Core Insights - The STANLEY® Pro's Perspective: Job Satisfaction Report indicates a positive outlook among residential professionals for 2025, despite challenges such as rising material costs and labor shortages [2][3][4] Industry Overview - A survey of 500 small repair and remodeling company owners and managers in the U.S. reveals that 89% feel confident about new job opportunities in 2025, with 69% reporting that clients are increasing project sizes [2][4][10] - The survey highlights that 93% of residential pros' clients are interested in high-end design projects, with top priorities including blending painted and finished wood surfaces (44%) and painted wood cabinetry in bold colors (39%) [7][10] Project Priorities - The most prioritized projects for clients in 2025 are kitchen and bathroom remodels, with 81% focusing on kitchen renovations and 79% on bathroom updates [8][10] - Other significant areas of focus include basements (64%) and living rooms (48%) [9][10] Job Satisfaction - A high level of job satisfaction is reported, with 85% of residential pros expressing fulfillment in their work and 82% feeling that financial benefits justify their efforts [13][14] - The survey indicates that 64% of clients show appreciation through referrals, and 81% of pros believe their autonomy is crucial for job satisfaction [11][14] Economic Context - Despite concerns regarding material (36%) and labor costs (30%), the overall sentiment remains optimistic among residential professionals [5][10]

Financial Performance - Net sales for Q1 2025 were $3,744.6 million, a decrease of 3.2% from $3,869.5 million in Q1 2024[2] - Gross profit increased to $1,120.8 million, representing 29.9% of net sales, compared to 28.6% in the previous year[2] - Net earnings for Q1 2025 were $90.4 million, significantly up from $19.5 million in Q1 2024, resulting in diluted earnings per share of $0.60[2] - Non-GAAP net earnings for Q1 2025 were $114.4 million, with a diluted earnings per share of $0.75 after adjustments[9] - Net earnings for Q1 2025 were $90.4 million, a significant increase from $19.5 million in Q1 2024, representing a growth of 362.3%[13] - Adjusted EBITDA for Q1 2025 was $361.8 million, up from $342.6 million in Q1 2024, reflecting an increase of 5.7%[13] Segment Performance - The Tools & Outdoor segment reported net sales of $3,280.9 million, slightly down from $3,284.6 million in Q1 2024, while segment profit increased to $289.2 million[8] - The Engineered Fastening segment saw a decline in net sales to $463.7 million from $584.9 million, with segment profit dropping to $39.0 million[8] - GAAP revenue growth for Stanley Black & Decker was -3% in Q1 2025, with organic growth at 1% after adjusting for currency and acquisitions[17] - The Engineered Fastening segment experienced a decline of 21% in GAAP revenue growth, with organic growth at -1%[17] Cash Flow and Dividends - Free cash flow before dividends for Q1 2025 was $(485.0) million, slightly improved from $(496.7) million in Q1 2024[6] - The company declared a dividend of $0.82 per share, up from $0.81 in the previous year[2] Assets and Liabilities - Total current assets rose to $7,009.1 million as of March 29, 2025, compared to $6,377.7 million at the end of 2024[4] - Total liabilities increased to $13,654.1 million from $12,528.5 million, with short-term borrowings of $1,135.2 million reported[4] Expenses and Charges - Selling, general and administrative expenses were $22.0 million in Q1 2025, up from $20.1 million in Q1 2024, reflecting an increase of 9.5%[15] - Interest expense decreased to $77.2 million in Q1 2025 from $87.9 million in Q1 2024, a reduction of 12.8%[13] - The company incurred a restructuring charge of $1.2 million in Q1 2025, compared to $15.0 million in Q1 2024, indicating a decrease of 92%[15] Other Financial Metrics - Non-GAAP adjustments before income taxes totaled $31.5 million in Q1 2025, down from $71.5 million in Q1 2024, indicating a reduction of 56%[15] - Supply Chain Transformation Costs in Q1 2025 amounted to $16.7 million, compared to $14.4 million in Q1 2024, showing an increase of 15.9%[15] - The company reported a gross profit of $16.7 million in Q1 2025, compared to $14.4 million in Q1 2024, marking a growth of 15.9%[15]

Leadership Transition - Stanley Black & Decker has appointed Christopher Nelson as the new President and CEO, effective October 1, 2025, succeeding Donald Allan, Jr. who has been CEO since July 2022 [1][5] - Donald Allan will transition to the role of Executive Chair of the Board, while Andrea Ayers will become Lead Independent Director [2][5] - This leadership change is part of a comprehensive succession planning process undertaken by the Board [1] Executive Background - Christopher Nelson has over 25 years of executive leadership experience and has been with Stanley Black & Decker since 2023 as COO and President of Tools & Outdoor [6] - Prior to joining Stanley Black & Decker, Nelson held leadership roles at Carrier, the U.S. Army, Johnson & Johnson, and McKinsey & Company [6] Company Performance Expectations - Stanley Black & Decker anticipates that its Second Quarter GAAP and Adjusted EPS performance will exceed its 2025 Planning Assumptions from the Q1 2025 earnings call [4][5]

Investor Presentation V e r s i o n 2 . 2 0 . 2 0 2 4 Contents | SWK Overview | Pages 4 – | 13 | | --- | --- | --- | | Tools & Outdoor | Pages 14 – | 24 | | Industrial | Pages 25 – | 29 | | Appendix | Pages 30 – | 37 | Contacts Dennis Lange Vice President, Investor Relations 860-827-3833 dennis.lange@sbdinc.com Christina Francis Director, Investor Relations 860-438-3470 christina.francis@sbdinc.com Christopher Capela Director, Investor Relations 860-827-5556 christopher.capela@sbdinc.com 1000 Stanley Drive ...

Financial Performance & Outlook - Stanley Black & Decker's (SWK) 2023 revenue was $15.8 billion[7] - The company is targeting ~$1.5 billion of pre-tax run-rate savings by the end of 2024[16] - The company is reiterating EPS guidance range of GAAP $1.60-$2.85 and adjusted $3.50-$4.50, and free cash flow $0.6B-$0.8B for 2024[29] - The company expects adjusted gross margin to increase sequentially in each half of 2024, planning for ~30% full year 2024 adjusted gross margin[35] - The company's 1Q'24 free cash flow outflow was ~$500 million[35] Business Segments - Tools & Outdoor segment accounted for $13.4 billion in revenue in 2023[7] - Industrial segment revenue was $2.4 billion in 2023[7] - In the Tools & Outdoor segment, Power Tools Group accounted for 48%, Hand Tools, Accessories & Storage for 30%, and Outdoor Power Equipment for 22% of the revenue[7] - Engineered Fastening accounted for 81% and Infrastructure for 19% of the Industrial segment revenue[7] Geographic Distribution - 62% of the company's revenue is generated in the U.S[10]

Financial Performance & Strategy - Stanley Black & Decker's (SWK) 2023 revenue was $15.8 billion[7] - The company is targeting ~$2 billion in pre-tax run-rate cost savings by the end of 2025[12, 14] - SWK is aiming for organic revenue growth of 2-3x the market rate[12] - The company is targeting an adjusted gross margin of 35%+ by 2025[12] - SWK expects free cash flow conversion to be 100%+[12] Segment Breakdown - Tools & Outdoor segment accounted for $13.4 billion of revenue in 2023[7] - Industrial segment revenue was $2.4 billion in 2023[7] - Within Tools & Outdoor, Power Tools Group contributed 48%, Hand Tools, Accessories & Storage 30%, and Outdoor Power Equipment 22% of the revenue[7] Geographic Distribution - 62% of the company's revenues are generated in the U S [10] - Europe accounts for 16%, Emerging Markets 12%, and Rest of World (ROW) 10% of the revenues[10] 2024 Guidance - The company anticipates organic revenue to be approximately (0 5%) year-over-year +/- 130 bps in 2024[28] - Adjusted EPS for 2024 is projected to be $3 70-$4 50, and free cash flow is expected to be $650 million-$850 million[28]

Core Insights - The article emphasizes the importance of understanding that past performance does not guarantee future results, highlighting the need for careful analysis before making investment decisions [2][3] Group 1 - The article discusses the role of analysts in providing insights and opinions on various companies and industries, noting that these views may not reflect the overall stance of the publication [3] - It mentions that the information presented is believed to be factual and up-to-date, but does not guarantee accuracy, indicating the necessity for investors to conduct their own research [2][3] - The article clarifies that no specific investment recommendations are being made, and it is not an offer to buy or sell securities [2][3] Group 2 - The disclosure states that the authors have no financial positions in the companies mentioned, which aims to eliminate potential conflicts of interest [1] - It highlights that the opinions expressed are subject to change and may not represent the views of the publication as a whole [3] - The article notes that the authors include both professional and individual investors, some of whom may not be licensed or certified [3]

Core Viewpoint - Stanley Black & Decker will host its second quarter 2025 earnings webcast on July 29, 2025, at 8:00 AM ET, with a news release detailing financial results to be distributed prior to market opening on the same day [1][2]. Company Overview - Stanley Black & Decker, founded in 1843 and headquartered in the USA, is a global leader in tools and outdoor products, employing approximately 48,000 individuals worldwide [3]. - The company produces a range of innovative products including power tools, hand tools, storage solutions, digital jobsite solutions, outdoor products, and engineered fasteners, catering to builders, tradespeople, and DIY enthusiasts [3]. - Its portfolio includes well-known brands such as DEWALT®, CRAFTSMAN®, STANLEY®, BLACK+DECKER®, and Cub Cadet® [3].

Core Insights - Stanley Black & Decker, Inc. (SWK) has underperformed in operational performance, facing challenges from business weaknesses, high debt, and rising operational expenses [1][8]. Group 1: Business Performance - The company is experiencing significant weakness in its Engineered Fastening segment, particularly in the automotive market, leading to a 20.7% year-over-year revenue decline to $463.7 million in Q1 2025 [3][8]. - The divestiture of the infrastructure business has negatively impacted sales in the Engineered Fastening segment, although there is some strength in aerospace and general industrial markets [3]. Group 2: Cost and Expenses - Stanley Black & Decker is facing escalating costs, with SG&A expenses rising 1.8% year-over-year to $867 million, and as a percentage of net sales, it increased by 120 basis points to 23.2% [4]. - The cost of sales also increased, up 130 basis points to 29.9% of net sales, indicating pressure on margins and profitability [4]. Group 3: Financial Position - The company's long-term debt stands at $4.8 billion, with current maturities totaling $849.4 million, raising concerns about financial obligations and profitability [9]. - Cash and cash equivalents are low at $344.8 million, which is not sufficient given the high debt levels [9]. Group 4: Market Impact - Foreign currency translation negatively impacted revenues by 2% in Q1 2025, highlighting the risks associated with global operations [10]. - Earnings estimates have been revised down significantly, with the 2025 consensus estimate dropping from $5.14 to $4.36 per share due to seven downward revisions [11].

Core Viewpoint - Multiple well-known companies in the U.S. are implementing price increases in May, indicating a trend of rising costs across various sectors. Group 1: E-commerce and Retail - E-commerce giants Temu and Shein issued nearly identical price increase notifications [1] - Retail giants Walmart and Macy's announced price hikes in May [1] - Toy manufacturer Mattel announced price increases for certain products in the U.S. in early May [1] Group 2: Apparel and Footwear - Nike announced price increases for athletic shoes priced between $100 and $150, with a maximum increase of $5 [1] - Apparel brand Ralph Lauren plans to raise prices more significantly than initially planned to offset tariff impacts [1] Group 3: Technology and Automotive - Microsoft raised the suggested retail prices for its Xbox consoles and controllers globally in early May [1] - Ford increased the prices of three models produced in Mexico, with the highest increase reaching $2,000 [1] - Subaru announced price hikes for several models, effective in June [1] Group 4: Tools and Consumer Goods - Tool manufacturer Stanley Black & Decker raised prices in April and plans to increase them again in the third quarter [1] - Procter & Gamble indicated that it may need to pass price increases onto consumers, with potential price hikes visible as early as July [1]