NEW BRITAIN, Conn.,
May 16, 2019 /PRNewswire/
-- Stanley Black & Decker (NYSE: SWK) provided a strategic
update today during its 2019 Investor Day.
Strategic Update:
During today's event, Stanley
Black & Decker's leadership team provided an update on
its business segments, as well as the growth catalysts and
transformation initiatives that are critical to achieving the
Company's long-term vision.
Stanley Black & Decker's
President and CEO James M. Loree
commented, "Our vision is to become known as one of the world's
most innovative companies, continue to deliver top-quartile
performance, and continuously elevate our commitment to corporate
social responsibility. We are operating at a time of rapid,
disruptive technological change, and we are focused on positioning
our business to successfully capitalize on the resulting
opportunities."
Key messages from the day included:
- Stanley Black & Decker is a
performance-driven organization powered by innovation, a robust
operating system, SFS 2.0, and a strong value creation
framework. The company operates strong businesses across
diverse, global markets.
- Several catalysts are positioning the company for growth and
margin expansion, including revenue generating initiatives such as
Craftsman, new core and breakthrough innovations, Lenox and Irwin
revenue synergies, e-commerce, emerging markets and M&A.
In addition, the Company announced a technology-enabled
transformative program focused on margin resiliency that is
expected to generate $300 -
$500 million in cost savings over a
3-year period.
- Stanley Black & Decker is
building a unique and powerful innovation ecosystem enabling a
robust pipeline of new innovations to supplement organic growth and
provide a broad and deep window into the technological forces that
are shaping and redefining business models across industries.
- The Company reinforced its commitment to corporate social
responsibility and diversity and inclusion, emphasizing its
positive impact on society and the company's performance.
"The growth catalysts we see today will have an even greater
impact when combined with our SFS 2.0 operating system and an
integrated innovation ecosystem. Our forward momentum is
tangible and the Company's positioning for future growth and
success has never been better. With our relentless focus on
strong cash flow generation and operating margin expansion, we are
prepared to tackle whatever external forces come our way," added
Loree.
2019 Guidance:
During today's event, the Company also reaffirmed its updated
full year 2019 guidance as provided on April
24, 2019 and discussed the impact of certain recent tariff
announcements. The Company continues to expect its 2019 EPS
outlook to be $7.50 - $7.70 on a GAAP basis and to be $8.50 - $8.70 on an
adjusted basis. The Company also reiterated its free cash
flow conversion estimate of approximately 85% - 90%. This
includes the implementation of a 25% tariff on Section 301 List
3.
The difference between 2019 GAAP and Adjusted EPS guidance is
$1.00, consisting of
acquisition-related and other charges. These forecasted
charges primarily relate to deal and integration costs,
restructuring, Security business transformation and margin
resiliency initiatives, and inventory step-up amortization.
Three-Year Financial Targets:
In addition, Stanley Black &
Decker provided three-year financial targets as follows:
- Revenue: 4% - 6% Organic Growth; Total Growth Enhanced By
Acquisitions
- Financial Performance:
-
- 50+ Bps Annual Operating Margin Rate Improvement
- 7-9% EPS Growth; 10-12% With Acquisitions
- Achieving 10+ Working Capital Turns
- Free Cash Flow ~100% Of Net Income
- Cash Flow Return On Investment 12-15%
- Continued Dividend Growth
- Strong Investment Grade Credit Rating
Donald Allan, Jr., Executive Vice
President and CFO, commented, "Stanley
Black & Decker's outlook for 2019 remains positive, as
we successfully leverage our strong organic growth, pricing actions
and the $250 million cost reduction
program to overcome the impact from 2018 carry-over
headwinds. We will continue to leverage our SFS 2.0
operating system and the new margin resiliency program discussed
today to help us navigate unforeseen external volatility and
deliver consistent margin expansion. We are confident we have
positioned the Company to deliver sustained above-market growth
with operating leverage, strong free cash flow conversion and
top-quartile shareholder returns over the long-term."
An audio webcast of the event will be available in the
"Investors" section of the company's website at
www.stanleyblackanddecker.com and will be available for 90
days.
Stanley Black & Decker, an
S&P 500 company, is a diversified global provider of hand
tools, power tools and related accessories, electronic security
solutions, healthcare solutions, engineered fastening systems, and
more. Learn more at www.stanleyblackanddecker.com.
Stanley Black & Decker
Investor Contacts
Dennis Lange
Vice President, Investor Relations
(860) 827-3833
dennis.lange@sbdinc.com
Cort Kaufman
Director, Investor Relations
(860) 515-2741
cort.kaufman@sbdinc.com
Shannon Lapierre
Vice President, Communications & Public Relations
(860) 827-3575
shannon.lapierre@sbdinc.com
CAUTIONARY STATEMENTS
Under the Private Securities Litigation Reform Act of 1995
This document contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
All statements other than statements of historical fact are
"forward-looking statements" for purposes of federal and state
securities laws, including any projections or guidance of earnings,
revenue or other financial items; any statements of the plans,
strategies and objectives of management for future operations; any
statements concerning proposed new products, services or
developments; any statements regarding future economic conditions
or performance; any statements of belief; and any statements of
assumptions underlying any of the foregoing. Forward-looking
statements may include, among other, the words "may," "will,"
"estimate," "intend," "continue," "believe," "expect," "anticipate"
or any other similar words.
Although the Company believes that the expectations reflected in
any of its forward-looking statements are reasonable, actual
results could differ materially from those projected or assumed in
any of its forward-looking statements. The Company's future
financial condition and results of operations, as well as any
forward-looking statements, are subject to change and to inherent
risks and uncertainties, such as those disclosed or incorporated by
reference in the Company's filings with the Securities and Exchange
Commission.
Important factors that could cause the Company's actual results,
performance and achievements, or industry results to differ
materially from estimates or projections contained in its
forward-looking statements include, among others, the following:
(i) successfully developing, marketing and achieving sales from new
products and services and the continued acceptance of current
products and services; (ii) macroeconomic factors, including global
and regional business conditions (such as Brexit), commodity
prices, inflation, and currency exchange rates; (iii) laws,
regulations and governmental policies affecting the Company's
activities in the countries where it does business, including those
related to tariffs, taxation, and trade controls, including section
301 tariffs and section 232 steel and aluminum tariffs; (iv) the
economic environment of emerging markets, particularly Latin America, Russia, China
and Turkey; (v) realizing the
anticipated benefits of mergers, acquisitions, joint ventures,
strategic alliances or divestitures; (vi) pricing pressure and
other changes within competitive markets; (vii) availability and
price of raw materials, component parts, freight, energy, labor and
sourced finished goods; (viii) the impact the tightened credit
markets may have on the Company or its customers or suppliers; (ix)
the extent to which the Company has to write off accounts
receivable or assets or experiences supply chain disruptions in
connection with bankruptcy filings by customers or suppliers; (x)
the Company's ability to identify and effectively execute
productivity improvements and cost reductions; (xi) potential
business and distribution disruptions, including those related to
physical security threats, information technology or cyber-attacks,
epidemics, sanctions or natural disasters; (xii) the continued
consolidation of customers, particularly in consumer channels;
(xiii) managing franchisee relationships; (xiv) the impact of poor
weather conditions; (xv) maintaining or improving production rates
in the Company's manufacturing facilities, responding to
significant changes in product demand and fulfilling demand for new
and existing products; (xvi) changes in the competitive landscape
in the Company's markets; (xvii) the Company's non-U.S. operations,
including sales to non-U.S. customers; (xviii) the impact from
demand changes within world-wide markets associated with
homebuilding and remodeling; (xix) potential adverse developments
in new or pending litigation and/or government investigations; (xx)
changes in the Company's ability to obtain debt on commercially
reasonable terms and at competitive rates; (xxi) substantial
pension and other postretirement benefit obligations; (xxii)
potential environmental liabilities; (xxiii) work stoppages or
other labor disruptions; and (xxiv) changes in accounting
estimates.
Additional factors that could cause actual results to differ
materially from forward-looking statements are set forth in the
Annual Report on Form 10-K and in the Quarterly Report on Form
10-Q, including under the heading "Risk Factors," "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" and in the Consolidated Financial Statements and the
related Notes.
Forward-looking statements in this press release speak only as
of the date hereof, and forward-looking statements in documents
attached that are incorporated by reference speak only as of the
date of those documents. The Company does not undertake any
obligation to update or release any revisions to any
forward-looking statement or to report any events or circumstances
after the date hereof or to reflect the occurrence of unanticipated
events, except as required by law.
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SOURCE Stanley Black &
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