The Company completed the sale of its Infrastructure business to Epiroc AB for $760 million on April 1, 2024. The company received proceeds of $728.5 million at closing, net of customary adjustments and costs.

The company's Global Cost Reduction Program is expected to generate $2.0 billion in pre-tax run-rate savings by the end of 2025, consisting of $500 million in SG&A savings and $1.5 billion in supply chain transformation savings. The company generated approximately $295 million of pre-tax run-rate savings during the first six months of 2024.

SG&A, excluding Non-GAAP adjustments, was 19.9% of net sales for the three months ended June 29, 2024, compared to 19.5% for the three months ended July 1, 2023, as the Company increased investments to position the business to gain additional market share.

The company has reduced inventory by approximately $2.1 billion since the end of the second quarter of 2022 and expects further inventory and working capital reductions to support free cash flow generation in 2024.

The Company's primary areas of multi-year strategic focus remain unchanged as follows: Advancing innovation, electrification and global market penetration; Streamlining and simplifying the organization, and investing in initiatives that more directly impact the Company's customers and end users; Returning adjusted gross margins to historical 35%+ levels; Prioritizing cash flow generation and inventory optimization.

The Company expects to achieve annual net cost savings of approximately $104 million related to the 2024 restructuring actions. The majority of the $42.3 million of reserves remaining as of June 29, 2024 is expected to be utilized within the next 12 months.

The Company was notified by the CPSC 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. The Company believes there are defenses to the Division's claims.

The Company has identified certain transactions relating to its international operations that may raise compliance questions under the U.S. Foreign Corrupt Practices Act and has voluntarily disclosed this information to the DOJ and the SEC.

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.

Tools & Outdoor net sales were flat compared to the second quarter of 2023, with DEWALT® and outdoor leading volume gains of 2% that were partially offset by a 1% decrease in both foreign currency and price.

Engineered Fastening organic revenues increased 2%, driven by aerospace growth which offset market softness in automotive and general industrial.

During the second quarter of 2024, the U.S. retail point-of-sale demand was up modestly versus the prior year led by outdoor growth and recaptured DEWALT® cordless promotions.

The Company believes that it is on track to grow to approximately $2 billion of pre-tax run-rate savings by year-end 2025. In addition, the Company has reduced inventory by approximately $2.1 billion since the end of the second quarter of 2022.

The supply chain transformation is expected to deliver $1.5 billion of pre-tax run-rate cost savings by the end of 2025 to achieve projected 35%+ adjusted gross margins.

Distribution center costs (i.e. warehousing and fulfillment facility and associated labor costs) are classified within SG&A. This classification may differ from other companies who may report such expenses within cost of sales.

The SG&A cost savings are expected to be generated by simplifying the corporate structure, optimizing organizational spans and layers and reducing indirect spend. These savings will help fund $300 million to $500 million of innovation and commercial investments through 2025 designed to accelerate organic growth.

Important factors that could cause the Company's actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in its forward-looking statements include the Company's ability to keep abreast with the pace of technological change.

Important factors that could cause the Company's actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in its forward-looking statements include the Company's ability to successfully adopt new technology, meet market-driven demands for carbon neutral and renewable energy technology, or to comply with changes in environmental regulations or requirements.

In terms of capital allocation, the Company remains committed, over time, to returning excess capital to shareholders through a strong and growing dividend as well as opportunistically repurchasing shares. In the near term, the Company intends to direct any capital in excess of the quarterly dividend on its common stock toward debt reduction and internal growth investments.

Company expects second half free cash flow to fund the cash dividend and support an additional $400 million to $500 million short term debt reduction by the end of 2024.

In June 2024, the Company amended the settlement date to June 2026, or earlier at the Company's option, for a forward share purchase contract with a financial institution counterparty for 3,645,510 shares of common stock.

Important factors that could cause the Company's actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in its forward-looking statements include risks related to the transition to a lower-carbon economy, such as the Company's ability to successfully adopt new technology, meet market-driven demands for carbon neutral and renewable energy technology, or to comply with changes in environmental regulations or requirements.

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.

Based on the regulatory changes, and remedial developments currently contemplated by the EPA and the State of Rhode Island, the Company has increased its reserve for this site by $142.3 million in the second quarter of 2024.

Important factors that could cause the Company's actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in its forward-looking statements include macroeconomic factors, including global and regional business conditions, commodity prices, inflation and deflation, interest rate volatility, currency exchange rates, and uncertainties in the global financial markets related to the recent failures of several financial institutions.

Important factors that could cause the Company's actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in its forward-looking statements include laws, regulations and governmental policies affecting the Company's activities in the countries where it does business, including those related to tariffs, taxation, data privacy, anti-bribery, anti-corruption, government contracts and trade controls such as section 301 tariffs and section 232 steel and aluminum tariffs.

Important factors that could cause the Company's actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in its forward-looking statements include potential business, supply chain and distribution disruptions, including those related to physical security threats, information technology or cyber-attacks, epidemics, natural disasters, pandemics, sanctions, political unrest, war or terrorism, including the conflicts between Russia and Ukraine, and Israel and Hamas and tensions or conflicts in South Korea, China and Taiwan.