As part of a plan to save $100 million dollars in 2012, tool manufacturer Stanley Black & Decker is planning to cut employees and said it will postpone new acquisitions for up to 18 months, according to a report from the Hartford Courant.
The company, which is in the process of completing its merger of The Stanley Works with Black & Decker, said it would reduce the number it employees, primarily cutting salaried employees, to offset lower profitability compared to the previous year in its industrial and security business segments. Spokesman for the company, Tim Perra, said no estimates have been given on the number of employees that will lose their jobs or what proportion will be in the U.S.
"I will very clearly say this is not a strategic shift, it is merely a tactical move to digest what we've acquired over the last few years and rev up the organic growth. Sometimes it takes a little time and focus to make sure we get that right," said Jim Loree, executive vice president and chief operating officer.
Loree said the company also plans to increase growth in its existing businesses by hiring employees, including local marketing and sales teams, in Asia to sell mid-priced hand and power tools in emerging markets. "Obviously there will be plants and production that follows," he said.
The company also said it aims to sell its hardware and home improvement business, which accounts for about $940 million in revenues, because it is not consistent with the strategy to diversify out of residential construction-dependent product lines.
However, the company reported that its second-quarter sales growth and profitability was stronger in the largest segments of construction and do-it-yourself. Thanks to acquisitions, second-quarter net sales were $2.8 billion, up 8 percent from $2.6 billion the previous year.
Despite second-quarter sales growth and planned job cuts, Stanley Black & Decker reduced its profit projections for 2012, now expecting earnings per share of $5.40 to $5.65, down from previous estimates of $5.75 to $6. But, the company did increase its quarterly dividend from 45 cents to 49 cents per share.
To read more, please go to http://www.courant.com/business/hc-stanley-black-and-decker-layoffs-20120718,0,4927951.story.
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