Black & Decker Corp. expects its consumer and professional power-tool brands to maintain their strong market share this year despite stepped-up competition and plans to introduce several new products in those lines, stated Nolan Archibald, chairman and CEO.
The DeWalt professional power-tool line posted better-than-expected, double-digit percentage sales gains in the fourth quarter, despite the October introduction of the Ridgid pro tool line at Home Depot, Mr. Archibald told analysts on a conference call.
The Ridgid line, an Emerson Electric Co. brand manufactured by Techtronic Industries Co., may have drawn some business from the do-it-yourself-oriented Black & Decker line at Home Depot in the fourth quarter, but "we think we held share overall in our consumer power-tool business if you look at it on a 12-month basis," Mr. Archibald said.
With its existing products, the DeWalt line should be able to grow by a low single-digit percentage rate in the U.S. each year, and by more as the company introduces new products, Mr. Archibald said. The brand can grow faster than that outside the U.S., he continued.
"DeWalt and Black & Decker will maintain their strong market share in 2004," Mr. Archibald said, adding that DeWalt should increase its market share in the industrial-construction channel.
For the fourth quarter, Black & Decker reported earnings of $1.35 a share, up 29 percent from $1.05 a share a year earlier, excluding restructuring charges. Including those charges, earnings were $99.5 million, or $1.27 a share, compared with $75.7 million, or $0.94 a share, a year earlier.
Analysts surveyed by Thomson First Call had expected the company to earn $1.27 a share, excluding charges.
Black & Decker cited stronger-than-expected sales of DeWalt tools and hardware and home-improvement products as the economy improved. Shelf-space gains for Price Pfister faucets at a retailer, favorable foreign-currency exchange rates, and the acquisition of Baldwin Hardware and Weiser Lock helped sales, Mr. Archibald said.
Sales from continuing operations grew 11 percent to $1.34 billion in the quarter, or grew 2 percent excluding the effects of foreign currency exchange and the acquisition.
The company expects earnings of $4.35 a share to $4.50 a share in 2004 and $0.65 a share to $0.70 a share in the first quarter. Assuming a modestly recovering U.S. economy, Black & Decker forecasts low single-digit sales growth for 2004, excluding currency translation and the acquisition, or mid-to-high single-digit growth including those elements. (Dow Jones)
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