BUSINESS SEGMENTS AND GEOGRAPHIC AREAS

12 Months Ended

Dec. 29, 2012

Segment Reporting [Abstract]

BUSINESS SEGMENTS AND GEOGRAPHIC AREAS

 BUSINESS SEGMENTS AND GEOGRAPHIC AREAS

The Company classifies its business into three reportable segments, which also represent its operating segments: Construction & Do It Yourself (“CDIY”), Security, and Industrial.

The CDIY segment is comprised of the Professional Power Tool and Accessories business, the Consumer Power Tool business and the Hand Tools, Fasteners & Storage business. The Professional Power Tool and Accessories business sells professional grade corded and cordless electric power tools and equipment including drills, impact wrenches and drivers, grinders, saws, routers and sanders. The Consumer Power Tool business sells corded and cordless electric power tools, lawn and garden products and home products. The Hand Tools, Fasteners & Storage business sells measuring and leveling tools, planes, hammers, demolition tools, knives, saws and chisels. Fastening products include pneumatic tools and fasteners including nail guns, nails, staplers and staples. Storage products include tool boxes, sawhorses and storage units.

The Security segment is comprised of the Convergent Security Solutions ("CSS") and the Mechanical Access Solutions ("MAS") businesses. The CSS business designs, supplies and installs electronic security systems and provides electronic security services, including alarm monitoring, video surveillance, fire alarm monitoring, systems integration and system maintenance. Purchasers of these systems typically contract for ongoing security systems monitoring and maintenance at the time of initial equipment installation. The business also includes healthcare solutions, which markets medical carts and cabinets, asset tracking, infant protection, pediatric protection, patient protection, wander management, fall management, and emergency call products. The MAS business sells automatic doors, commercial hardware, locking mechanisms, electronic keyless entry systems, keying systems, tubular and mortise door locksets.

The Industrial segment is comprised of the Industrial and Automotive Repair ("IAR"), Engineered Fastening and Infrastructure businesses. The IAR business sells hand tools, power tools, and engineered storage solution products. The Engineered Fastening business primarily sells engineered fasteners designed for specific applications. The product lines include stud welding systems, blind rivets and tools, blind inserts and tools, drawn arc weld studs, engineered plastic fasteners, self-piercing riveting systems and precision nut running systems. The Infrastructure business consists of the CRC-Evans business and the Company’s Hydraulics business. The product lines include custom pipe handling machinery, joint welding and coating machinery, weld inspection services and hydraulic tools and accessories.

As discussed in Note A, Significant Accounting Policies, the Merger with Black & Decker occurred on the close of business on March 12, 2010. The results of Black & Decker’s operations are presented within each of these segments and reflect activity since the Merger date.

The Company utilizes segment profit, which is defined as net sales minus cost of sales and SG&A inclusive of the provision for doubtful accounts (aside from corporate overhead expense), and segment profit as a percentage of net sales to assess the profitability of each segment. Segment profit excludes the corporate overhead expense element of SG&A, interest income, interest expense, other-net (inclusive of intangible asset amortization expense), restructuring, loss on debt extinguishment and income tax expense. Refer to Note O, Restructuring and Asset Impairments, for the amount of restructuring charges and asset impairments by segment, and to Note F, Goodwill and Intangible Assets, for intangible amortization expense by segment. Corporate overhead is comprised of world headquarters facility expense, cost for the executive management team and cost for certain centralized functions that benefit the entire Company but are not directly attributable to the businesses, such as legal and corporate finance functions. Transactions between segments are not material. Segment assets primarily include accounts receivable, inventory, other current assets, property, plant and equipment, intangible assets and other miscellaneous assets.

Corporate assets and unallocated assets are cash and deferred income taxes. Geographic net sales and long-lived assets are attributed to the geographic regions based on the geographic location of each Company subsidiary.

BUSINESS SEGMENTS

(Millions of Dollars)	2012			2011			2010
Net Sales
CDIY	$	5,193.7		$	5,007.6		$	4,147.6
Security	2,428.9			1,926.5			1,457.6
Industrial	2,567.9			2,501.4			1,891.7
Consolidated	$	10,190.5		$	9,435.5		$	7,496.9
Segment Profit
CDIY	$	720.7		$	634.8		$	422.6
Security	305.6			297.1			252.9
Industrial	410.2			400.7			255.5
Segment Profit	1,436.5			1,332.6			931.0
Corporate overhead	(252.3		)	(245.3		)	(244.7		)
Other-net	(301.9		)	(255.7		)	(184.9		)
Restructuring charges and asset impairments	(175.1		)	(69.3		)	(231.7		)
Loss on debt extinguishment	(45.5		)	—			—
Interest income	10.1			26.5			8.7
Interest expense	(144.2		)	(140.4		)	(109.8		)
Earnings from continuing operations before income taxes	$	527.6		$	648.4		$	168.6
Capital and Software Expenditures
CDIY	$	199.0		$	160.7		$	97.4
Security	65.3			49.3			27.8
Industrial	109.9			73.4			46.2
Discontinued operations	11.8			18.7			14.1
Consolidated	$	386.0		$	302.1		$	185.5
Depreciation and Amortization
CDIY	$	139.7		$	132.2		$	114.4
Security	150.2			130.9			116.2
Industrial	116.7			106.3			75.2
Discontinued operations	38.7			40.7			42.9
Consolidated	$	445.3		$	410.1		$	348.7
Segment Assets
CDIY	$	7,439.7		$	7,474.4		$	7,392.6
Security	4,728.9			4,152.1			2,327.2
Industrial	3,456.9			3,282.9			3,128.5
	15,625.5			14,909.4			12,848.3
Discontinued operations	133.4			1,050.2			1,201.4
Corporate assets	85.1			(10.6		)	1,089.7
Consolidated	$	15,844.0		$	15,949.0		$	15,139.4

Corporate assets primarily consist of cash, deferred taxes, and property, plant and equipment. The decrease in 2011 corporate assets from 2010 was primarily due to the cash spent to fund the acquisition of Niscayah.

Sales to the Home Depot were 14%, 13% and 14% of the CDIY segment net sales in 2012, 2011 and 2010, respectively. Sales to Lowes were 18%, 17% and 14% of the CDIY segment net sales in 2012, 2011 and 2010, respectively.

In 2012 the Company recorded $168 million of facility closure-related and other charges associated with the merger and other acquisitions across all segments, impacting segment profit by $42 million in CDIY, $41 million in Security, and $8 million in Industrial for the year ended December 29, 2012, with the remainder residing in corporate overhead.

In 2011 the Company recorded $120 million of facility closure-related and other charges associated with the merger and other acquisitions across all segments, impacting segment profit by $20 million in CDIY, $15 million in Security, and $9 million in Industrial for the year ended December 31, 2011, with the remainder residing in corporate overhead.

In 2010 the Company recorded $228 million of facility closure-related and other charges associated with the Merger and other acquisitions across all segments, impacting segment profit by $120 million in CDIY and $26 million in Industrial for the year ended January 1, 2011, with the remainder residing in corporate overhead. There were no charges impacting the Security segment for the year ended January 1, 2011.

GEOGRAPHIC AREAS

(Millions of Dollars)	2012		2011		2010
Net Sales
United States	$	4,873.2	$	4,517.2	$	3,965.6
Canada	579.3		548.9		461.0
Other Americas	805.3		753.6		354.8
France	703.3		706.6		671.6
Other Europe	2,444.7		2,208.2		1,325.7
Asia	784.7		701.0		718.2
Consolidated	$	10,190.5	$	9,435.5	$	7,496.9
Property, Plant & Equipment
United States	$	572.9	$	503.6	$	433.2
Canada	19.3		19.9		16.6
Other Americas	88.5		94.8		183.8
France	71.1		60.1		56.7
Other Europe	329.5		264.2		182.7
Asia	252.4		200.0		188.4
Consolidated	$	1,333.7	$	1,142.6	$	1,061.4