Stanley Black & Decker, Inc. · NYSE:SWK
Stanley Black & Decker — Q1 2023 Earnings Presentation
19 slides from Stanley Black & Decker's earnings presentation, May 4, 2023
Slide 1: First Quarter 2023 Overview
First Quarter 2023 Overview May 4, 2023
Slide 2: Participants
Participants Don Allan President & CEO Pat Hallinan Executive Vice President, CFO Dennis Lange Vice President, Investor Relations 1Q’23 Earnings Call | 2
Slide 3: Cautionary Statement
Cautionary Statement Certain Statements Contained In This Presentation Are Forward Looking. These Are Based On Assumptions Of Future Events Which May Not Prove To Be Accurate. They Involve Risk And Uncertainty. Actual Results May Differ Materially From Those Expected Or Implied. We Direct You To The
Slide 4: 1Q 2023 Key Messages
1Q 2023 Key Messages Continued Momentum As We Make Progress Towards Streamlining And Optimizing Stanley Black & Decker • Global Cost Reduction Program Delivered $230 Million Of Pre-Tax Run-Rate Savings In The 1Q’23 Key Financials First Quarter 2023; On-Track For Expected $1 Billion Annualized Saving
Slide 5: 1Q 2023 Segment Overview
1Q 2023 Segment Overview Stable Demand Trends Led By Strength In Pro And Industrial | Transformation On-Track Revenue Adjusted Operating Margin* • 1Q Organic Growth* (11%) $M • (12%) N.A., (12%) Europe, (2%) EM (+6% Excluding Russia) Tools & Outdoor • (12%) PT, (6%) HTAS, (16%) OPG $3,801 14.0% • Pr
Slide 6: Transforming To Accelerate Organic Growth
Transforming To Accelerate Organic Growth Executing On Our Clear Vision And Strategy For Long-Term Success… Reduce Complexity – Invest In Core Growth Enhance ~$2B 3-Year Cost Savings $300M - $500M Shareholder Return Organic Revenue OPTIMIZE I N N O VAT I O N Growth* 2-3X Market C O R P O R AT E S T
Slide 7: Business Streamlining & Transformation On-Track
Business Streamlining & Transformation On-Track Supply Chain Transformation Expected To Deliver ~$1.5B Annualized Savings By 2025 Enabling 35% Adj. Gross Margins*… Supply Chain Transformation Progress Benefits From SG&A Actions SKU Reduction & Product Platforming ~$120M 1Q’23 Program Savings • Appro
Slide 8: Advancing Innovation & Electrification
Advancing Innovation & Electrification Spring 2023 Outdoor Products Designed To Deliver The Runtime And Performance Users Demand... DEWALT, CRAFTSMAN And BLACK+DECKER Products Recognized Winners For Eight 2023 Popular Mechanics Yard & Garden Awards Select 2023 Popular Mechanics Yard & Garden Award W
Slide 9: Inventory & Gross Margin Update
Inventory & Gross Margin Update Prioritizing Inventory Optimization And Free Cash Flow** Generation Throughout 2023… On-Track To Deliver Adjusted Gross Margin* Improvement Trajectory $750 Million To $1 Billion Inventory Reduction In 2023 ~$300M 2H Acceleration: Decrease ~$500M FY’23 Target High-20s
Slide 10: 2023 Guidance Scenario Planning
2023 Guidance Scenario Planning 2023 EPS Guidance Range To Be GAAP ($1.65)-$0.60 And Adjusted* $0.00-$2.00 | Free Cash Flow* $0.5B-$1.0B 2023 Guidance Deeper Slowdown Base Case 2H Acceleration Scenarios Organic Growth* Down Mid-Single Digits Down Low-To-Mid Single Digits Relatively Flat Tools & Outd
Slide 11: Focused Company With Great Franchises
Focused Company With Great Franchises Centered Around Our Core Market Leadership Positions And Built Upon The Strength Of Our People And Culture Talented People Iconic Brands Powerful Innovation 1Q’23 Earnings Call | 11
Slide 12: Q&A
Q&A StanleyBlack&Decker
Slide 13: Free Cash Flow & Liquidity
Free Cash Flow* & Liquidity 1Q’23 Free Cash Flow Liquidity Key Points QTD • Maintain Strong, Investment Grade Credit Ratings $M 1Q'22 1Q'23 V$ • $4.5B In Credit Facilities Backed By A Well Capitalized, Diversified Bank Group Net Earnings (Loss) from Continuing Operations $ 155 $ (188) $ (343) • No T
Slide 14: Global Presence
Global Presence Canada 1Q’23 Organic +1% % SWK 5% Europe 1Q’23 Organic (5%) Japan 1Q’23 U.S. 1Q’23 % SWK 17% Organic +1% Organic (11%) % SWK 2% % SWK 62% EMG. MKT 1Q’23 Australia 1Q’23 Organic (9%) Organic (18%) % SWK 12% % SWK 2% 1Q’23 Earnings Call | 14
Slide 15: 1Q 2023 Regional Revenue Breakout
1Q 2023 Regional Revenue Breakout Tools & Outdoor Industrial $3,315M $616M Emerging Other Markets Other 4% 14% 9% Emerging Markets Europe 11% 18% Europe N.America 16% 69% N.America 59% 1Q’23 Earnings Call | 15
Slide 16: Reconciliation Of GAAP To Non-GAAP Measures
Reconciliation Of GAAP To Non-GAAP Measures Q4 2022 Q1 2023 GAAP Acquisition-Related Non-GAAP Gross GAAP Acquisition-Related Non-GAAP Gross Gross Profit Charges & Other Profit Gross Profit Charges & Other Profit Stanley Black & $753.5 $835.5 $908.9 In Millions, Except EPS $24.5 $778.0 $73.4 18.9% 19
Slide 17: Reconciliation Of GAAP To Non-GAAP Segment Profit
Reconciliation Of GAAP To Non-GAAP Segment Profit Q1 2022 Q1 2023 In Millions Tools & Outdoor GAAP Acquisition-Related Non-GAAP Segment GAAP Acquisition-Related Non-GAAP Segment Segment Profit Charges & Other Profit Segment Profit Charges & Other Profit $378.5 $153.7 $532.2 $18.7 $79.2 $97.9 10.0% 1
Slide 18: Reconciliation Of GAAP To Non-GAAP Sales Growth
Reconciliation Of GAAP To Non-GAAP Sales Growth Stanley Black & Non-GAAP Organic Decker – GAAP Sales Growth Acquisitions Divestitures Currency Q1 2023 Sales Growth -12% 0% 1% -2% -9% GAAP Non-GAAP Organic Acquisitions Divestitures Currency Outdoor Q1 2023 Tools & Sales Growth Sales Growth -13% 0% 0%
Slide 19: Non-GAAP Financial Measures
Non-GAAP Financial Measures Organic sales growth, or organic growth, is defined as the difference between total current and prior year sales less the impact of companies acquired and divested in the past twelve months and any foreign currency impacts divided by prior year sales. Operating profit is
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