Revenue rises in Q2 for Stanley Black & Decker

Stanley Black & Decker revenues rose 2% to $2.9 billion in Q2 2016, with 4% organic growth.

The outgoing CEO noted that there could be a potential fall out from Brexit and a challenging operating environment, but said innovation and organisational agility would help the firm through.

The Q2 period saw Stanley Black & Decker announced its ‘game changer’ Dewalt Flexvolt Battery System, which provides up to 120 Volts in cordless tools.

CEO of 12 years John F Lundgren will retire from the role, with James M Loree succeeding as President and CEO on 1 August 2016. Lundgren will continue as Chairman of the Board until the end of the year and then Special Adviser through 30 April 2017.

The company owns Stanley, DeWalt, Black+Decker, Porter and Cable and Mac Tools, among others.

Current Chairman and CEO Lundgre said: “Our results for the quarter as well as the first half of the year demonstrate the successful execution of our strategy to leverage our world-class franchises and brands to deliver above-market organic growth, meaningful operating leverage and strong free cash flow conversion, while maintaining a balanced capital allocation approach, creating sustainable value for our shareholders.

“Although we continue to face a challenging operating environment, including the potential fall-out from Brexit, we remain confident in our ability to navigate through such conditions given our robust innovation, organisational agility and our increasing capability to consistently execute at a high level.”

Tools & Storage net sales increased 5% versus 2Q’15 as volume (+7%) and price (+1%) more than offset unfavorable currency (-3%).

All regions posted solid organic growth with North America +7%, Europe +14%, and emerging markets +4%. Organic growth momentum in Europe continued with most markets up double digits, as new products, targeted growth investments and an expanded retail footprint generated share gains across the region. Organic growth within the emerging markets, which continue to remain challenging, reflects successful commercial execution surrounding our mid-price-point product releases as well as regional pricing actions. Overall Tools & Storage segment profit rate was 18.8%, a post-merger record, up from the 2Q’15 rate of 16.4%, as volume leverage, price, productivity, cost management and lower commodity prices more than offset currency.

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