|
Robert Bosch Tool Corporation Robert Bosch GmbH forecast a 6% increase in global group sales this year after a healthy 17% jump in first-quarter sales but warned about the impact a global shortage of chips could have on not just their business, but the businesses of all companies that depend on chips to make their smart product functions work. The current bottleneck of semiconductors is not expected to ease in the short term, but Bosch has made it a priority to resolve the current problems and find innovative ways to avoid such shortages in the future. Stanley Black & Decker Q1 revenues rose 34% to $4.2 billion and organic revenue rose a record 31%. Tools & Storage revenue rose 48% with a record 45% organic growth. Q1 Conference Call with Analysts: Net sales climbed from $3.1 billion in the opening quarter of 2020 to $4.1 billion in the first quarter of 2021. All regions and all business units contributed to growth; the bulk of the increase in organic growth came from Tools & Storage. They significantly raised their outlook for both 2021 and the momentum going into 2022 and revised their guidance accordingly. They now expect full year organic growth overall of 11% to 13%. They expect Q2 organic growth of 30% for the company, and 35% to 40% for Tools and Storage. Organic growth for Tools & Storage was revised to 14% to 16% year over year from the previous estimate of 4% to 8%. Power Tools delivered 50% organic growth for the quarter, resulting from continued momentum from positive home and construction trends, supply chain execution and new product launches. New core innovations led the way, building on Craftsman, which is growing very rapidly, and DeWalt, their largest brand by revenue. Products launched within the last five years, including FlexVolt, Atomic, Xtreme, Power Detect and FlexVolt Advantage are delivering growth well ahead of average. FlexVolt grew 80% in Q1. The US retail channel delivered 48% organic growth as underlying consumer demand remained very high with momentum from both Pros and DIY users. They believe that their gains are more slanted toward share gain than pure market growth, but will not know for sure until two to three quarters from now when they will be able to look at actual GDP performance and trends in the tool industry. Ecommerce sales were up 200% in the first quarter, and they believe strong global growth will continue this year. At the time of the Stanley Black & Decker merger ten years ago, they did no ecommerce sales. In 2020 they did almost $1.8 billion in revenue, growing from 12% to 18% of revenue. They began making significant investments in this channel beginning in the third quarter of last year and now have Very large teams working on ecommerce expansion around the globe. Assumptions for both the first half and the second half improved, although the second half growth for Tools & Storage is expected to decline between 2% and 4% due to tough comparisons. Assumptions for the second half include benefits from increasing channel inventory back to historic levels. They have recently begun production in two new factories in Mexico and an additional one in Fort Worth, Texas will be up and running in weeks. That will allow them to return to a four week channel inventory rebuild in the back half of the year. However, they will not be able to shift production from China until demand returns to more normal levels. All temporary cost reductions have been restored and they are making significant investments. They now expect inflation headwinds of $235 million, up $160 million versus their previous outlook. Currency remains at a $45 million positive offset. Drivers of incremental inflation are steel, resins, copper, aluminum and some purchased materials such as batteries and electrical components. They typically lock in supply agreements two quarters in advance, therefor, the majority of the year-over-year headwinds will be realized in the second half of the year. They are initiating additional pricing and productivity actions, which will offset about half of the 2021 impact of the headwinds and provide some carryover benefits in 2022. In addition, they have about $100 million of margin resiliency available over the balance of the year which is not included in their guidance. They’re preparing the supply chain for stronger demand scenarios and will be ready if their planning assumptions are conservative. They believe they will be managing to a very strong demand market for the remainder of this year and into next year. They are focusing on pricing actions across the two major businesses impacted, Tools & Storage and Industrial. Tools & Storage will take a very surgical approach and focus on areas where they believe pricing does not materially impact demand. They’ve already taken some pricing actions and will take more in the next 90 days. They believe several trends will support continued growth, including a very intense focus on home driven by a migration from cities and urban areas and a normalization of hybrid work schedules, with many employees continuing to work from home at least part-time. In addition global infrastructure will present a huge opportunity. They think the pandemic introduced a whole new generation to DIY and to their brands, and that once people get started, they gain the confidence to tackle more projects. TTI/Techtronic Industries Milwaukee Tool is expanding their operations in downtown Milwaukee. The proposed expansion will bring up to 2,000 more jobs to the city. Mayor Tom Barrett offered a $12.1 million grant to Milwaukee Tool for locating at least 1,200 employees in an office building downtown that is largely vacant. Additional employees would garner the company an additional grant of $7.9 million. Milwaukee said they preferred a site downtown but had no other details to share. Analysts estimate that Milwaukee would invest a minimum of $30 million in the development. Makita Makita held a ceremonial groundbreaking to launch construction of their new 600,000 sq. ft. facility that will be built on 80 acres of land in Hall County, northeast of Home Depot headquarters in Atlanta. The new facility, which Makita described as state of the art, will serve as a distribution center and will also include a sales and training center, customer service resources and a factory service center. There will also be room for an additional 200,000 square feet of expansion. Evans General Contractors is handling the project. © Robert Bosch Tool Corporation. All rights reserved, no copying or reproducing is permitted without prior written approval.
|
|
