Strong performance in its power tools and accessories business drove Black & Decker Corp.'s net earnings up 13 percent in the third quarter, the Towson-based company said yesterday.
Profit for the three months that ended Oct. 3 was $75.3 million, up from $66.6 million a year ago. Helped in part by a stock buyback that reduced the number of outstanding shares, earnings per share reached a record 85 cents, beating nine analysts' average estimate of 83 cents, according to Zacks Investment Research.
Overall sales rose 2.6 percent to $1.1 billion, while the power tools and accessories segment had sales growth of 8 percent and profit growth of 32 percent.
"This was Black & Decker's strongest third quarter ever, as evidenced by record levels of sales and earnings per share," said Chairman and Chief Executive Officer Nolan D. Archibald. "These results were driven by our North American business, where sales of both DeWalt professional tools and Black & Decker consumer tools continued to grow at double-digit rates."
The strong earnings report did little to boost the company's shares, which have been in a downward spiral since July 1 when the stock hit a 52-week high of $63.3125. Analysts say the company could be suffering from investors' fears that rising interest rates will slow home sales, and, in turn, sales of power tools.
Shares fell 6.25 cents yesterday to close at $43.50.
For the nine-month period, sales fell 3.4 percent to $3.2 billion. Net earnings were $185 million, compared with a loss of $846 million for the nine months that ended Sept. 27, 1998. Excluding a $900 million write-off of good will connected to sale of businesses and other nonrecurring items, net income for last year's first nine months would have been $148 million.