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THE STANLEY WORKS AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, Millions of Dollars Except Per Share Amounts)
FIRST QUARTER | ||||||||
2006 | 2005 | |||||||
NET SALES | $ | 968.7 | $ | 796.3 | ||||
COSTS AND EXPENSES | ||||||||
Cost of sales | 636.8 | 509.3 | ||||||
Selling, general and administrative | 238.8 | 184.4 | ||||||
Interest-net | 15.6 | 7.6 | ||||||
Other-net | 19.3 | 9.5 | ||||||
Restructuring charges | 7.3 | — | ||||||
917.8 | 710.8 | |||||||
EARNINGS FROM CONTINUING OPERATIONS | ||||||||
BEFORE INCOME TAXES | 50.9 | 85.5 | ||||||
Income taxes | 12.4 | 19.7 | ||||||
NET EARNINGS FROM CONTINUING OPERATIONS | $ | 38.5 | $ | 65.8 | ||||
Earnings (loss) from discontinued operations (including loss | ||||||||
on disposal of $1.5 million in 2006) before income taxes | (1.0 | ) | 0.9 | |||||
Income taxes (benefit) on discontinued operations | (0.2 | ) | 0.1 | |||||
NET EARNINGS (LOSS) FROM DISCONTINUED OPERATIONS | (0.8 | ) | 0.8 | |||||
NET EARNINGS | $ | 37.7 | $ | 66.6 | ||||
BASIC EARNINGS (LOSS) PER SHARE OF COMMON STOCK | ||||||||
Continuing operations | $ | 0.46 | $ | 0.79 | ||||
Discontinued operations | (0.01 | ) | 0.01 | |||||
Total basic earnings per share of common stock | $ | 0.46 | $ | 0.80 | ||||
DILUTED EARNINGS (LOSS) PER SHARE OF COMMON STOCK | ||||||||
Continuing operations | $ | 0.45 | $ | 0.77 | ||||
Discontinued operations | (0.01 | ) | 0.01 | |||||
Total diluted earnings per share of common stock | $ | 0.45 | $ | 0.78 | ||||
DIVIDENDS PER SHARE | $ | 0.29 | $ | 0.28 | ||||
AVERAGE SHARES OUTSTANDING (in thousands) | ||||||||
Basic | 82,892 | 82,822 | ||||||
Diluted | 84,804 | 85,156 | ||||||
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THE STANLEY WORKS AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited, Millions of Dollars)
April 1, 2006 | December 31, 2005 | |||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 204.9 | $ | 657.8 | ||||
Accounts and notes receivable | 782.4 | 609.6 | ||||||
Inventories | 548.5 | 460.7 | ||||||
Other current assets | 90.5 | 84.2 | ||||||
Assets held for sale | 3.4 | 13.3 | ||||||
Total current assets | 1,629.7 | 1,825.6 | ||||||
Property, plant and equipment | 491.4 | 467.1 | ||||||
Goodwill and other intangibles | 1,482.0 | 1,060.4 | ||||||
Other assets | 184.5 | 192.0 | ||||||
Total assets | $ | 3,787.6 | $ | 3,545.1 | ||||
LIABILITIES AND SHAREOWNERS’ EQUITY | ||||||||
Short-term borrowings | $ | 400.7 | $ | 170.2 | ||||
Accounts payable | 411.0 | 327.7 | ||||||
Accrued expenses | 464.5 | 374.3 | ||||||
Liabilities held for sale | — | 3.1 | ||||||
Total current liabilities | 1,276.2 | 875.3 | ||||||
Long-term debt | 821.3 | 895.3 | ||||||
Other long-term liabilities | 363.1 | 329.6 | ||||||
Shareowners’ equity | 1,327.0 | 1,444.9 | ||||||
Total liabilities and equity | $ | 3,787.6 | $ | 3,545.1 | ||||
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THE STANLEY WORKS AND SUBSIDIARIES
SUMMARY OF CASH FLOW ACTIVITY
(Unaudited, Millions of Dollars)
FIRST QUARTER | ||||||||
2006 | 2005 | |||||||
OPERATING ACTIVITIES | ||||||||
Net earnings | $ | 37.7 | $ | 66.6 | ||||
Depreciation and amortization | 30.3 | 23.4 | ||||||
Changes in working capital | 9.6 | (21.2 | ) | |||||
Other | 7.6 | (8.2 | ) | |||||
Net cash provided by operating activities | 85.2 | 60.6 | ||||||
INVESTING AND FINANCING ACTIVITIES | ||||||||
Capital and software expenditures | (14.5 | ) | (10.5 | ) | ||||
Proceeds (taxes paid) from sale of business | 0.9 | (10.6 | ) | |||||
Business acquisitions and asset disposals | (490.6 | ) | (59.7 | ) | ||||
Cash dividends on common stock | (23.8 | ) | (23.2 | ) | ||||
Other | (10.1 | ) | 103.9 | |||||
Net cash used in investing and financing activities | (538.1 | ) | (0.1 | ) | ||||
Increase(decrease) in Cash and Cash Equivalents | (452.9 | ) | 60.5 | |||||
Cash and Cash Equivalents, Beginning of Period | 657.8 | 250.0 | ||||||
Cash and Cash Equivalents, End of Period | $ | 204.9 | $ | 310.5 | ||||
Free Cash Flow Computation | ||||||||
Operating Cash Flow | $ | 85.2 | $ | 60.6 | ||||
Less: capital and software expenditures | (14.5 | ) | (10.5 | ) | ||||
Free Cash Flow (before dividends) | $ | 70.7 | $ | 50.1 | ||||
Free cash flow is defined as cash flow from operations less capital expenditures; the company believes this is an important measure of its liquidity, as well as its ability to fund future growth and to provide a return to the shareowners.
The change in working capital is comprised of accounts receivable, inventory and accounts payable.
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THE STANLEY WORKS AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(Unaudited, Millions of Dollars)
FIRST QUARTER | ||||||||
2006 | 2005 | |||||||
NET SALES | ||||||||
Consumer Products | $ | 309.8 | $ | 257.2 | ||||
Industrial Tools | 451.0 | 349.3 | ||||||
Security Solutions | 207.9 | 189.8 | ||||||
Total | $ | 968.7 | $ | 796.3 | ||||
OPERATING PROFIT | ||||||||
Consumer Products | $ | 37.3 | $ | 41.0 | ||||
Industrial Tools | 28.7 | 36.8 | ||||||
Security Solutions | 27.1 | 24.8 | ||||||
Total | $ | 93.1 | $ | 102.6 | ||||
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