Tools & Storage net sales increased 5% versus 2Q'15 as volume (+7%) and price (+1%) more than offset unfavorable currency (-3%).
All regions posted solid organic growth with North America +7%, Europe +14%, and emerging markets +4%. Share gains in North America continued amidst a still healthy underlying U.S. construction tool market aided by solid commercial execution and new products, overcoming modest pressure within industrial channels.
Organic growth momentum in Europe continued with most markets up double digits, as new products, targeted growth investments and an expanded retail footprint generated share gains across the region.
Organic growth within the emerging markets, which continue to remain challenging, reflects successful commercial execution surrounding our mid-price-point product releases as well as regional pricing actions.
Overall Tools & Storage segment profit rate was 18.8%, a post-merger record, up from the 2Q'15 rate of 16.4%, as volume leverage, price, productivity, cost management and lower commodity prices more than offset currency.
Security net sales increased 1% versus 2Q'15 as price (+1%) and bolt-on, recurring revenue acquisitions (+1%) were partially offset by currency (-1%).
Organic growth continued in Europe (+3%) on higher installation revenues across much of the region, while North America's organic revenues were down slightly (-2%) as lower commercial electronic security volumes more than offset higher automatic door revenues.
Overall Security segment profit rate expanded 220 basis points versus prior year to 12.6%, the highest second quarter rate since 2013, as improved operating performance continued in both North America and Europe.
Industrial net sales decreased 6% versus 2Q'15 due to lower volumes (-6%). Engineered Fastening organic revenues declined 4% due primarily to lower electronics volumes attributable to one major customer.
Infrastructure organic revenues decreased 11% due to a slowdown in Oil & Gas off-shore project activity as well as the impact of a difficult scrap steel market on Hydraulic Tools volumes.
Overall Industrial segment profit rate was 17.0%, down 210 basis points from the 2Q'15 rate, as lower volumes and currency more than offset productivity gains and cost control. ■
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