Q1 2024 Stanley Black & Decker Inc Earnings Call Transcript
Key Points
- Stanley Black & Decker Inc (SWK) achieved $1.2 billion in run rate savings from their global cost reduction program, progressing towards their $1.5 billion target by end of 2024.
- Adjusted gross margin improved significantly to 29%, up 590 basis points compared to the first quarter of last year.
- The company successfully completed the sale of Stanley Infrastructure to Epiroc, using the proceeds to reduce short-term debt and strengthen the balance sheet.
- Stanley Black & Decker Inc (SWK) saw a stable to increasing market share in tools, with significant recognition from retailers, including awards from Ace Hardware and Grainger.
- Despite a challenging macro environment, the company managed to maintain flat organic revenue when excluding the now divested infrastructure business.
- Organic revenue for the first quarter was down by 1%, indicating muted consumer and DIY demand which impacted overall performance.
- The outdoor business segment remains cyclically depressed, contributing to lower than average gross margins for that part of the portfolio.
- Hand tools segment experienced a 7% decline in organic revenue, pressured by lower DIY demand.
- The company anticipates mixed demand trends to persist throughout 2024, which could impact growth and profitability.
- Despite improvements, the adjusted gross margin of 29% still falls short of the company's target of 35% or greater, indicating ongoing challenges in achieving optimal profitability.
Welcome to the First Quarter 2024 Stanley Black & Decker Earnings Conference Call. My name is Shannon, and I will be your operator for today's call.
(Operator Instructions)
Please note that this conference is being recorded. I will now turn the call over to the Vice President of Investor Relations, Dennis Lange. Mr. Lange, you may begin.
Thank you, Shannon. Good morning, everyone, and thanks for joining us for Stanley Black & Decker's 2024 First Quarter Webcast. Here today, in addition to myself is Don Allan, President and CEO; and Chris Nelson, COO, EVP and President of Tools & Outdoor; and Pat Hallinan, EVP and CFO.
Our earnings release, which was issued earlier this morning and a supplemental presentation, which we will refer to, are available on the IR section of our website. A replay of this morning's webcast will also be available beginning at 11 a.m. today.
This morning, Don, Chris and Pat will review our 2024 first quarter results and various
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