Stanley Black & Decker's CEO and President lauded the performance of the company's tools and engineered fastening units in its recent financials.
In the report, covering Q2 2017, Stanley boss James M. Loree praised the firm's "impressive performance" and noted organic growth from Tools and Storage of 8% and organic growth from Engineered Fastening of 6%.
Overall, net sales for the quarter were $3.2 billion, up 10% versus prior year, as positive volume (+8%) and acquisitions (+7%) more than offset divestitures (-3%), price (-1%) and currency (-1%).
Tools & Storage
In more detail, the Tools & Storage sector's net sales increased 17% versus 2Q 2016 as volume (+9%) and acquisitions (+11%) more than offset divestitures (-1%), price (-1%) and currency (-1%). Each region contributed to the 8% organic growth for the quarter with North America +9%, Europe +8%, and emerging markets +3%.
Share gains in North America were aided by a healthy U.S. tool market, SBD said, along with new products, including sales from the DEWALT FlexVolt system, and consistently strong commercial execution. Industrial channels within North America delivered high-single-digit growth reflecting improving market conditions and strength within MAC Tools.
Europe once again delivered share gains, with another quarter of above-market organic growth enabled by new products and successful commercial actions.
Organic growth within the emerging markets, led by Latin America, was driven by the continued success of our mid-price-point product releases, higher e-commerce volumes, and price. Overall Tools & Storage segment profit rate, excluding charges, was 18.1%, down from the record year ago rate of 18.8%, as benefits of volume leverage and productivity were more than offset by growth investments, price and commodity inflation.
Engineered Fastening
Industrial net sales increased 7% versus 2Q 2016 as volume (+9%) more than offset currency (-2%).
Engineering Fastening organic revenues increased 6% as strong automotive system shipments supporting new customer platforms and volume growth within general industrial markets more than offset declines within electronics. Infrastructure organic revenues were up 19% on expanded Hydraulic Tools volumes from successful commercial actions and improved market conditions, as well as higher Oil & Gas volumes from accelerated North American pipeline project and inspection activity. Overall Industrial segment profit rate was 19.4%, as volume leverage, productivity gains and cost control resulted in a 240 basis point expansion versus the 2Q’16 rate.
James M. Loree, President and CEO, commented: “Stanley Black & Decker continued to generate impressive results in the second quarter. Each of our businesses contributed to 7% organic revenue growth and the Company posted a strong 15.7% operating margin rate. Of particular note was the performance of Tools and Storage and Engineered Fastening, which generated organic growth of 8% and 6%, respectively, as well as Security North America, which built on the positive momentum of last quarter to deliver 4% organic growth. Both of our smaller Industrial businesses, Hydraulic Tools and Oil & Gas, also contributed with double-digit organic growth.
“Supplementing the solid organic performance, our recent acquisitions added 7 points of revenue growth. The integrations of both Newell Tools and the Craftsman brand are in full swing and on target. I am pleased with our team’s solid execution, and with our continued efforts to become known as a leading innovator, deliver top-quartile financial performance and elevate our commitment to social responsibility."
