Stanley Black & Decker Reports $2 Billion Cost Reduction Program

Stanley Black & Decker has released its latest 10-K report, providing a comprehensive overview of its business operations. The company, headquartered in New Britain, Connecticut, operates in the tools and storage, as well as industrial sectors, spanning across the United States, Canada, Europe, and Asia. The Tools & Storage segment offers a range of professional and consumer products, including cordless and corded electric power tools, lawn and garden products, hand tools, and storage products. The Industrial segment provides engineered fastening systems, pipeline inspection services, hydraulic tools, and heavy equipment attachment tools to various industries. The company has undergone a significant transformation, including a $2.0 billion Global Cost Reduction Program through 2025, with strategic objectives focused on innovation, streamlining, and simplifying the organization, returning adjusted gross margins to historical levels, and prioritizing cash flow generation and inventory optimization.

The company has made notable financial moves, including the repurchase of 12,645,371 shares of its common stock for approximately $2.3 billion in the first quarter of 2022. Additionally, it has entered into a definitive agreement to sell its Infrastructure business to Epiroc AB for $760 million in cash, with plans to utilize the net proceeds to reduce debt. Furthermore, the company has divested several businesses, including the Oil & Gas business, Convergent Security Solutions, and Mechanical Access Solutions, using the proceeds to repay borrowings and support its share repurchase program.

In terms of acquisitions, the company acquired the remaining 80 percent ownership stake in MTD Holdings Inc. and Excel Industries, strategically bolstering its presence in the outdoor category and enhancing its product offerings. The company has also launched a Global Cost Reduction Program, expected to generate $500 million of pre-tax run-rate cost savings from selling, general, and administrative expenses and $1.5 billion from supply chain transformation by the end of 2025, with a focus on resizing the organization and reducing inventory to drive long-term growth, improve profitability, and generate strong cash flow.

Through its core franchises, including Tools & Outdoor and Engineered Fastening, the company aims to drive further profitable growth by leveraging its iconic brands, investing in innovative product development, brand support, and accelerating the operations and supply chain transformation. The company's strong emphasis on brand building and commercial support is evident through its sponsorships and advertising initiatives, resulting in over 300 billion global brand impressions from digital and traditional advertising, and strong brand awareness.

Stanley Black & Decker's operations are classified into two reportable business segments: Tools & Outdoor and Industrial, each offering a diverse range of products and services aimed at meeting the needs of professional end-users, retail consumers, and industrial customers across various industries.

Today the company's shares have moved 1.7% to a price of $88.5. For more information, read the company's full 10-K submission here.

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