2024 Q1 Form 10-K Financial Statement

#000009355624000032 Filed on February 27, 2024

View on sec.gov

Income Statement

Concept 2024 Q1 2023 Q4 2023
Revenue $3.870B $3.737B $15.78B
YoY Change -9.3% 1.05%
Cost Of Revenue $2.761B $2.622B $11.68B
YoY Change -15.45% 12.08%
Gross Profit $1.109B $1.114B $4.100B
YoY Change 9.45% -21.08%
Gross Profit Margin 28.65% 29.82% 25.98%
Selling, General & Admin $851.8M $810.1M $3.390B
YoY Change 1.39% 4.75%
% of Gross Profit 76.84% 72.7% 82.7%
Research & Development $362.0M
YoY Change 31.02%
% of Gross Profit 8.83%
Depreciation & Amortization $140.2M $293.1M $625.1M
YoY Change 231.56% 91.57%
% of Gross Profit 12.65% 26.3% 15.25%
Operating Expenses $931.8M $903.6M $3.685B
YoY Change 13.09% 4.9%
Operating Profit $176.7M $210.7M $414.4M
YoY Change -29.01% -75.35%
Interest Expense -$87.90M -$87.60M -$372.5M
YoY Change -195.53% -300.92%
% of Operating Profit -49.75% -41.58% -89.89%
Other Income/Expense, Net
YoY Change
Pretax Income $48.30M -$78.80M -$375.7M
YoY Change 1732.56% 1092.7%
Income Tax $28.80M $197.3M -$94.00M
% Of Pretax Income 59.63%
Net Earnings $19.50M -$304.4M -$310.5M
YoY Change -136.04% -118.38%
Net Earnings / Revenue 0.5% -8.15% -1.97%
Basic Earnings Per Share $0.13 -$2.07
Diluted Earnings Per Share $0.13 -$2.03 -$2.07
COMMON SHARES
Basic Shares Outstanding 153.8M shares 153.3M shares 149.8M shares
Diluted Shares Outstanding 150.9M shares 149.8M shares

Balance Sheet

Concept 2024 Q1 2023 Q4 2023
SHORT-TERM ASSETS
Cash & Short-Term Investments $476.6M $449.4M $449.4M
YoY Change 9.96% 215.81%
Cash & Equivalents $476.6M $449.4M $449.4M
Short-Term Investments
Other Short-Term Assets $542.0M $527.3M $527.3M
YoY Change 385.1% -61.69%
Inventory $4.693B $4.739B $4.739B
Prepaid Expenses $385.2M $360.5M
Receivables $1.709B $1.302B $1.302B
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $7.421B $7.017B $7.017B
YoY Change -20.3% -17.7%
LONG-TERM ASSETS
Property, Plant & Equipment $2.116B $2.170B $2.170B
YoY Change -5.89% -21.96%
Goodwill $7.955B $7.996B
YoY Change -4.29%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $2.459B $2.531B $2.531B
YoY Change 63.0% -25.33%
Total Long-Term Assets $16.43B $16.65B $16.65B
YoY Change -0.44% -15.3%
TOTAL ASSETS
Total Short-Term Assets $7.421B $7.017B $7.017B
Total Long-Term Assets $16.43B $16.65B $16.65B
Total Assets $23.85B $23.66B $23.66B
YoY Change -7.29% -16.03%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $2.338B $2.299B $2.299B
YoY Change -7.78% -33.15%
Accrued Expenses $2.207B $2.464B $2.464B
YoY Change -3.13% 7.88%
Deferred Revenue $33.60M $31.70M
YoY Change 3.59%
Short-Term Debt $1.740B $1.075B $1.075B
YoY Change -58.17% -52.04%
Long-Term Debt Due $500.0M $1.100M $1.100M
YoY Change -8.33% -15.38%
Total Short-Term Liabilities $6.829B $5.883B $5.883B
YoY Change -22.66% -32.9%
LONG-TERM LIABILITIES
Long-Term Debt $5.602B $6.101B $6.101B
YoY Change 14.03% 40.14%
Other Long-Term Liabilities $2.253B $2.624B $2.624B
YoY Change 35.24% -4.79%
Total Long-Term Liabilities $7.855B $8.725B $8.725B
YoY Change 19.67% 22.72%
TOTAL LIABILITIES
Total Short-Term Liabilities $6.829B $5.883B $5.883B
Total Long-Term Liabilities $7.855B $8.725B $8.725B
Total Liabilities $14.98B $14.61B $14.61B
YoY Change -1.94% -11.95%
SHAREHOLDERS EQUITY
Retained Earnings $8.438B $8.540B
YoY Change -10.14%
Common Stock $5.508B $5.501B
YoY Change 0.65%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $8.876B $9.056B $9.056B
YoY Change
Total Liabilities & Shareholders Equity $23.85B $23.66B $23.66B
YoY Change -7.29% -16.03%

Cashflow Statement

Concept 2024 Q1 2023 Q4 2023
OPERATING ACTIVITIES
Net Income $19.50M -$304.4M -$310.5M
YoY Change -136.04% -118.38%
Depreciation, Depletion And Amortization $140.2M $293.1M $625.1M
YoY Change 231.56% 91.57%
Cash From Operating Activities -$71.20M $769.3M $1.191B
YoY Change -280.76% 79.66%
INVESTING ACTIVITIES
Capital Expenditures $65.70M $122.3M $338.7M
YoY Change 6.91% -34.75%
Acquisitions $0.00
YoY Change -100.0%
Other Investing Activities $2.500M $745.1M $754.7M
YoY Change 372450.0% 18307.32%
Cash From Investing Activities -$63.20M $622.8M $416.0M
YoY Change -84.49% -115.85%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $2.900M
YoY Change -102.99%
Debt Paid & Issued, Net $0.00
YoY Change -100.0%
Cash From Financing Activities 548.6M -1.320B -1.560B
YoY Change -61.22% -269.77%
NET CHANGE
Cash From Operating Activities -71.20M 769.3M 1.191B
Cash From Investing Activities -63.20M 622.8M 416.0M
Cash From Financing Activities 548.6M -1.320B -1.560B
Net Change In Cash 414.2M 71.70M 47.60M
YoY Change -32.68% -104.31%
FREE CASH FLOW
Cash From Operating Activities -$71.20M $769.3M $1.191B
Capital Expenditures $65.70M $122.3M $338.7M
Free Cash Flow -$136.9M $647.0M $852.6M
YoY Change -219.81% 492.08%

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CY2023 swk Defined Benefit Plan Target Allocation Percentage Of Assets Alternative Investments Range Maximum
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CY2022Q4 us-gaap Defined Benefit Plan Funded Percentage
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CY2022 us-gaap Other Noninterest Expense
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CY2022 us-gaap Research And Development Expense
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CY2023Q4 us-gaap Restructuring Reserve
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CY2023Q4 us-gaap Restructuring Reserve
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CY2022 us-gaap Other Noninterest Expense
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CY2022 us-gaap Other Noninterest Expense
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CY2022 us-gaap Restructuring Charges
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CY2022 us-gaap Restructuring Charges
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CY2023 swk Equity Method Investment Fair Value Adjustment
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CY2022 swk Equity Method Investment Fair Value Adjustment
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CY2022 swk Equity Method Investment Fair Value Adjustment
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CY2022 us-gaap Investment Income Interest
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CY2022 swk Disposal Group Including Discontinued Operations Payments To Acquire Productive Assets
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CY2022 swk Disposal Group Including Discontinued Operations Payments To Acquire Productive Assets
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CY2022Q4 swk Deferred Tax Asset Basis Difference In Debt Obligation
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CY2022Q4 us-gaap Deferred Tax Assets Tax Credit Carryforwards Research
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CY2023Q4 us-gaap Undistributed Earnings Of Foreign Subsidiaries
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CY2023 us-gaap Current Federal Tax Expense Benefit
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CY2022 us-gaap Current Income Tax Expense Benefit
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CY2023 swk Income Tax Refund
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CY2023 us-gaap Income Tax Reconciliation Foreign Income Tax Rate Differential
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CONTINGENCIES<div style="margin-top:7pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">The Company is involved in various legal proceedings relating to environmental issues, employment, product liability, workers’ compensation claims and other matters. The Company periodically reviews the status of these proceedings with both inside and outside counsel, as well as an actuary for risk insurance. Management believes that the ultimate disposition of these matters will not have a material adverse effect on operations or financial condition taken as a whole.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:107%">Government Investigations </span></div><div style="margin-top:7pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">On January 19, 2024, the Company was notified by the Compliance and Field Operations Division (the “Division”) of the Consumer Product Safety Commission that the Division intends to recommend the imposition of a civil penalty of approximately $32 million for alleged untimely reporting in relation to certain utility bars and miter saws that were subject to voluntary recalls in September 2019 and March 2022, respectively. The Company is currently evaluating and believes there are defenses to the Division’s claims, and the Company is cooperating with the Division. However, given the early stage of this matter, at this time, the Company is not in a position to assess the likelihood of any potential loss or adverse effect on its financial condition or to estimate the amount of potential loss, if any, from this matter.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">The Company previously disclosed that it had identified certain undisclosed perquisites in prior periods. The Company voluntarily disclosed this information to the U.S. Securities and Exchange Commission (the “SEC” or the “Commission”) and cooperated with the SEC’s investigation of this matter. On June 20, 2023, the SEC issued a Cease-and-Desist Order (the “Order”) that resolved this matter. The Order reflects that the Company neither admitted to nor denied the allegations contained in the Order, and that the SEC did not impose any monetary penalties on the Company. The Order credited the Company’s self-reporting, cooperation, and remediation efforts. In a parallel action, the SEC issued a Cease-and-Desist Order against a former executive of the Company (the “Parallel Resolution”). The SEC’s press release announcing both resolutions noted that, with respect to the Parallel Resolution, “[a]fter consideration of Stanley Black &amp; Decker’s self-reporting, cooperation, and remediation, the SEC declined to bring charges against the company related to [the former executive’s] conduct.”</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">Also, as previously disclosed, the Company has identified certain transactions relating to its international operations that may raise compliance questions under the U.S. Foreign Corrupt Practices Act (“FCPA”) and voluntarily disclosed this information to the U.S. Department of Justice (“DOJ”) and the SEC in January 2023. The Company is cooperating with both agencies in their investigations of these transactions (the “FCPA Matters”). Currently, the Company does not believe that the FCPA Matters will have a material impact on its financial condition or results of operations, although it is possible that a loss related to the FCPA Matters may be incurred.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">Given the ongoing nature of the FCPA Matters, management cannot predict the duration, scope, or outcome of the DOJ’s or SEC’s investigations or estimate the potential magnitude of any such loss or range of loss, or the cost of the ongoing investigations. Any determination that certain transactions relating to the Company’s international operations were not in compliance with the FCPA could result in the imposition of fines, civil or criminal penalties, equitable remedies, including disgorgement, injunctive relief, or other sanctions against the Company. The Company also may become a party to litigation or other legal proceedings over the FCPA Matters described above.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">The Company is committed to upholding the highest standards of corporate governance and is continuously focused on ensuring the effectiveness of its policies, procedures, and controls. The Company is in the process, with the assistance of professional advisors, of reviewing and further enhancing relevant policies, procedures, and controls. </span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:107%">Class Action Litigation </span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">As previously disclosed, on March 24, 2023, a putative class action lawsuit titled </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Naresh Vissa Rammohan v. Stanley Black &amp; Decker, Inc., et al</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">., Case No. 3:23-cv-00369-KAD (the “</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Rammohan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Class Action”), was filed in the United States District Court for the District of Connecticut against the Company and certain of the Company’s current and former officers and directors. The complaint was filed on behalf of a purported class consisting of all purchasers of Stanley Black &amp; Decker common stock between October 28, 2021 and July 28, 2022, inclusive. The complaint asserts violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 based on allegedly false and misleading statements related to consumer demand for the Company’s products amid changing COVID-19 trends and macroeconomic conditions. The complaint seeks unspecified damages and an award of costs and expenses. On October 13, 2023, Lead Plaintiff General Retirement System of the City of Detroit filed an Amended Complaint that asserts the same claims and seeks the same forms of relief as the original complaint. </span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">The Company intends to vigorously defend this action in all respects and on December 14, 2023 filed a motion to dismiss the Amended Complaint in its entirety. Briefing on that motion is expected to conclude in April 2024. Given the early stage of this litigation, at this time, the Company is not in a position to assess the likelihood of any potential loss or adverse effect on its financial condition or to estimate the amount or range of potential losses, if any, from this action.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:107%">Derivative Actions</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">As previously disclosed, on August 2, 2023 and September 20, 2023, derivative complaints were filed in the United States District Court for the District of Connecticut, titled </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Callahan v. Allan, et al</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">., Case No. 3:23-cv-01028-OAW (the “</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Callahan </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">Derivative Action”) and </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Applebaum v. Allan, et al</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">., Case No. 3:23-cv-01234-OAW (the “</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Applebaum</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Derivative Action”), respectively, by putative stockholders against certain current and former directors and officers of the Company premised on the same allegations as the </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Rammohan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Class Action. The </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Callahan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> and </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Applebaum</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Derivative Actions were consolidated by Court order on November 6, 2023 and defendants’ responses to both complaints have been stayed pending the disposition of any motions to dismiss in the</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%"> Rammohan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Class Action. The individual defendants intend to vigorously defend the </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Callahan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> and </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Applebaum</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Derivative Actions in all respects. However, given the early stage of this litigation, at this time, the Company is not in a position to assess the likelihood of any potential loss or adverse effect on its financial condition or to estimate the amount or range of potential losses, if any, from these actions.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">On October 19, 2023, a derivative complaint was filed in Connecticut Superior Court, titled </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Vladimir Gusinsky Revocable Trust v. Allan, et al</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%">., Docket Number HHBCV236082260S, by a putative stockholder against certain current and former directors and officers of the Company. Plaintiff seeks to recover for alleged breach of fiduciary duties and unjust enrichment under Connecticut state law premised on the same allegations as the </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%">Rammohan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Class Action. By Court order on November 11, 2023, the Connecticut Superior Court granted the parties’ motion to stay defendants’ response to the complaint pending the disposition of any motions to dismiss in the</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:107%"> Rammohan</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:107%"> Class Action. The individual defendants intend to vigorously defend this action in all respects. However, given the early stage of this litigation, at this time, the Company is not in a position to assess the likelihood of any potential loss or adverse effect on its financial condition or to estimate the amount or range of potential losses, if any, from this action.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:107%">Environmental</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In the normal course of business, the Company is a party to administrative proceedings and litigation, before federal and state regulatory agencies, relating to environmental remediation with respect to claims involving the discharge of hazardous substances into the environment, generally at current and former manufacturing facilities. In addition, some of these claims assert that the Company is responsible for damages and liability, for remedial investigation and clean-up costs, with respect to sites that have never been owned or operated by the Company, but the Company has been identified as a potentially responsible party ("PRP"). </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In connection with the 2010 merger with Black &amp; Decker, the Company assumed certain commitments and contingent liabilities. Black &amp; Decker is a party to litigation and administrative proceedings with respect to claims involving the discharge of hazardous substances into the environment at current and former manufacturing facilities and has also been named as a PRP in certain administrative proceedings.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The Company, along with many other companies, has been named as a PRP in numerous administrative proceedings for the remediation of various waste sites, including 23 active Superfund sites. Current laws potentially impose joint and several liabilities upon each PRP. In assessing its potential liability at these sites, the Company has considered the following: whether responsibility is being disputed, the terms of existing agreements, experience at similar sites, and the Company’s volumetric contribution at these sites.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The Company’s policy is to accrue environmental investigatory and remediation costs for identified sites when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. If no amount in the range of probable loss is considered most likely, the minimum loss in the range is accrued. The amount of liability recorded is based on an evaluation of currently available facts with respect to each individual site and includes such factors as existing technology, presently enacted laws and regulations, and prior experience in remediation of contaminated sites. The liabilities recorded do not take into account any claims for recoveries from insurance or third parties. As assessments and remediation progress at individual sites, the amounts recorded are reviewed periodically and adjusted to reflect additional technical and legal information that becomes available. As of December 30, 2023 and December 31, 2022, the Company had reserves of $124.5 million and $129.3 million, respectively, for remediation activities associated with Company-owned properties, as well as for Superfund sites, for losses that are probable and estimable. Of the December 30,</span><span style="color:#3051f2;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">2023 amount, $46.0 million is classified as current and $78.5 million as long-term which is expected to be paid over the estimated remediation period. As of December 30, 2023, the range of environmental remediation costs that is reasonably possible is $79.9 million to $226.8 million which is subject to change in the near term. The Company may be liable for environmental remediation of sites it no longer owns. Liabilities have been recorded on those sites in accordance with the Company's policy.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">As of December 30, 2023, the Company has recorded $17.0 million in other assets related to funding received by the Environmental Protection Agency (“EPA”) and placed in a trust in accordance with the final settlement with the EPA, embodied in a Consent Decree approved by the United States District Court for the Central District of California on July 3, 2013. Per the Consent Decree, Emhart Industries, Inc. (a dissolved and liquidated former indirectly wholly-owned subsidiary of The Black &amp; Decker Corporation) (“Emhart”) has agreed to be responsible for an interim remedy at a site located in Rialto, California and formerly operated by West Coast Loading Corporation (“WCLC”), a defunct company for which Emhart was alleged to be liable as a successor. The remedy will be funded by (i) the amounts received from the EPA as gathered from multiple parties, and, to the extent necessary, (ii) Emhart's affiliate. The interim remedy requires the construction of a water treatment facility and the filtering of ground water at or around the site for a period of approximately 30 years or more. As of December 30, 2023, the Company's net cash obligation associated with remediation activities, including WCLC assets, is $107.5 million. </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The EPA also asserted claims in federal court in Rhode Island against Black &amp; Decker and Emhart related to environmental contamination found at the Centredale Manor Restoration Project Superfund Site ("Centredale"), located in North Providence, Rhode Island. The EPA discovered a variety of contaminants at the site, including but not limited to, dioxins, polychlorinated biphenyls, and pesticides. The EPA alleged that Black &amp; Decker and Emhart are liable for site clean-up costs under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") as successors to the liability of Metro-Atlantic, Inc., a former operator at the site, and demanded reimbursement of the EPA’s costs related to this site. Black &amp; Decker and Emhart then vigorously litigated the issue of their liability for environmental conditions at the Centredale site, including completing trial on Phase 1 of the proceedings in late July 2015 and completing trial on Phase 2 of the proceedings in April 2017. On July 9, 2018, a Consent Decree was lodged with the United States District Court documenting the terms of a settlement between the Company and the United States for reimbursement of EPA's past costs and remediation of environmental contamination found at the Centredale site. The terms of the Consent Decree were subject to public comment and Court approval. After a full hearing on March 19, 2019, the Court approved and entered the Consent Decree on April 8, 2019. The settlement resolves outstanding issues relating to Phase 1 and 2 of the litigation with the United States. The Company is complying with the terms of the settlement. The District Court's entry of the Consent Decree was appealed by several PRPs at the site to the United States Court of Appeals for the First Circuit. The District Court's actions were affirmed by the First Circuit on February 17, 2021. Phase 3 of the litigation, is addressing the potential allocation of liability to other PRPs who may have contributed to contamination of the Centredale site with dioxins, polychlorinated biphenyls and other contaminants of concern. As of December 30, 2023, the Company has a remaining reserve of $24.9 million for this site.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">The Company and approximately </span><span style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">47 </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">other companies comprise the Lower Passaic Cooperating Parties Group (the “CPG”). The CPG members and other companies are parties to a May 2007 Administrative Settlement Agreement and Order on Consent (“AOC”) with the EPA to perform a remedial investigation/feasibility study (“RI/FS”) of the lower seventeen miles of the Lower Passaic River in New Jersey (the “River”). The Company’s potential liability stems from former operations in Newark, New Jersey. As an interim step related to the 2007 AOC, on June 18, 2012,</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:112%"> </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">the CPG members voluntarily entered into an AOC with the EPA for remediation actions focused solely at mile 10.9 of the River. The Company’s estimated costs related to the RI/FS and focused remediation action at mile 10.9, based on an interim allocation, are included in its environmental reserves. On April 11, 2014, the EPA issued a Focused Feasibility Study (“FFS”) and proposed plan which addressed various early action remediation alternatives for the lower 8.3 miles of the River. The EPA received public comment on the FFS and proposed plan (including comments from the CPG and other entities asserting that the FFS and proposed plan do not comply with CERCLA) which public comment period ended on August 20, 2014. The CPG submitted to the EPA a draft RI report in February 2015 and draft FS report in April 2015 for the entire lower seventeen miles of the River. On March 4, 2016, the EPA issued a Record of Decision ("ROD") selecting the remedy for the lower 8.3 miles of the River. The cleanup plan adopted by the EPA is now considered a final action for the lower 8.3 miles of the River and will include the removal of 3.5 million cubic yards of sediment, placement of a cap over the entire lower 8.3 miles of the River, and, according to the EPA, will cost approximately $1.4 billion and take 6 years to implement after the remedial design is completed. On September 30, 2016, Occidental Chemical Corporation ("OCC") entered into an agreement with the EPA to perform the remedial design for the cleanup plan for the lower 8.3 miles of the River. The remedial design is expected to be substantially completed in the first quarter of 2024. On June 30, 2018, OCC filed a complaint in the United States District Court for the District of New Jersey against over 100 companies, including the Company, seeking CERCLA cost recovery or contribution for past costs relating to various investigations and cleanups OCC has conducted or is conducting in connection with the River. According to the complaint, OCC has incurred or is incurring costs which include the estimated cost ($165 million) to complete the remedial design for the cleanup plan for the lower 8.3 miles of the River. OCC also seeks a declaratory judgment to hold the defendants liable for their proper shares of future response costs for OCC's ongoing activities in connection with the River. The Company and other defendants have answered the complaint and have been engaged in discovery with OCC. On February 24, 2021, the Company and other defendants filed a third party complaint against the Passaic Valley Sewerage Commissioners and forty-two municipalities to require those entities to pay their equitable share of response costs. On October 10, 2018, the EPA issued a letter directing the CPG to prepare a streamlined feasibility study for the upper 9 miles of the River based on an iterative approach using adaptive management strategies. The CPG submitted a revi</span><span style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">sed draft Interim </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">Remedy Feasibility Study to the EPA on December 4, 2020, which identified various targeted dredge and cap alternatives with costs that range from $420 million to $468 million (net </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">present value). The EPA approved the Interim Remedy Feasibility Study on December 11, 2020. The EPA issued the Interim Remedy Proposed Plan on April 14, 2021 and the Interim Remedy ROD on September 28, 2021, selecting an alternative that the EPA estimates will cost $441 million (net present value). The CPG has substantially completed the RI/FS for the entire 17-mile River. The Company and 105 other parties received a letter dated March 31, 2016 from the EPA notifying such parties of potential liability for the costs of the cleanup of the lower 8.3 miles of the River and a letter dated March 30, 2017 stating that the EPA had offered 20 of the parties (not including the Company) an early cash out settlement. In a letter dated May 17, 2017, the EPA stated that these 20 parties did not discharge any of the eight hazardous substances identified as the contaminants of concern in the lower 8.3 mile ROD. In the March 30, 2017 letter, the EPA stated that other parties who did not discharge dioxins, furans or polychlorinated biphenyls (which are considered the contaminants of concern posing the greatest risk to human health or the environment) may also be eligible for cash out settlement, but expected those parties' allocation to be determined through a complex settlement analysis using a third-party allocator. The EPA subsequently clarified this statement to say that such parties would be eligible to be "funding parties" for the lower 8.3 mile remedial action with each party's share of the costs determined by the EPA based on the allocation process and the remaining parties would be "work parties" for the remedial action. The Company asserts that it did not discharge dioxins, furans or polychlorinated biphenyls and should be eligible to be a "funding party" for the lower 8.3 mile remedial action. The Company participated in the allocation process. The allocator selected by the EPA issued a confidential allocation report on December 28, 2020, which was reviewed by the EPA. As a result of the allocation process, on February 11, 2022, the EPA and certain parties (including the Company) reached an agreement in principle for a cash-out settlement for remediation of the entire 17-mile Lower Passaic River. On December 16, 2022, the United States lodged a Consent Decree with the United States District Court for the District of New Jersey in </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:112%">United States v. Alden Leeds, Inc. et al. </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">(No. 2:22-cv-07326) that addresses the liability of 85 parties (including the Company) for an aggregate amount of $150 million based on the EPA-sponsored allocation report that found OCC 99.4% responsible for the cleanup costs of the River. The Consent Decree was subject to a 90-day public comment period, which ended March 22, 2023. On November 21, 2023, the United States informed the Court that it concluded, based on the public comments, that a small number of parties (not including the Company) should be removed from the settlement, that a change should be made to the United States’ reservation of rights (which was agreed to by the remaining settling parties) and that it intends to file a Motion to Enter the modified Consent Decree (without soliciting additional public comments) no later than January 31, 2024. On December 12, 2023, the Court ordered the United States to file the proposed modified Consent Decree on or before January 17, 2024 and its Motion to Enter the modified Consent Decree no later than January 31, 2024 and established a schedule to complete briefing by July 2024. After the United States moves to enter the modified Consent Decree the Court will enter or disapprove. On December 20, 2022, various defendants (including the Company) in the OCC litigation filed an unopposed motion to stay the litigation for six months which was granted by the Court on March 1, 2023. On March 2, 2023, the EPA issued a Unilateral Administrative Order requiring OCC to design the interim remedy for the upper 9 miles of the River (the “2023 UAO”). Notwithstanding the stay of the litigation commenced in 2018 (and two days after the public comment period on the Consent Decree closed), OCC filed a complaint named </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:112%">Occidental Chem. Corp. v. Givaudan Fragrances Corp., et al.</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">, No. 2:23‑cv-1699 at 2, 5 (D.N.J. Mar. 24, 2023) (the “2023 Litigation”) against forty parties (not including the Company) for recovery of past and future response costs it will incur in complying with the 2023 UAO. All of the defendants named in the 2023 Litigation are also defendants or third-party defendants in the litigation commenced in 2018. Pursuant to a settlement agreement by and among the Maxus Liquidating Trust, YPF and Repsol submitted to the bankruptcy court on April 7, 2023, YPF and Repsol will jointly pay a combined sum of $573 million to various creditors. Based on the waterfall payout of the bankruptcy plan, it is currently estimated that the CPG will receive approximately $9 million, which will be used either to offset future CPG costs, including EPA RI/FS oversight and legal and administrative costs, or to reimburse CPG members for a portion of their past contributions to the RI/FS costs</span><span style="color:#008080;font-family:'Times New Roman',sans-serif;font-size:12pt;font-weight:400;line-height:112%">.</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%"> At this time, the Company cannot reasonably estimate its liability related to the litigation and remediation efforts, excluding the RI/FS and remediation actions at mile 10.9, as the OCC litigation is pending and the EPA settlement process has not been completed and requires court approval.</span></div><div><span><br/></span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:112%">Per the terms of a Final Order and Judgment approved by the United States District Court for the Middle District of Florida on January 22, 1991, Emhart is responsible for a percentage of remedial costs arising out of the Kerr McGee Chemical Corporation Superfund Site located in Jacksonville, Florida. On March 15, 2017, the Company received formal notification from the EPA that the EPA had issued a ROD selecting the preferred alternative identified in the Proposed Cleanup Plan. On or about November 2, 2023, the Multistate Trust managing the remediation revised the estimated remediation costs for work to be performed in 2024, and the Company adjusted the reserve for its percentage share of such costs accordingly. As of December 30, 2023, the Company has reserved $28.2 million for this site.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The environmental liability for certain sites that have cash payments beyond the current year that are fixed or reliably determinable have been discounted using a rate of 4.4% to 5.5%, depending on the expected timing of disbursements. The discounted and undiscounted amount of the liability relative to these sites is $34.3 million and $47.0 million, respectively. The payments relative to these sites are expected to be $3.2 million in 2024, $3.2 million in 2025, $3.2 million in 2026, $2.4 million in 2027, $2.4 million in 2028, and $32.6 million thereafter.</span></div><div style="margin-top:9pt"><span style="background-color:#ffffff;color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The amount recorded for identified contingent liabilities is based on </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">estimates. Amounts recorded are reviewed periodically and adjusted to reflect additional technical and legal information that becomes available. Actual costs to be incurred in future periods may vary from the estimates, given the inherent uncertainties in evaluating certain exposures. Subject to the imprecision </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">in estimating future contingent liability costs, the Company does not expect that any sum it may have to pay in connection with these environmental matters in excess of the amounts recorded will have a materially adverse effect on its financial position, results of operations or liquidity.</span></div>
CY2023Q4 swk Superfund Sites
SuperfundSites
23 site
CY2022 swk Environmental Loss Contingency Statement Of Financial Position Extensible Enumeration Not Disclosed Flag
EnvironmentalLossContingencyStatementOfFinancialPositionExtensibleEnumerationNotDisclosedFlag
reserves
CY2023 swk Environmental Loss Contingency Statement Of Financial Position Extensible Enumeration Not Disclosed Flag
EnvironmentalLossContingencyStatementOfFinancialPositionExtensibleEnumerationNotDisclosedFlag
reserves
CY2023 swk Environmental Loss Contingency Noncurrent Statement Of Financial Position Extensible Enumeration Not Disclosed Flag
EnvironmentalLossContingencyNoncurrentStatementOfFinancialPositionExtensibleEnumerationNotDisclosedFlag
long-term
CY2023Q4 us-gaap Other Assets Miscellaneous
OtherAssetsMiscellaneous
17000000 usd
CY2023 swk Environmentalremediation.Periodconstructionoftreatmentfacilitytobemaintained
Environmentalremediation.Periodconstructionoftreatmentfacilitytobemaintained
P30Y
CY2007Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
17 mi
CY2012Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
10.9 mi
CY2012Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
10.9 mi
CY2014Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2015Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
17 mi
CY2016Q1 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2014Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2016Q1 swk Environmental Remediation Cubic Yards Of Sediment
EnvironmentalRemediationCubicYardsOfSediment
3500000 cubic_yard
CY2014Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2016Q1 us-gaap Environmental Exit Costs Anticipated Cost
EnvironmentalExitCostsAnticipatedCost
1400000000 usd
CY2016Q1 swk Environmental Remediation Estimated Remedial Design Implementation Period
EnvironmentalRemediationEstimatedRemedialDesignImplementationPeriod
P6Y
CY2016Q3 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2018Q2 us-gaap Loss Contingency Number Of Defendants
LossContingencyNumberOfDefendants
100 company
CY2018Q2 swk Environmental Remediation Estimated Remedial Design Cleanup Cost
EnvironmentalRemediationEstimatedRemedialDesignCleanupCost
165000000 usd
CY2018Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2018Q2 swk Environmental Remediation Number Of Municipalities Suit Filed
EnvironmentalRemediationNumberOfMunicipalitiesSuitFiled
42 municipality
CY2018Q4 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
9 mi
CY2021Q2 us-gaap Environmental Exit Costs Anticipated Cost
EnvironmentalExitCostsAnticipatedCost
441000000 usd
CY2021Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
17 mi
CY2016Q1 swk Environmental Remediation Number Of Other Parties Notified
EnvironmentalRemediationNumberOfOtherPartiesNotified
105 company
CY2016Q1 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2017Q1 swk Number Of Other Companies Offered Cash Out Settlements
NumberOfOtherCompaniesOfferedCashOutSettlements
20 company
CY2017Q2 swk Number Of Other Companies Offered Cash Out Settlements
NumberOfOtherCompaniesOfferedCashOutSettlements
20 company
CY2017Q2 swk Environmental Remediation Number Of Hazardous Substances
EnvironmentalRemediationNumberOfHazardousSubstances
8 hazardoussubstance
CY2017Q2 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2017Q1 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2017Q1 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
8.3 mi
CY2022Q1 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
17 mi
CY2022Q4 swk Environmental Remediation Number Of Parties
EnvironmentalRemediationNumberOfParties
85 company
CY2022Q4 us-gaap Environmental Exit Costs Anticipated Cost
EnvironmentalExitCostsAnticipatedCost
150000000 usd
CY2022Q4 swk Environmental Exit Costs Anticipated Cost Percentage
EnvironmentalExitCostsAnticipatedCostPercentage
0.994
CY2023Q1 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
9 mi
CY2023Q1 swk Environmental Remediation Number Of Parties
EnvironmentalRemediationNumberOfParties
40 company
CY2022Q4 swk Environmental Remedial Investigation Feasibility Study Number Of Miles
EnvironmentalRemedialInvestigationFeasibilityStudyNumberOfMiles
10.9 mi
CY2023 swk Environmental Remediation Expense Statement Of Income Or Comprehensive Income Extensible Enumeration Not Disclosed Flag
EnvironmentalRemediationExpenseStatementOfIncomeOrComprehensiveIncomeExtensibleEnumerationNotDisclosedFlag
estimated remediation costs
CY2023Q4 us-gaap Accrual For Environmental Loss Contingencies Undiscounted Due Within One Year
AccrualForEnvironmentalLossContingenciesUndiscountedDueWithinOneYear
3200000 usd
CY2023Q4 us-gaap Accrual For Environmental Loss Contingencies Undiscounted Due In Second Year
AccrualForEnvironmentalLossContingenciesUndiscountedDueInSecondYear
3200000 usd
CY2023Q4 us-gaap Accrual For Environmental Loss Contingencies Undiscounted Due In Third Year
AccrualForEnvironmentalLossContingenciesUndiscountedDueInThirdYear
3200000 usd
CY2023Q4 us-gaap Accrual For Environmental Loss Contingencies Undiscounted Due In Fourth Year
AccrualForEnvironmentalLossContingenciesUndiscountedDueInFourthYear
2400000 usd
CY2023Q4 us-gaap Accrual For Environmental Loss Contingencies Undiscounted Due In Fifth Year
AccrualForEnvironmentalLossContingenciesUndiscountedDueInFifthYear
2400000 usd

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