Stanley Black & Decker Q3 Profit Rises; Updates FY14 Profit View - Quick Facts

(RTTNews) - Tool maker Stanley Black & Decker Inc. (SWK) reported that its third-quarter net earnings attributable to common shareowners rose to $236.7 million from the previous year's $166.0 million, with earnings per share improving to $1.47 from $1.04 in the same quarter last year.

Normalized earnings from continuing operations were $1.55 up from $1.39 per share in the previous year. Analysts polled by Thomson Reuters expected the company to report earnings of $1.44 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew to $2.902 billion from $2.758 billion in the previous year. Wall Street expected revenues of $2.87 billion.

The company reiterated the mid-point while tightening its previously communicated 2014 earnings per share outlook range to $5.52 - $5.58 on an adjusted basis or $5.40 - $5.46 on a GAAP basis. Analysts project annual earnings per share of $5.53.

The company said in July that it expected 2014 earnings per share to be in the range of $5.50 to $5.60 on an adjusted basis or $5.38 to $5.48 on a GAAP basis.

Donald Allan Jr., Senior Vice President and CFO, said "While it is premature to provide detail guidance for 2015 at this time, the continued strengthening of the U.S. dollar and slowing emerging market economic growth is a known headwind of approximately $50 - $75 million to 2015 operating margin growth. However, we have a demonstrated track record of responding to these types of currency and macro economic pressures with surgical cost reduction actions. In this regard, we are currently considering several initiatives which would largely, if not completely, offset these headwinds. Such actions, if taken, would likely require additional restructuring charges of $10 - $25 million in excess of our current 2014 estimate of $25 million."

The company said it remains committed to its capital allocation plan of modest debt deleveraging in 2014, returning up to $1 billion of capital to shareholders through 2015, and supporting a strong and growing dividend. These actions combined with near-term operational improvements are expected to improve cash flow return on investment by approximately 250 basis points through 2015.