring charges

15.0

12.1

Earnings (loss) before income taxes

$

71.5

$

106.8

  • Footprint Rationalization costs in 2024 primarily relate to accelerated depreciation of production equipment of $4.9 million and other facility exit and re-configuration costs of $10.0 million. In 2023, transfers and closures of targeted manufacturing sites, including Fort Worth, Texas and Cheraw, South Carolina as previously announced in March 2023, resulted in accelerated depreciation of production equipment of $17.0 million and non-cash asset write-downs of $42.2 million (predominantly tooling, raw materials and WIP).
  • Strategic Sourcing & Operational Excellence costs in 2023 primarily relate to third-party consultant fees to provide expertise in identifying and quantifying opportunities to source in a more integrated manner and re-designin-plant operations following footprint rationalization, developing a detailed program and related governance, and assisting the Company with the implementation of actions necessary to achieve the related objectives.
  • Acquisition & integration-related costs primarily relate to the MTD and Excel acquisitions, including costs to integrate the organizations and shared processes, as well as harmonize key IT applications and infrastructure.
  • Includes deal-related costs, net of income related to providing transition services to previously divested businesses.
    6 The $25.5 million pre-tax asset impairment charge in 2024 related to the Infrastructure business.

14

Attachments

  • Original Link
  • Original Document
  • Permalink

Disclaimer

Stanley Black & Decker Inc. published this content on 30 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 May 2024 17:26:08 UTC.