Stanley Black & Decker to Restate Previously Issued Financial Statements

Rhea-AI Summary

Stanley Black & Decker (NYSE: SWK) announced plans to restate its consolidated financial statements following SEC comments regarding its Equity Units. The correction will reduce diluted GAAP earnings per share by $0.31, $0.24, and $0.14 for the fiscal years ended January 2, 2021, December 28, 2019, and December 29, 2018, respectively. Despite these adjustments, historical net earnings remain unchanged, and debt compliance is unaffected. The changes, endorsed by the Audit Committee, will be filed with the SEC.

Positive

• The restatement does not impact historical net earnings or compliance with debt covenants.

Negative

• Restatements can lead to investor distrust and potential stock price volatility.
• Diluted earnings per share have been significantly lowered for multiple fiscal years.

NEW BRITAIN, Conn., Jan. 26, 2022 /PRNewswire/ -- Stanley Black & Decker (NYSE: SWK) (the "Company") today announced that it plans to restate its previously issued consolidated financial statements to correct its accounting with respect to its Equity Units in response to comments received from the Securities and Exchange Commission (the "SEC").

After giving effect to this change, the Company's diluted GAAP earnings per share is reduced by $0.31, $0.24, and $0.14 for the fiscal years ended January 2, 2021, December 28, 2019 and December 29, 2018, respectively.  Excluding acquisition-related and other charges, the Company's diluted earnings per share is reduced by $0.36, $0.31 and $0.27 for the fiscal years ended January 2, 2021, December 28, 2019 and December 29, 2018, respectively.  This accounting correction was reflected on a prospective basis as previously discussed on Form 8-K and Form 10-Q as filed on November 12, 2021. 

The changes will not impact the Company's historical net earnings and does not affect compliance with the financial covenants contained in the Company's outstanding debt instruments or compliance with any other agreement of the Company or its subsidiaries. The effects of these changes are detailed in a Current Report on Form 8-K that is also being filed with the SEC today.

This decision was approved by the Company's Audit Committee made in consultation with management and the Company's independent registered public accounting firm. The Company plans to restate the financial statements as of January 2, 2021 in an amendment to the 2020 Form 10-K and the unaudited interim financial statements as of April 3, 2021, July 3, 2021, and October 2, 2021 in an amendment to the Q3 2021 Form 10-Q, both to be filed with the SEC.

Investors should no longer rely upon the Company's previously released financial statements for the time periods cited above. Similarly, related press releases, earnings releases, and investor communications describing the Company's previously issued financial statements for these periods should no longer be relied upon.

About Stanley Black & Decker:

Stanley Black & Decker, an S&P 500 company, is a leading global diversified industrial with 56,000 employees in more than 60 countries who make the tools, products and solutions to deliver on its Purpose, For Those Who Make The World. The Company operates the world's largest tools and storage business; and is a global industrial leader of highly engineered solutions within its engineered fastening and infrastructure businesses. Learn more at www.stanleyblackanddecker.com.

Investor Contacts:

Dennis Lange
Vice President, Investor Relations
dennis.lange@sbdinc.com 
(860) 827-3833

Cort Kaufman
Director, Investor Relations
cort.kaufman@sbdinc.com 
(860) 515-2741

Christina Francis
Director, Investor Relations
(860) 438-3470
christina.francis@sbdinc.com

Media Contacts:

Shannon Lapierre
Chief Communications Officer
shannon.lapierre@sbdinc.com
(860) 259-7669

Debora Raymond
Vice President, Public Relations
debora.raymond@sbdinc.com
(203) 640-8054

 

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SOURCE Stanley Black & Decker

FAQ

What are the implications of Stanley Black & Decker's financial restatement?

The restatement reduces previously reported diluted earnings per share by significant margins but does not affect net earnings or debt compliance.

How much did the diluted earnings per share decrease for SWK?

Diluted GAAP earnings per share decreased by $0.31, $0.24, and $0.14 for fiscal years 2021, 2019, and 2018, respectively.

Will the financial restatement affect Stanley Black & Decker's stock performance?

Restatements can create investor uncertainty, potentially impacting stock performance.

When will the amended financial statements for SWK be filed?

The financial statements will be filed as amendments to the 2020 Form 10-K and Q3 2021 Form 10-Q.

What triggered the restatement of Stanley Black & Decker's financials?

The restatement was due to comments received from the SEC regarding the company's accounting for Equity Units.