NEW YORK -(Dow Jones)- Stanley Black & Decker Inc.'s (SWK) fourth-quarter earnings surged and the tool giant offered a rosy outlook for the coming year as benefits from its recent blockbuster merger exceeded its expectations.

The company, formed in March when Stanley Works bought Black & Decker for $4.5 billion worth of stock, has seen revenue and profit soar because of the combination, and expects additional benefits from a rebound in construction, industrial and security products. Executives said the company is seeing merger-related increases in revenue and cost savings both faster and larger than it originally expected, and it hinted a dividend boost is coming in the near term.

Donald Allan Jr., chief financial officer, said the benefits, along with a stronger outlook and cash-flow picture, means that "management will be reviewing the timing and magnitude of the company's dividend increase at its upcoming February board meeting, two quarters earlier in the year than normal."

Stanley Black & Decker reported a profit of $137.8 million, up from $74.3 million a year earlier, on revenue that more than doubled to $2.41 billion year over year. Per-share profit fell to 81 cents from 91 cents, as the number of shares outstanding was up over twofold due to the merger. Excluding items such as costs relating to the merger, earnings were $1.05 in the most recent quarter.

Analysts polled by Thomson Reuters had most recently forecast earnings of 92 cents on $2.38 billion in revenue.

While the quarter and outlook were strong overall, gross margin did fall slightly, both quarter over quarter and year over year, but the company said synergies from the merger made the third-quarter to fourth-quarter decline smaller than it historically has been. The effects of foreign currency crimped revenue by 1% during the quarter, but for the full year overall, the effect on the top line was flat, and it said "foreign exchange should not have a significant impact" on its 2011 projections.

Stanley Black & Decker forecast current-year earnings of $4.75 to $5 a share, 2 cents to 27 cents better than the consensus estimate.

Shares, which closed Wednesday at $66.95 apiece and are up 28% over the past year, rose nearly 3% in Thursday premarket trading to $68.90 a share.

-Nathan Becker contributed to this article.

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