Stanley Black & Decker reports Q1 sales

Stanley Black & Decker reported first quarter net sales of $1.3 billion, up 38% versus prior year due to the inclusion of Black & Decker's results for the roughly one-month period since the two companies merged.

Excluding the Black & Decker businesses, the rate improved to 40.8%, a 1Q record for legacy Stanley.

"Since the close of our merger with Black & Decker, the execution of our integration plans has progressed smoothly and we are pleased with our initial success in realizing the operating and financial benefits that made this combination so compelling," said Stanley Black & Decker's President and CEO, John F. Lundgren. "We continue to further develop our cost synergy plans and remain confident in meeting or exceeding our original estimate of $350 million in cost synergies."

The CDIYsegment grew revenues 85% to $561 million; the Security segment revenues grew by 11% to $414 million; and the Industrial segment grew 22% to $287 million.

Given that Stanley Black & Decker's first quarter results reflect only the Black & Decker stub period, the company included the following commentary in order to provide a sense of how the legacy Black & Decker businesses performed for the entire quarter. (The Price Pfister business was included in the Hardware & Home Improvement Segment for purposes of this discussion).

Organic sales in the legacy Power Tools and Accessories segment were up slightly over 1%. Operating margins improved to approximately 10%, up from approximately 4% in 1Q'09 due to successful productivity initiatives, favorable mix and the impact of restructuring actions.

In the U.S. Industrial Products Group, sales increased modestly due to higher sales of cordless and commercial products. Sales increased at a high single-digit rate in the U.S. Consumer Products Group due, in part, to higher sales of the Tradesman line and the outdoor product portfolio. Excluding the positive impact of currency, sales for the entire legacy PT&A segment rose approximately 3% in Europe, 11% in Latin America and 13% in Asia.

Sales in the legacy Hardware and Home Improvement segment increased approximately 12% for the quarter. In the U.S. lockset business, sales increased approximately 14% due to a successful launch of new mid price point products. Sales in the Price Pfister business increased approximately 9%. The legacy segment's operating margin increased to 17% from the 1Q'09 margin of 4%.

In the legacy Fastening and Assembly Systems segment, organic sales increased approximately 30% for the quarter. Sales to the global automotive industry increased amidst a surge in global automotive production with a favorable mix toward mid- and full- size vehicles particularly in Europe. Sales increased in the industrial business as global industrial production continued to rise. The legacy segment's operating margin increased to approximately 14% from 2% in 1Q'09 with the businesses posting double-digit profitability in all regions of the world as the 2009 restructuring actions continued to take hold.