DOW JONES NEWSWIRES
Black & Decker Corp.'s (BDK) third-quarter profit fell 35%
as the weak housing industry continued to hurt sales. But the tool
and building supplies maker raised its full-year guidance, saying
cost-cutting efforts are helping the bottom line, even though
near-term demand probably won't rebound.
Black & Decker, which preannounced quarterly results on Oct.
12, reported third-quarter earnings of $55.4 million, or 91 cents a
share, down from $85.8 million, or $1.41 a share a year earlier.
Sales dropped 23% to $1.2 billion.
Analysts surveyed by Thomson Reuters, on average, expected
earnings of 82 cents on $1.2 billion in revenue. It was unclear how
many had updated their forecasts after Black & Decker last week
raised its quarterly profit outlook to 91 cents from a July view of
35 to 45 cents a share.
Shares, which have gained 17% year to date, rose 2.23% to $50 in
premarket trading as the new full-year outlook topped forecasts by
more than the latest quarter's outperformance.
Favorable trends in foreign currency translation and
earlier-than-expected shipments of industrial power tools to
retailers boosted the Towson, Md., company's latest results. A
lower-than-expected tax rate also added 14 cents a share to
earnings.
"Looking ahead, we are anticipating continued stabilization of
demand, but not a near-term rebound," said Chairman and Chief
Executive Nolan D. Archibald. " We expect fourth-quarter sales
similar to the third-quarter level, which would represent a
double-digit rate of year-on-year decline."
With operating margin expected to remain at about 7.5%, Black
& Decker said earnings should range from 68 to 78 cents a share
in the fourth quarter and from $2.45 to $2.55 for the year,
excluding a first-quarter restructuring charge.
Analysts had expected earnings of 50 cents for the fourth
quarter and $2.27 for the year. Fourth-quarter sales had expected
to be $1.2 billion.
-By Mary Ellen Lloyd, Dow Jones Newswires, 704-948-9145;
maryellen.lloyd@dowjones.com