Record Profit

TTI recorded US$80 million in net profit attributable to shareholders, a 72.8% increase in the first half of 2011. Total Group sales in the first half were US$1.78 billion, an increase of 11.0% over the same period in 2010. This growth was achieved through new product introductions across all businesses and significant expansion in industrial tools and accessories. Our new product vitality rate continued at approximately one third of sales. Basic earnings per share improved to US5.00 cents, an increase of 71.2% compared to the same period last year.

The Power Equipment business delivered a robust 11.3% growth in sales led by our MILWAUKEE®, RYOBI®, and AEG® brands. Our North American business achieved high single-digit growth, while the rest of world business grew double-digit. The Floor Care and Appliances business grew sales by 10.4%, led by the continuation of product innovation under the HOOVER®, DIRT DEVIL® and VAX® brands.

Operational Efficiencies Deliver Margin Improvements

Our gross margin increased to 32.9% from 32.6% in the first half of 2010. Accelerated productivity improvements were generated through value engineering, lean manufacturing, and supply chain efficiency programs to help offset inflationary pressures. SG&A expenses improved from 26.8% of sales in the first half of last year to 26.6%, while we continued investing in advertising and promotion to support new product introductions and strategic brand building initiatives.

The Company continues to manage working capital prudently to maintain financial flexibility and fund growth. In the first half, working capital as a percentage of sales improved to 20.1% compared to 21.2% for the same period last year.