Fourth Quarter And Full Year 2023 Overview F e b r u a r y 1 , 2 0 2 4 StanleyBlack&Decker For those who make the world." Participants Don Allan President & CEO Chris Nelson COO, Executive Vice President And President, T&O Pat Hallinan Executive Vice President, CFO Dennis Lange Vice President, Investor Relations 4Q And FY 2023 Earnings Call | 2 Cautionary Statement | --- | --- | |----------------------------------------------------------------------------------------|-------| | | | | Certain Statements Cont ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from [ ] to [ ] Commission File Number 001-05224 STANLEY BLACK & DECKER, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) CT 06-0548860 (STATE OR OTHER JURISDI ...

O c t o b e r 2 7 , 2 0 2 3 3Q 2023 Segment Overview | --- | --- | --- | --- | --- | --- | --- | --- | --- | |-----------------|-------|---------------|-------|-------|----------------------------|-------|-----------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | $M | Revenue | | | ...

Financial Data and Key Metrics Changes - Revenue for the third quarter was $4 billion, down from the prior year primarily due to lower Outdoor and DIY volume [8][11] - Adjusted gross margin rose to 27.6%, a 400-basis-point sequential improvement and 290 basis points favorable compared to last year [32][53] - Adjusted diluted EPS for the quarter was $1.05, better than planned, leading to an increase in full-year adjusted diluted EPS guidance to a range of $1.10 to $1.40 [11][56] Business Line Data and Key Metrics Changes - Industrial revenue declined 4% year-over-year, impacted by lower volume and a 3-point impact from the divestiture of the Oil and Gas business [12] - Engineered Fastening organic revenues increased by 6%, with aerospace growth of 29% and auto growth of 9% [13] - Tools and Outdoor revenue was $3.4 billion, down 5% organically due to lower consumer Outdoor and DIY market demand, with Outdoor down 23% [39] Market Data and Key Metrics Changes - Emerging markets grew mid-single digits organically, excluding the impact from the exit of the Russia business, with Latin America showing notable strength [17] - U.S. retail point-of-sale for Tools and Outdoor products remained above pre-pandemic levels, supported by professional demand [31][69] - European organic revenue was down 3%, with double-digit growth in the U.K. and low single-digit growth in the Nordics [40] Company Strategy and Development Direction - The company is focused on delivering best-in-class product innovation, implementing cost efficiency measures, and driving share gain in core markets [7][10] - A strategic business transformation is underway, with a goal to restore adjusted gross margins to historical levels of 35% or more [45][50] - The company aims to achieve organic revenue growth of 2 to 3 times the market [22][55] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate uncertain market conditions and improve margins [10][34] - The outlook for 2024 anticipates continued gross margin expansion and cash generation, with a focus on investing for growth [92][106] - Management acknowledged the dynamic market environment, with potential impacts from consumer behavior shifts and macroeconomic factors [140][153] Other Important Information - The Global Cost Reduction Program delivered $215 million of pretax run rate savings in the quarter, on track for $2 billion run rate savings by the end of 2025 [9][78] - The company reduced inventory by approximately $300 million in the quarter, contributing to $360 million of free cash flow generation [33][80] - The company is committed to investing $30 million to grow trade skills by 2027 through initiatives like the DEWALT Grow the Trades Grant [20] Q&A Session Summary Question: Insights on margins and EPS guidance - Management indicated that gross margins improved due to cost savings from the transformation program, with expectations for continued improvement [62][128] Question: Reinvestment for growth and promotional activities - The company plans to reinvest in growth, focusing on professional end-user products and returning to traditional promotional levels [96][97] Question: Updated guidance and factors driving performance - The strong third quarter performance was driven by gross margin strength and effective SG&A management, with a reiteration of free cash flow guidance [100][102] Question: Market share growth in a flat macro environment - Management believes they can grow market share even in a mixed macro environment, focusing on key brands and strategic investments [108][138] Question: Pricing dynamics and competitive environment - The company noted disciplined pricing in the market, with no significant changes in competitive dynamics affecting their strategy [163][165]

Financial Data and Key Metrics Changes - The company reported a second quarter revenue of $4.2 billion, down from the previous year due to lower consumer Outdoor and DIY volume, as rising interest rates have tempered consumer spending [70] - Adjusted gross margin for the quarter was 23.6%, a sequential improvement of 50 basis points, marking the second consecutive quarter of gross margin expansion [70][51] - The company narrowed its full-year adjusted diluted EPS guidance range to $0.70 to $1.30 from a previous range of zero to $2 [85] Business Line Data and Key Metrics Changes - Tools and Outdoor total revenue was $3.5 billion, down 5% organically versus the prior year, with favorable price realization offset by volume decline [32] - The Industrial business segment achieved 3% organic growth in the quarter, with total segment revenue declining 5% versus 2Q 2022 due to price realization being offset by last year's oil and gas divestiture and currency effects [43] - The hand tools business was flat organically versus the prior year, overcoming softer DIY volume with international growth and strength in certain categories [42] Market Data and Key Metrics Changes - North America experienced mid-single-digit organic revenue decline, influenced by lower consumer Outdoor and DIY tool demand as well as modest customer destocking [41] - European revenue was down 1% organically, with high-single-digit organic growth in the UK and Southern regions [73] - Emerging markets' performance was down 3% organically, but excluding the impacts from the Russian business exit, remaining countries showed high-single-digit organic growth, particularly in Brazil [73] Company Strategy and Development Direction - The company is focused on transforming its operations to accelerate market share gains and drive consistent organic growth, with a commitment to return value to shareholders through cash dividends [11][38] - The strategy includes prioritizing cash flow generation, inventory optimization, and advancing innovation, electrification, and global market penetration [76] - The company aims to achieve adjusted gross margins of 35% plus by 2025, with ongoing cost reduction initiatives expected to deliver $1 billion in annualized savings by the end of 2023 [50][84] Management's Comments on Operating Environment and Future Outlook - Management noted that the outdoor season was challenging, with notable softness in point-of-sale and replenishment, particularly for higher-priced retail products [1] - The company expects continued strength in professional demand, with a potential for stronger performance in the back half of the year, despite ongoing customer destocking in certain segments [4] - Management expressed cautious optimism regarding the demand environment, indicating that while there are pressures, there are also positive trends emerging, particularly in professional markets [19][40] Other Important Information - The company reduced inventory by nearly $400 million in Q2, bringing the total reduction to $1.4 billion since mid-2022 [30] - The introduction of new products, such as the DEWALT 20-volt MAX XR Brushless Cordless Rivet Tools, is part of the company's strategy to enhance its product offerings [2] - The company is actively managing channel inventories, with expectations of modest headwinds throughout 2023 [40] Q&A Session Summary Question: Can you provide insights on the competitive environment and channel inventory dynamics? - Management acknowledged market volatility but noted that trends in point-of-sale have been positive, with July showing a good start to the quarter. They emphasized the need to monitor consumer spending shifts [19] Question: What are the expectations for gross margin improvement from the first half to the second half? - Management indicated that the improvement in gross margin is expected to be driven by the roll-off of high-cost inventory and ongoing cost savings from transformation initiatives [113] Question: How does the company plan to balance investments for growth with maintaining profitability? - Management highlighted the importance of investing in key areas such as innovation and market activation while ensuring that these investments align with long-term growth objectives [126]

Financial Data and Key Metrics Changes - The first quarter revenue was $3.9 billion, down from the previous year, primarily due to lower consumer and DIY volume, currency impacts, and the divestiture of the oil and gas business [33][81] - Adjusted EPS for the period was a loss of $0.41, significantly impacted by inventory reduction efforts [7] - Adjusted gross margins improved to approximately 23%, up 360 basis points sequentially from Q4 2022 [88] Business Segment Performance - Tools and Outdoor revenue was $3.3 billion, a decline of 13% due to lower consumer demand and a slow start to the retail outdoor season [8] - The industrial business experienced 3% organic growth, with total segment revenue declining 5% due to price realization being offset by divestitures and currency impacts [9] - Power tools and hand tools saw organic declines of 12% and 6% respectively, while the outdoor business declined 16% [35] Market Data and Key Metrics Changes - North America and Europe both experienced a 12% organic decline, while emerging markets saw a 2% decline, but excluding Russia, there was 6% organic growth in the region [81] - The retail point of sale for tools and outdoor products remained above 2019 levels, supported by price and healthy professional demand [107] Company Strategy and Industry Competition - The company is focused on cash flow generation through inventory reduction, targeting $750 million to $1 billion in inventory reduction for the year [15][80] - Strategic investments are being made in innovation and electrification to maintain market leadership [85] - The company is streamlining operations and reducing SKUs, with 60,000 SKUs approved for reduction, of which 16,000 are now decommissioned [111] Management's Comments on Operating Environment and Future Outlook - Management reiterated a full-year adjusted EPS guidance range of $0 to $2, with free cash flow expected to be between $500 million and $1 billion [80] - The company is planning for a range of demand scenarios, balancing potential continuation of current trends with the possibility of improvement or further slowdown [80] - Management expressed confidence in the transformation efforts and the potential for improved financial benefits in the future [19][91] Other Important Information - The global cost reduction program delivered $230 million in pre-tax run rate savings this quarter, with a total of $430 million captured since the program's launch [6][12] - The company is on track to achieve $1 billion in run rate savings by the end of 2023 and $2 billion by 2025 [12] Q&A Session Summary Question: What drove the upside on the operating margins in Q1? - Management indicated that the operating margins were positively impacted by effective cost controls and inventory reduction strategies [128] Question: How does the company view the pricing environment for the rest of the year? - The pricing environment is expected to remain stable, with no additional price increases anticipated [24] Question: What is the outlook for the professional segment in the second half of the year? - The professional segment is expected to remain healthy, with continued strength anticipated [62] Question: How is the company managing inventory levels in a slow demand environment? - The company is being patient with inventory management, focusing on strategic promotions to clear excess inventory while maintaining a disciplined approach to pricing [72]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ___________ Commission File Number 001-05224 STANLEY BLACK & DECKER, INC. (Exact Name Of Registrant As Specified In Its Charter) Connecticut 06-0548860 (State ...

Financial Performance & Outlook - Stanley Black & Decker's FY22 revenue reached $16.9 billion, an 11% increase year-over-year, driven by Outdoor Power Equipment acquisitions, Industrial segment growth, and price realization[5] - The company's global cost reduction program delivered $200 million in pre-tax savings in the second half of 2022[5,17] - Fourth quarter inventory reduction of $500 million supported $520 million in free cash flow generation and contributed to $0.5 billion of debt reduction[5,25] - Full year adjusted diluted EPS was $4.62[5] - The company is guiding for a 2023 full year adjusted diluted EPS of $0.00 to $2.00, with free cash flow expected to approximate $0.5 billion to $1 billion[5,40] Strategic Initiatives - Stanley Black & Decker aims to achieve ~$2 billion in cost savings over three years through complexity reduction[8,19] - The company plans to invest $300 million - $500 million in core growth areas, including innovation and electrification[8] - Supply chain transformation is expected to yield $1.5 billion in savings by 2025, enabling adjusted gross margins of 35% or higher[18] - The company is targeting a $0.5 billion inventory decline in the first half of 2023, with the majority of the reduction in the second quarter[26] Segment Performance (Q4 2022) - Tools & Outdoor revenue was $3.372 billion, flat compared to Q4 2021, with an operating margin of 1.0%[21] - Industrial revenue was $604 million, a 1% decrease compared to Q4 2021, with an operating margin of 11.5%[21]

Stanley Black & Decker, Inc. (NYSE:SWK) Q4 2022 Earnings Conference Call February 2, 2023 8:00 AM ET Company Participants Dennis Lange - Vice President-Investor Relations Don Allan - President & Chief Executive Officer Corbin Walburger - Vice President & Interim Chief Financial Officer Conference Call Participants Julian Mitchell - Barclays Tim Wojs - Baird Nigel Coe - Wolfe Research Mike Rehaut - JPMorgan Rob Wertheimer - Melius Research Chris Snyder - UBS Dan Oppenheim - Credit Suisse Nicole DeBlase - Deu ...

Company Overview - Stanley Black & Decker's 2021 revenue was $153 billion, with a pro forma revenue of $181 billion, including Tools & Outdoor at $156 billion and Industrial at $25 billion[6] - The company's market capitalization was $113 billion, with a cash dividend yield of 42%[6] - Approximately 60% of the company's revenues were generated in the U S [12] Financial Performance and Guidance - The company expects low double-digit total revenue growth for 2022[30] - The company anticipates adjusted EPS of $415 to $465 for 2022[30] - The company expects fourth-quarter free cash flow to approximate $03 to $06 billion[31, 33] Cost Reduction and Transformation - The company plans to reduce complexity and aims for approximately $2 billion in cost savings by 2025, with $1 billion annualized by 2023[14, 16] - Supply chain transformation is expected to contribute $15 billion to the total cost savings by 2025, with $05 billion by 2023[16] - SG&A initiatives are projected to save $05 billion by 2023[19] Tools & Outdoor Segment - The Tools & Outdoor segment's 2021 revenues were $128 billion, with a pro forma revenue of $156 billion[6, 97] - The segment experienced 20% organic growth in 2021[100] - The company has integrated acquisitions worth over $5 billion in the Tools & Outdoor segment[107]