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Stanley Black & Decker Q4 Profit Matches View; To Buy CAM For Up To $1.5 Bln

Stanley Black & Decker (SWK) reported that its net earnings attributable to common shareowners for the fourth-quarter were $199.1 million or $1.32 per share, compared to a net loss of $106.8 million or $0.72 per share in the previous year.

The company also said that it agreed to acquire Consolidated Aerospace Manufacturing, LLC or CAM for up to $1.5 billion in cash.

The company noted that the $200 million of the purchase price will be held back and contingent on the Boeing 737 MAX receiving FAA authorization to return to service and Boeing achieving certain production levels. When adjusted for cash tax benefits, the net transaction value is about $1.1 billion - $1.3 billion. CAM is a manufacturer of specialty fasteners & components for the aerospace & defense markets.

The acquisition is expected to be accretive to EPS by approximately $0.30 - $0.40 by year three.

Stanley Black & Decker's fourth-quarter normalized earnings per share was $2.18 compared to $2.11 in the prior year. Analysts polled by Thomson Reuters expected the company to report earnings of $2.18 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew to $3.71 billion from $3.63 billion in the prior year. Analysts expected revenues of $3.78 billion for the quarter.

In 2020, the company expects to generate above-market organic growth of approximately 3%, adjusted earnings per share expansion of 5% - 7% versus prior year, and continued strong free cash flow.

The company expects 2020 earnings per share to be $8.05 To $8.35 on a GAAP basis and $8.80 - $9.00 on an adjusted basis. Analysts expect annual earnings of $9.00 per share.

Stanley Black & Decker also announced that EVP & President of the Tools & Storage business, Jeffery Ansell, has elected to transition his responsibilities during the first half of 2020.

Jaime Ramirez, currently Senior Vice President & Chief Operating Officer of Tools & Storage, will succeed Ansell effective July 1.

Ansell will work closely with Ramirez through the transition period. He will then assume responsibility for a strategic initiative to revitalize and accelerate growth of the iconic BLACK+DECKER brand through year-end 2021, reporting directly to the CEO. He will then become a Strategic Advisor to the Company through year-end 2023.

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