New Britain tool maker Stanley Works Co. said today that its fourth-quarter profit plunged 94 percent, hurt by a large restructuring charge after it said last month that it would eliminate 10 percent of its work force and close some plants.
Yet Stanley’s shares ralled after it posted earnings before items that handily beat Wall Street’s estimates. At 11 .am., Stanley shares traded at $34.45, up $3.49, or 11.3 percent.
Net income tumbled to $1.1 million, or a penny per share, compared with $92.3 million, or $1.11 per share, a year earlier.
Earnings from continuing operations fell to $5.4 million, or 7 cents per share, from $88.9 million, or $1.07 per share.
Excluding restructuring charges and other items totaling 59 cents per share, adjusted earnings from continuing operations were 66 cents per share.
Analysts polled by Thomson Reuters had expected a profit of 34 cents per share. Analysts’ estimates typically exclude one-time items.
Quarterly revenue declined 4 percent to $1.09 billion from $1.14 billion a year earlier. The results still managed to beat Wall Street’s estimate of $1.05 billion.
Security segment sales grew to $410.2 million from $360 million, while revenue for the industrial division slipped to $304.5 million from $337.4 million. The construction and do-it-yourself unit said sales declined to $371.2 million from $440.8 million.
Full-year profit dropped 7 percent to $313.3 million, or $3.92 per share, from $336.6 million, or $4 per share, a year ago.
Earnings from continuing operations sagged to $225.4 million, or $2.82 per share, compared with $325.3 million, or $3.87 per share, in the prior year.
Adjusted earnings from continuing operations were $3.41 per share.
Annual sales increased 2 percent to $4.43 billion from $4.36 billion.
The company said it was not going to provide a 2009 forecast at this time due to current economic conditions.
In December, Stanley Works said it would cut 2,000 jobs and close three manufacturing facilities. The blamed the actions on weakness in its construction and industrial segments and the effect of a stronger U.S. dollar. (AP)
