Black & Decker 2010 Annual Report Download - page 60

CAUTIONARY STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION REFORM
ACT OF 1995
Certain statements contained in this Annual Report on Form 10-K that are not historical, including but not
limited to those regarding the Company’s ability to: (i) achieve $425 million or more in cost synergies by the
end of 2012 in connection with the integration of Black & Decker: $165 million in 2011 and $125 million in
2012; (ii) achieve $300 million to $400 million in revenue synergies by 2013 resulting from the Merger, which
implies a benefit of $0.35 to $0.50 of earnings per diluted share; (iii) utilize merger related cost synergies to
fuel future growth and facilitate global cost leadership; (iv) add an incremental 50 basis points to 2011
revenues (approximately $50 million) as a result of Merger related revenue synergies and achieve a modest
earnings impact, with remaining revenue synergies to be achieved in 2012 and 2013; (v) reduce the proportion
of sales to U.S. home centers and mass merchant customers; (vi) meet its long term financial objectives
including: 4-6% organic revenue growth; 10-12% total revenue growth; mid-teens EPS growth; free cash flow
greater than equal to net income; ROCE between 12-15%; continued dividend growth; and a strong investment
grade credit rating; (vii) meet its long term capital allocation objectives pertaining to free cash flow including,
targeting a strong investment grade credit rating, investing approximately 2⁄3in acquisitions and growth and
returning approximately 1⁄3to shareowners; (viii) further leverage SFS to generate ongoing improvements in
working capital turns, cycle times, complexity reduction and customer service levels; and (ix) generate full
year 2011 EPS in the range of $4.29 to $4.54 per diluted share, and excluding the effects of merger and
acquisition related charges, in the range of $4.75 to $5.00 per diluted share (collectively, the “Results”); are
“forward looking statements” and subject to risk and uncertainty.
These forward looking statements are not guarantees of future performance and involve certain risks,
uncertainties and assumptions that are difficult to predict. There are a number of risks, uncertainties and
important factors that could cause actual results to differ materially from those indicated by such forward-
looking statements. In addition to any such risks, uncertainties and other factors discussed elsewhere herein,
the risks, uncertainties and other factors that could cause or contribute to actual results differing materially
from those expressed or implied in the forward looking statements include, without limitation, those set forth
under Item 1A Risk Factors hereto and any material changes thereto set forth in any subsequent Quarterly
Reports on Form 10-Q, the Company’s other filings with the Securities and Exchange Commission, and those
set forth below.
The Company’s ability to deliver the Results is dependent, or based, upon: (i) the Company’s ability to
effectively execute its integration plans to identify and estimate key synergy drivers; achieve the cost and
revenue synergies, capitalize on growth opportunities and achieve the anticipated results of the Merger; (ii) the
Company’s success in driving brand expansion, achieving increased access to global markets through
established distribution channels and cross selling opportunities; (iii) the ability of the Company to generate
organic net sales increase of 5-6%, from a combined Company pro-forma level of $9.3 billion; (iv) the
Company’s ability to achieve revenue synergy increase of 50 bps to 2011 revenues with modest EPS impact;
(v) the Company achieving operating margin rate expansion of approximately 150 bps versus 2010; (vi) achiev-
ing a tax rate of approximately 25% — 26%; (vii) non-merger and acquisition related restructuring, impairment
and related charges remaining relatively flat to those in 2010; (viii) the Company’s success at limiting the cost
to achieve cost synergies to $200 million over the next two years; (ix) the Company’s ability to limit costs
associated with severance and facilities closures to $90 million in 2011; (x) one-time costs to be recorded in
SG&A and “other-net” being $15 million for certain compensation charges, advisory and consulting fees;
(xi) almost no impact from price and inflation based on no significant increase in commodity levels;
(xii) successful identification, consummation and of acquisitions, as well as integration of existing businesses,
that enhance the Company’s growth and long term objectives; (xiii) the continued acceptance of technologies
used in the Company’s products and services; (xiv) the Company’s ability to manage existing Sonitrol
franchisee and Mac Tools distributor relationships; (xv) the Company’s ability to minimize costs associated
with any sale or discontinuance of a business or product line, including any severance, restructuring, legal or
other costs; (xvi) the proceeds realized with respect to any business or product line disposals; (xvii) the extent
of any asset impairments with respect to any businesses or product lines that are sold or discontinued as well
as the Company’s ability to test and analyze the possibility of asset impairment; (xviii) the success of the
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