Stanley Black & Decker battles Q3 inflation, tariffs
Stanley Black & Decker reported third quarter net sales of $3.5 billion, a 4% increase from third quarter 2017 net sales of $3.4 billion.
The New Britain, Conn.-based tools, storage, and security products manufacturer also reported third quarter net earnings declined 9.5% to $248.3 million from net earnings of $274.5 million in the same period last year.
In a statement issued this morning, Stanley Black & Decker said, “volume leverage, productivity and price were more than offset by external headwinds, including commodity inflation, foreign exchange, and tariffs.”
The manufacturer also said it restructuring charges for the quarter were $21.8 million. Excluding certain one-time charges, restructuring was $11.7 million for the quarter compared to $11.4 million in the third quarter a year ago.
Stanley Black & Decker announced it is now taking cost-cutting measures of $250 million in addition to pricing actions designed to preserve earnings in 2019. The cost actions will be complete by the end of 2018 and the majority of the pricing actions will be implemented in early first quarter 2019, according to James Loree, CEO and president of Stanley Black & Decker.
"Our seasoned, capable management team has stepped up with agility and speed to address these external issues which could have otherwise potentially cast a cloud over this outstanding growth story,” Loree said.
Tools and storage net sales increased 3% during the quarter due to a volume increase of more than 5% and a price increase of more than 1%. Industrial net sales increased 10%, partially due to acquisitions while security net sales increased 1%.
Taxes, of course, played a role in the earnings performance. Stanley faced a tax rate of 18.6%. Excluding charges, the company’s tax rate was 19.5% versus 23% in the third quarter of 2017. The company reported that the drop in its tax rate reflected the benefits from U.S. tax legislation and the effective settlement of a tax audit during the quarter.
Stanley Black & Decker subsidiary Stanley Tools also announced Thruesday that it has signed an exclusive agreement with The Home Depot. The deal includes in-store and online sales, along with the retailer becoming the exclusive retailer of Stanley’s Fatmax heavy duty tool brand.
The New Britain, Conn.-based tools, storage, and security products manufacturer also reported third quarter net earnings declined 9.5% to $248.3 million from net earnings of $274.5 million in the same period last year.
In a statement issued this morning, Stanley Black & Decker said, “volume leverage, productivity and price were more than offset by external headwinds, including commodity inflation, foreign exchange, and tariffs.”
The manufacturer also said it restructuring charges for the quarter were $21.8 million. Excluding certain one-time charges, restructuring was $11.7 million for the quarter compared to $11.4 million in the third quarter a year ago.
Stanley Black & Decker announced it is now taking cost-cutting measures of $250 million in addition to pricing actions designed to preserve earnings in 2019. The cost actions will be complete by the end of 2018 and the majority of the pricing actions will be implemented in early first quarter 2019, according to James Loree, CEO and president of Stanley Black & Decker.
"Our seasoned, capable management team has stepped up with agility and speed to address these external issues which could have otherwise potentially cast a cloud over this outstanding growth story,” Loree said.
Tools and storage net sales increased 3% during the quarter due to a volume increase of more than 5% and a price increase of more than 1%. Industrial net sales increased 10%, partially due to acquisitions while security net sales increased 1%.
Taxes, of course, played a role in the earnings performance. Stanley faced a tax rate of 18.6%. Excluding charges, the company’s tax rate was 19.5% versus 23% in the third quarter of 2017. The company reported that the drop in its tax rate reflected the benefits from U.S. tax legislation and the effective settlement of a tax audit during the quarter.
Stanley Black & Decker subsidiary Stanley Tools also announced Thruesday that it has signed an exclusive agreement with The Home Depot. The deal includes in-store and online sales, along with the retailer becoming the exclusive retailer of Stanley’s Fatmax heavy duty tool brand.