STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, Millions of Dollars Except Per Share Amounts)
|
| | | | | | | |
| | FIRST QUARTER |
| | 2017 | | 2016 |
| NET SALES | $ | 2,805.6 |
| | $ | 2,672.1 |
|
| COSTS AND EXPENSES | | | |
| Cost of sales | 1,740.3 |
| | 1,694.5 |
|
| Gross margin | 1,065.3 |
| | 977.6 |
|
| % of Net Sales | 38.0 | % | | 36.6 | % |
| Selling, general and administrative | 684.7 |
| | 627.8 |
|
| % of Net Sales | 24.4 | % | | 23.5 | % |
| Operating margin | 380.6 |
| | 349.8 |
|
| % of Net sales | 13.6 | % | | 13.1 | % |
| Other - net | 106.2 |
| | 46.2 |
|
| Gain on sales of businesses | (269.2 | ) | | — |
|
| Pension settlement | 12.5 |
| | — |
|
| Restructuring charges | 15.8 |
| | 8.0 |
|
| Income from operations | 515.3 |
| | 295.6 |
|
| Interest - net | 42.7 |
| | 41.5 |
|
| EARNINGS BEFORE INCOME TAXES | 472.6 |
| | 254.1 |
|
| Income taxes | 79.5 |
| | 65.5 |
|
| NET EARNINGS | 393.1 |
| | 188.6 |
|
| Less: net loss attributable to non-controlling interests | — |
| | (0.8 | ) |
| NET EARNINGS ATTRIBUTABLE TO COMMON SHAREOWNERS | $ | 393.1 |
| | $ | 189.4 |
|
| | | | |
| EARNINGS PER SHARE OF COMMON STOCK | | | |
| Basic | $ | 2.63 |
| | $ | 1.30 |
|
| Diluted | $ | 2.59 |
| | $ | 1.28 |
|
| | | | |
| DIVIDENDS PER SHARE | $ | 0.58 |
| | $ | 0.55 |
|
| | | | |
| WEIGHTED AVERAGE SHARES OUTSTANDING (in thousands) | | | |
| Basic | 149,208 |
| | 145,870 |
|
| Diluted | 151,526 |
| | 147,619 |
|
STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, Millions of Dollars)
|
| | | | | | | | |
| | | April 1, 2017 | | December 31, 2016 |
| ASSETS | | | | |
| Cash and cash equivalents | | $ | 378.0 |
| | $ | 1,131.8 |
|
| Accounts and notes receivable, net | | 1,728.0 |
| | 1,302.8 |
|
| Inventories, net | | 1,976.7 |
| | 1,478.0 |
|
| Assets held for sale | | — |
| | 523.4 |
|
| Other current assets | | 285.6 |
| | 352.5 |
|
| Total current assets | | 4,368.3 |
| | 4,788.5 |
|
| Property, plant and equipment, net | | 1,538.3 |
| | 1,451.2 |
|
| Goodwill and other intangibles, net | | 11,967.5 |
| | 8,993.5 |
|
| Other assets | | 788.0 |
| | 401.7 |
|
| Total assets | | $ | 18,662.1 |
| | $ | 15,634.9 |
|
| LIABILITIES AND SHAREOWNERS’ EQUITY | | | | |
| Short-term borrowings | | $ | 1,167.4 |
| | $ | 12.1 |
|
| Accounts payable | | 1,928.8 |
| | 1,640.4 |
|
| Accrued expenses | | 1,118.2 |
| | 1,101.5 |
|
| Liabilities held for sale | | — |
| | 53.5 |
|
| Total current liabilities | | 4,214.4 |
| | 2,807.5 |
|
| Long-term debt | | 3,815.6 |
| | 3,815.3 |
|
| Other long-term liabilities | | 3,814.0 |
| | 2,638.5 |
|
| Stanley Black & Decker, Inc. shareowners’ equity | | 6,811.5 |
| | 6,367.0 |
|
| Non-controlling interests’ equity | | 6.6 |
| | 6.6 |
|
| Total liabilities and shareowners' equity | | $ | 18,662.1 |
| | $ | 15,634.9 |
|
STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES
SUMMARY OF CASH FLOW ACTIVITY
(Unaudited, Millions of Dollars)
|
| | | | | | | | |
| | | FIRST QUARTER |
| | | 2017 | | 2016 |
| | OPERATING ACTIVITIES | | | |
| | Net earnings | $ | 393.1 |
| | $ | 188.6 |
|
| | Depreciation and amortization | 101.5 |
| | 100.1 |
|
| | Pre-tax gain on sales of businesses | (269.2 | ) | | — |
|
| | Changes in working capital1 | (410.2 | ) | | (268.0 | ) |
| | Other | 39.2 |
| | (113.8 | ) |
| | Net cash used in operating activities | (145.6 | ) | | (93.1 | ) |
| | INVESTING AND FINANCING ACTIVITIES | | | |
| | Capital and software expenditures | (64.7 | ) | | (64.9 | ) |
| | Proceeds from issuances of common stock | 17.3 |
| | 8.5 |
|
| | Proceeds from sales of businesses, net of cash sold | 744.8 |
| | — |
|
| | Business acquisitions, net of cash acquired | (2,435.4 | ) | | (13.0 | ) |
| | Net short-term borrowings | 1,156.7 |
| | 481.2 |
|
| | Net investment hedge settlements | 20.7 |
| | (2.4 | ) |
| | Cash dividends on common stock | (86.7 | ) | | (79.6 | ) |
| | Purchases of common stock for treasury | (13.5 | ) | | (361.4 | ) |
| | Effect of exchange rate changes on cash | 38.1 |
| | 17.1 |
|
| | Other | 14.5 |
| | (5.6 | ) |
| | Net cash used in investing and financing activities | (608.2 | ) | | (20.1 | ) |
| | Decrease in Cash and Cash Equivalents | (753.8 | ) | | (113.2 | ) |
| | Cash and Cash Equivalents, Beginning of Period | 1,131.8 |
| | 465.4 |
|
| | Cash and Cash Equivalents, End of Period | $ | 378.0 |
| | $ | 352.2 |
|
| | | | | |
| | Free Cash Flow Computation2 | | | |
| | Operating cash flow | $ | (145.6 | ) | | $ | (93.1 | ) |
| | Less: capital and software expenditures | (64.7 | ) | | (64.9 | ) |
| | Free cash flow (before dividends) | $ | (210.3 | ) | | $ | (158.0 | ) |
| | | | | |
1 | Working capital is comprised of accounts receivable, inventory, accounts payable and deferred revenue. |
2 | 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. 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. |
| | |
STANLEY BLACK & DECKER, INC. AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(Unaudited, Millions of Dollars)
|
| | | | | | | |
| | FIRST QUARTER |
| | 2017 | | 2016 |
| NET SALES | | | |
| Tools & Storage | $ | 1,854.5 |
| | $ | 1,706.9 |
|
| Security | 478.5 |
| | 504.2 |
|
| Industrial | 472.6 |
| | 461.0 |
|
| Total | $ | 2,805.6 |
| | $ | 2,672.1 |
|
| SEGMENT PROFIT | | | |
| Tools & Storage | $ | 287.3 |
| | $ | 262.0 |
|
| Security | 50.9 |
| | 60.2 |
|
| Industrial | 86.3 |
| | 76.0 |
|
| Segment Profit | 424.5 |
| | 398.2 |
|
| Corporate Overhead | (43.9 | ) | | (48.4 | ) |
| Total | $ | 380.6 |
| | $ | 349.8 |
|
| Segment Profit as a Percentage of Net Sales | | | |
| Tools & Storage | 15.5 | % | | 15.3 | % |
| Security | 10.6 | % | | 11.9 | % |
| Industrial | 18.3 | % | | 16.5 | % |
| Segment Profit | 15.1 | % | | 14.9 | % |
| Corporate Overhead | (1.6 | )% | | (1.8 | )% |
| Total | 13.6 | % | | 13.1 | % |
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 2017 | | |
| | | Reported | | Acquisition-
Related Charges & Other1 | | Normalized2 | | FIRST QUARTER 2016 |
| Gross margin | | $ | 1,065.3 |
| | $ | 6.8 |
| | $ | 1,072.1 |
| | $ | 977.6 |
|
| % of Net Sales | | 38.0 | % | | | | 38.2 | % | | 36.6 | % |
| Selling, general and administrative | | 684.7 |
| | (10.7 | ) | | 674.0 |
| | 627.8 |
|
| % of Net Sales | | 24.4 | % | | | | 24.0 | % | | 23.5 | % |
| Operating margin | | 380.6 |
| | 17.5 |
| | 398.1 |
| | 349.8 |
|
| % of Net Sales | | 13.6 | % | | | | 14.2 | % | | 13.1 | % |
| Earnings before income taxes | | 472.6 |
| | (211.2 | ) | | 261.4 |
| | 254.1 |
|
| Income taxes | | 79.5 |
| | (14.1 | ) | | 65.4 |
| | 65.5 |
|
| Net earnings | | 393.1 |
| | (197.1 | ) | | 196.0 |
| | 189.4 |
|
| Diluted earnings per share of common stock | | $ | 2.59 |
| | $ | (1.30 | ) | | $ | 1.29 |
| | $ | 1.28 |
|
1 Acquisition-related charges and other relates primarily to integration and consulting costs and gain on sales of businesses.
2 The normalized 2017 information, as reconciled to GAAP above, is considered relevant to aid analysis of the Company’s margin and
earnings results aside from the material impact of the acquisition-related charges and gain on sales of businesses.
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 2017 | | |
| | | | Reported | | Acquisition- Related Charges1 | | Normalized2 | | FIRST QUARTER 2016 |
| | SEGMENT PROFIT | | | | | | | | |
| | Tools & Storage | | $ | 287.3 |
| | $ | 17.3 |
| | $ | 304.6 |
| | $ | 262.0 |
|
| | Security | | 50.9 |
| | 0.2 |
| | 51.1 |
| | 60.2 |
|
| | Industrial | | 86.3 |
| | — |
| | 86.3 |
| | 76.0 |
|
| | Segment Profit | | 424.5 |
| | 17.5 |
| | 442.0 |
| | 398.2 |
|
| | Corporate Overhead | | (43.9 | ) | | — |
| | (43.9 | ) | | (48.4 | ) |
| | Total | | $ | 380.6 |
| | $ | 17.5 |
| | $ | 398.1 |
| | $ | 349.8 |
|
| | Segment Profit as a Percentage of Net Sales | | | | | | | | |
| | Tools & Storage | | 15.5 | % | | | | 16.4 | % | | 15.3 | % |
| | Security | | 10.6 | % | | | | 10.7 | % | | 11.9 | % |
| | Industrial | | 18.3 | % | | | | 18.3 | % | | 16.5 | % |
| | Segment Profit | | 15.1 | % | | | | 15.8 | % | | 14.9 | % |
| | Corporate Overhead | | (1.6 | )% | | | | (1.6 | )% | | (1.8 | )% |
| | Total | | 13.6 | % | | | | 14.2 | % | | 13.1 | % |
| | | | | | | | | | |
1 | Acquisition-related charges relate primarily to integration and consulting costs. |
2 | The normalized 2017 business segment information, as reconciled to GAAP above, is considered relevant to aid analysis of the Company's segment profit results aside from the material impact of the acquisition-related charges. |
