Tough quarter for Black & Decker
Black & Decker, one of the industry’s leading manufacturers of power tools and household appliances, reported earnings of $43.7 million for its fourth fiscal quarter, a 77 percent fall from earnings of $187.4 million in the same period of 2007.
Sales for the quarter, which ended Dec. 31, 2008, were $1.37 billion, compared to $1.65 billion in the corresponding period of the previous year. This reflects a 17 percent decrease.
For the full year, net earnings for Black & Decker were $293.6 million versus $518.1 million in 2007.
Every division in the Towson, Md.-based company experienced declines in 2008, including power tools and accessories (10 percent); hardware and home improvement (11 percent); and fastening and assembly systems (13 percent). The company blamed the weak sales on a number of factors: slowing markets in residential and commercial construction, lower consumer spending and inventory reduction by retailers.
In response, the company cut 1,200 jobs during the quarter. In a prepared statement, chairman and CEO Nolan Archibald said the company expects demand “will weaken further in 2009” in most of Black & Decker’s markets. The company sells products in Europe, Latin America and Asia, as well as North America.
“We anticipate a double-digit rate of organic sales decline for the first three quarters of the year, as well as an unfavorable impact from foreign currency translation,” Archibald said.
