Stanley Black & Decker, New Britain, CT, (NYSE: SWK) reported sales for the first quarter 2013 were $2.5 billion, up 3 percent from the prior year. Acquisitions added 4 percent, price was flat and volume and currency each declined about 1 percent.
The Infastech acquisition closed in the first quarter.
Stanley Black & Decker’s CEO John F. Lundgren said: “Profitability in our CDIY business continues to improve, and we expect to realize increased sales in this segment going forward as a result of new product introductions and customer listings as well as our increasing presence in emerging markets.”
In the CDIY segment, sales increased 2 percent to $1.2 billion due to a 3 percent increase from acquisitions and a 1 percent decline from currency. Both volume and price were relatively flat.
The flat organic growth can be attributed to a later start to the North America outdoor season due to a much colder-than-average March in many parts of the region, as well as softer markets in Latin America, which offset growth in many of the other emerging markets such as China, Southeast Asia, Russia and Turkey. Stanley Black & Decker reported it expects the headwinds encountered in the first quarter will lessen in the second quarter and that the segment remains solidly on track for mid-single digit organic growth for the full year.
Excluding charges, overall segment profit was 14.5 percent, up 160 basis points versus prior year due to cost synergies, product mix and the timing of certain promotions.
Sales in Security increased 1 percent to $599 million due to 1 percent from acquisitions, 1 percent from currency and 1 percent from price, which were partially offset by a 2 percent decline in volume. The CSS North America business grew modestly on an organic basis due to continued steady backlog conversion. CSS Europe declined 5 percent organically primarily due to pressure within the Nordic region.
Mechanical Access organic sales were up 5 percent with solid growth in both the commercial mechanical lock business and the automatic door business, which is reflective of improving market conditions, initial success with the distributor business model shift and increased remodeling in the retail channel, respectively.
The segment profit rate, excluding charges, was 10.3 percent, 270 basis points lower than the first quarter 2012 rate. The year-over-year decline can be attributed to larger but less profitable installations in CSS North America, pressure from volume headwinds in Europe and temporary negative rate pressure in the commercial lock business due to the business model shift.
Sales in the Industrial segment rose 5 percent to $695 million. Unit volumes fell 1 percent, currency was down 1 percent, and acquisitions added 7 percent. Organic sales for the Industrial and Automotive Repair (IAR) platform fell 4 percent as volume declines in Europe driven by industrial customer destocking more than offset strong MAC Tool performance and successes with the CribMaster smart storage products.
Engineered Fastening was relatively flat on an organic basis, outpacing global light vehicle production, which retracted 4 percent. Fastening organic revenues in Europe rose 2 percent as continued growth in automotive due to increased platform penetration more than offset weakness in automotive production rates as well as industrial fasteners.
Overall Industrial segment profit excluding charges fell versus the first quarter 2012 rate of 18.9 percent to 14.1 percent due to investments in organic growth initiatives and lower volumes in IAR Europe.