SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 3, 2002
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The Stanley Works
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(Exact name of registrant as specified in charter)
Connecticut 1-5224 06-0548860
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1000 Stanley Drive, New Britain, Connecticut 06053
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (860) 225-5111
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Not Applicable
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(Former name or former address, if changed since last report)
Exhibit Index is located on Page 4
Page 1 of 8 Pages
Item 7. Financial Statements and Exhibits.
(c) 20(i) Press Release dated April 3, 2002.
20(ii) Cautionary Statements relating to forward
looking statements included in Exhibit 20(i).
Item 9. Regulation FD Disclosure.
In a press release attached to this 8-K, the
company provided earnings guidance for the
first quarter, second quarter and full year
2002 and commentary regarding cash generation.
Page 2 of 8 Pages
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
THE STANLEY WORKS
Date: April 3, 2002 By: /s/ Bruce H. Beatt
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Name: Bruce H. Beatt
Title: Vice President, General
Counsel and Secretary
Page 3 of 8 Pages
EXHIBIT INDEX
Current Report on Form 8-K
Dated April 3, 2002
Exhibit No. Page
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20(i) 5
20(ii) 7
Page 4 of 8 Pages
Exhibit 20(i)
FOR IMMEDIATE RELEASE
STANLEY WORKS INCREASES 2ND QUARTER E.P.S. GUIDANCE AND CONFIRMS
FULL YEAR 2002 OUTLOOK
COMPANY ALSO SETS MAY 9 DATE FOR ANNUAL MEETING
New Britain, Connecticut, April 3, 2002 ... The Stanley Works (NYSE: SWK)
today indicated its comfort with the current First Call consensus estimate of
$.56 per fully-diluted share for its first quarter ended March 30, up 4% over
last year and above previous guidance of $.55 per fully-diluted share. As
expected, revenues were approximately flat with the prior year. The company also
indicated that, aided by significant inventory reductions, cash generated by
operations would be among the best first quarter performances since 1996. The
company will report results on April 24, as scheduled, and will conduct a
conference call for analysts at that time.
John Trani, Chairman and Chief Executive Officer, stated: "Revenues were on
track with our guidance. It is clear that we are benefiting from recent retail
share gains, and consumer markets are improving. The industrial markets appear
to have bottomed; and some recovery is apparent, for example in our Hydraulics
Tools and Access Technologies businesses.
Mr. Trani added: "Our Wal-Mart program continues to outpace customer
expectations and the results are generating promotional opportunities for the
rest of the year. Our program at Target continues to gain momentum with results
consistently exceeding the customer's expectations. In addition, we have
recently placed our new Stanley(R) Pro Series(TM) trowel trade offering at
Lowe's and initial orders are being received under our new alliance with The
Home Depot for delivery in the second quarter. Finally, our Mac Tools business
is solidly profitable for the first time since early 1998."
All of these efforts have solidified second quarter and second half sales
expectations and with that confidence in our E.P.S. guidance has grown.
As a result, management expressed confidence that second quarter earnings per
fully-diluted share will be $.71-$.73, exceeding the current First Call estimate
Page 5 of 8 Pages
of $.68. This represents an improvement of 22%-26% over the $.58 earned in the
second quarter of 2001. For the full year 2002, earnings per fully diluted share
are expected to be on the high end of the range of previous guidance (up
18%-22%).
The company also noted that this and all previous earnings guidance excludes any
possible benefit from its proposed re-incorporation in Bermuda.
Finally, the company announced that, after completing its review, the Securities
and Exchange Commission declared effective the S-4 Registration Statement filed
by The Stanley Works, Ltd. Proxies and annual reports will be mailed this week,
and the company's annual meeting of shareowners has been scheduled for Thursday,
May 9 in New Britain, Connecticut. At that time the company's previously
announced proposal to re-incorporate in Bermuda will be voted upon by its
shareowners.
The Stanley Works, an S&P 500 company, is a worldwide supplier of tools, door
systems and related hardware for professional, industrial and consumer use.
Contact: Gerard J. Gould
Vice President, Investor Relations
(860) 827-3833
ggould@stanleyworks.com
This press release contains forward-looking statements. Cautionary statements
accompanying these forward-looking statements are set forth, along with this
news release, in a Form 8-K filed with the Securities and Exchange Commission
today. The Stanley Works corporate press releases are available on the company's
Internet web site at www.stanleyworks.com.
Page 6 of 8 Pages
Exhibit 20(ii)
CAUTIONARY STATEMENTS
Under the Private Securities Litigation Reform Act of 1995
Statements in the company's press release attached to this Current Report on
Form 8-K regarding the company's ability to (i) deliver earnings of $.56 per
fully-diluted share for the first quarter 2002, up 4% over the first quarter
2001; (ii) deliver cash generated by operations for the first quarter among the
best first quarter performances since 1996; (iii) achieve second quarter
earnings per fully-diluted share of $.71 - $.73, an improvement of 22-26% over
the second quarter of 2001; and (iv) for the full year 2002, achieve earnings
per fully-diluted share on the high end of the range of previous guidance of up
18-22% from the full year 2001, are forward looking and inherently subject to
risk and uncertainty.
The company's ability to achieve the earnings objectives identified in the
preceding paragraph is dependent on both internal and external factors,
including the success of the company's marketing and sales efforts, continuing
improvements in productivity and cost reductions and continued reduction of
selling, general and administrative expenses as a percentage of sales, the
strength of the United States economy and the strength of foreign currencies,
including, without limitation, the Euro.
The company's ability to achieve the expected level of revenues is dependent
upon a number of factors, including (i) the ability to recruit and retain a
sales force comprised of employees and manufacturers representatives, (ii) the
success of The Home Depot and Wal-Mart programs, and of other initiatives to
increase retail sell through and stimulate demand for the company's products,
(iii) the ability of the sales force to adapt to changes made in the sales
organization and achieve adequate customer coverage, (iv) the ability of the
company to fulfill demand for its products, (v) the absence of increased pricing
pressures from customers and competitors and the ability to defend market share
in the face of price competition, and (vi) the acceptance of the company's new
products in the marketplace as well as the ability to satisfy demand for these
products.
The company's ability to improve its productivity and to lower the cost
structure is dependent on the success of various initiatives that are underway
or are being developed to improve manufacturing and sales operations and to
Page 7 of 8 Pages
implement related control systems, which initiatives include certain facility
closures and related workforce reductions expected to be completed in 2002. The
success of these initiatives is dependent on the company's ability to increase
the efficiency of its routine business processes, to develop and implement
process control systems, to mitigate the effects of any material cost inflation,
to develop and execute comprehensive plans for facility consolidations, the
availability of vendors to perform outsourced functions, the successful
recruitment and training of new employees, the resolution of any labor issues
related to closing facilities, the need to respond to significant changes in
product demand while any facility consolidation is in process and other
unforeseen events.
The company's ability to continue to reduce selling, general and administrative
expenses as a percentage of sales is dependent on various process improvement
activities, the continued success of changes to the sales organization and the
reduction of transaction costs.
The company's ability to show cash generation for the first quarter among the
best first quarter performances since 1996 is dependent on achieving the first
quarter earnings growth and the continued success of improvements in processes
to manage inventory and receivables levels.
The company's ability to achieve the objectives discussed above will also be
affected by external factors. These external factors include pricing pressure
and other changes within competitive markets, the continued consolidation of
customers in consumer channels, increasing competition, changes in trade,
monetary and fiscal policies and laws, inflation, currency exchange
fluctuations, the impact of dollar/foreign currency exchange rates on the
competitiveness of products, the impact of the events of September 11, 2001 and
recessionary or expansive trends in the economies of the world in which the
company operates.
Page 8 of 8 Pages