Black & Decker Corp.'s (BDK) fourth-quarter profit fell 22%
amid declining sales and merger-related costs, but the toolmaker's
adjusted earnings rose and handily topped analysts'
expectations.
"Sales in the quarter exceeded our expectations in all three of
our business segments," said Chairman and Chief Executive Nolan
Archibald. "While our end markets generally remain difficult, we
benefited from improved economic activity in selected regions and
businesses, as well as inventory restocking in some channels."
Black & Decker has seen demand fall as the weak housing
industry has cut into sales. In October, the tool and
building-supplies maker said its cost-cutting efforts were helping
the bottom line even though the prognosis for near-term demand
still was bleak.
Black & Decker is in the process of being bought by Stanley
Works (SWK) for about $4.12 billion, according to Tuesday's closing
prices, combining two household names in the market for tools.
Black & Decker reported a profit of $33.9 million, or 55
cents a share, down from $43.7 million, or 72 cents, a year
earlier. Excluding items related to the merger and year-earlier
restructuring costs, earnings rose to $1.24 from 96 cents. The
company had forecast 68 cents to 78 cents.
Revenue dropped 5.6% to $1.3 billion.
Analysts polled by Thomson Reuters had most recently forecast
$1.2 billion in revenue.
Gross margin rose to 36.4% from 31.6%.
Sales in the company's power tools and accessories business--by
far its largest by revenue--dropped 11%, but profit jumped 75%.
Shares closed at $68.75 Tuesday and were inactive premarket. The
stock's value has more than doubled in the past year. As of
Tuesday's close, the buyout values Black & Decker at
$69.17.
-By Nathan Becker, Dow Jones Newswires; 212-416-2855;
nathan.becker@dowjones.com