January 28, 2009 / 5:07 PM / 10 years ago

UPDATE 2-Stanley Works Q4 results beat Street, shares up

* Q4 EPS cont ops $0.66, before items, tops Street by $0.07

* Q4 sales down 5 pct to $1.09 bln vs estimate of $1.05 bln * Shares up as much as 12 percent (Recasts throughout; adds details from conference call, share movement)

Jan 28 (Reuters) - Tool maker Stanley Works (SWK.N) posted better-than-expected quarterly results, helped by strong growth at its security segment, but held back from providing 2009 outlook citing economic uncertainty.

The supplier of tools, hardware and security systems also warned that if unit volume shipments in 2009 continued to fall by 10 percent to 12 percent, full-year earnings would be hurt by about $2 to $2.25 a share.

Unit volumes fell by 10 percent during the fourth quarter.

Stanley Works, which cut over 2,000 jobs and closed three plants in 2008, said it would incur restructuring charges of about 40 cents a share in 2009. The company also suspended certain U.S. employee benefits temporarily in 2008.

The company said it continued to experience rapidly deteriorating business conditions in its construction/do-it-yourself (CDIY) and industrial segments.

Stanley Works might take another set of restructuring actions in the second half of 2009 if the situation worsens, the company said in a conference call with analysts.


Stanley Works, which has been trying to diversify its business, saw sales growth at its security segment offset sharp declines in other key markets during the fourth quarter.

Sales at the security products segment, which serves the industrial, institutional and commercial markets, rose 14 percent to $410 million, making it the largest segment by revenue.

Sales at CDIY and industrial segments fell 16 and 10 percent, respectively, hurt by weak demand.

For the fourth quarter, income from continuing operations was down about 94 percent to $5.4 million, or 7 cents a share, from $88.9 million, or $1.07 a share, a year ago. Excluding items, it earned 66 cents a share from continuing operations.

Shares of the New Britain, Connecticut-based company were up $2.69 at $33.65 in midday trade on the New York Stock Exchange. They touched a high of $34.74 earlier in the session. (Reporting by A.Ananthalakshmi in Bangalore; Editing by Saumyadeb Chakrabarty, Himani Sarkar)

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