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ITW Reports a 26 Percent Decrease in Operating Revenues for Three Months Ended May 31, 2009; Base Revenues Show Ongoing Stabilization; Return of Decorative Surfaces Segment to Continuing Operations Adds 4 Cents of Earnings to Revised Second Quarter 2009 F

Posted on: Monday, 15 June 2009, 07:00 CDT

GLENVIEW, Ill., June 15 /PRNewswire-FirstCall/ -- Illinois Tool Works Inc. (NYSE: ITW) today reported an operating revenue decrease of 26 percent for the three months ended May 31, 2009. The revenue decline for the three months was due to a 23 percent decrease in base revenues and a 9 percent decline in contributions from currency translation. Acquisitions contributed 6 percent to revenues in the three month period. The Company's base revenues continue to stabilize as core revenues have been in a range of -21 percent to -25 percent for the past 5 months of January through May 2009.

On a segment basis, the Company's three month moving average percentage change for operating revenues, comprised of base revenues, acquisitions/divestitures and currency translation, is provided below.

Due to the Decorative Surfaces segment being placed back into continuing operations as was announced on May 8, 2009, the segment is expected to add four cents to income per share from continuing operations in the current quarter. As a result, the Company is now forecasting second quarter 2009 diluted income per share from continuing operations to be in a range of $0.29 to $0.41. On a restated basis, Decorative Surfaces also added four cents of earnings to ITW's 2009 first quarter results. The updated second quarter forecast assumes a total revenue improvement of 5 percent to 11 percent compared to the restated first quarter of 2009.

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitations, statements regarding operating revenues, the Decorative Surfaces segment, diluted income per share from continuing operations and the Company's related forecasts. These statements are subject to certain risks, uncertainties and other factors that could cause actual results to differ materially from those anticipated. Important factors that could cause actual results to differ materially from the Company's expectations are set forth in ITW's Form 10-Q for the 2009 first quarter.

With $15.9 billion in revenues, ITW is a multinational manufacturer of a diversified range of value-adding and short lead-time industrial products and equipment. The Company consists of 875 business units in 54 countries and employs some 61,000 people.

ILLINOIS TOOL WORKS INC. and SUBSIDIARIES 2008 & 2009 PRO FORMA STATEMENT OF INCOME RESTATED FOR DECORATIVE SURFACES SEGMENT (UNAUDITED) (In thousands except for per share amounts) 1Q 2008 2Q 2008 3Q 2008 4Q 2008 Operating Revenues $4,125,810 $4,555,881 $4,464,621 $3,954,029 Cost of revenues 2,692,485 2,941,457 2,936,599 2,616,330 Selling, administrative, and R&D expenses 773,117 814,962 806,533 831,587 Amortization of intangible assets 40,139 42,303 50,491 51,477 Impairment of goodwill and other 1,438 - - 137 intangible assets Operating Income 618,631 757,159 670,998 454,498 Interest expense (37,467) (36,588) (38,240) (42,163) Other income (expense) (21,133) 24,294 16,763 (15,214) Income from Continuing Operations Before Income Taxes 560,031 744,865 649,521 397,121 Income taxes 164,693 216,161 184,935 94,656 Income (Loss) from Continuing Operations 395,338 528,704 464,586 302,465 Loss from Discontinued Operations (91,717) (614) (11,068) (68,691) Net Income (Loss) $303,621 $528,090 $453,518 $233,774 Income (Loss) Per Share From Continuing Operations: Basic $0.75 $1.01 $0.90 $0.59 Diluted $0.75 $1.01 $0.89 $0.59 Loss Per Share from Discontinued Operations: Basic $(0.17) $(0.00) $(0.02) $(0.13) Diluted $(0.17) $(0.00) $(0.02) $(0.13) Net Income (Loss) Per Share: Basic $0.58 $1.01 $0.88 $0.46 Diluted $0.57 $1.01 $0.87 $0.46 Shares of Common Stock Outstanding During the Period: Average 526,299 521,488 517,914 508,851 Average assuming dilution 529,725 525,209 521,086 510,184 YTD 2008 1Q 2009 Operating Revenues $17,100,341 $3,146,379 Cost of revenues 11,186,871 2,152,827 Selling, administrative, and R&D expenses 3,226,199 761,691 Amortization of intangible assets 184,410 50,570 Impairment of goodwill and other intangible assets 1,575 89,997 Operating Income 2,501,286 91,294 Interest expense (154,458) (31,436) Other income (expense) 4,710 (4,341) Income from Continuing Operations Before Income Taxes 2,351,538 55,517 Income taxes 660,445 63,533 Income (Loss) from Continuing Operations 1,691,093 (8,016) Loss from Discontinued Operations (172,090) (31,358) Net Income (Loss) $1,519,003 $(39,374) Income (Loss) Per Share from Continuing Operations: Basic $3.26 $(0.02) Diluted $3.24 $(0.02) Loss Per Share from Discontinued Operations: Basic $(0.33) $(0.06) Diluted $(0.33) $(0.06) Net Income (Loss) Per Share: Basic $2.93 $(0.08) Diluted $2.91 $(0.08) Shares of Common Stock Outstanding During the Period: Average 518,609 499,189 Average assuming dilution 521,213 499,189

ILLINOIS TOOL WORKS INC. and SUBSIDIARIES 2008 & 2009 PRO FORMA SEGMENT INFORMATION RESTATED FOR DECORATIVE SURFACES SEGMENT (UNAUDITED) (Dollars in thousands) 1Q 2008 2Q 2008 3Q 2008 4Q 2008 Industrial Packaging Operating Revenues $629,750 $717,986 $694,322 $576,864 Operating Income Loss) 70,106 94,958 77,884 40,474 Margin % 11.1% 13.2% 11.2% 7.0% Power Systems & Electronics Operating Revenues 582,391 648,785 620,743 504,934 Operating Income 124,763 142,124 118,910 78,531 Margin % 21.4% 21.9% 19.2% 15.6% Transportation Operating Revenues 594,090 630,427 581,865 540,984 Operating Income (Loss) 91,702 99,705 68,753 16,740 Margin % 15.4% 15.8% 11.8% 3.1% Food Equipment Operating Revenues 509,739 538,479 542,687 542,281 Operating Income 70,316 73,675 88,194 88,682 Margin % 13.8% 13.7% 16.3% 16.4% Construction Products Operating Revenues 484,034 566,172 525,005 415,472 Operating Income (Loss) 52,179 80,044 75,040 37,559 Margin % 10.8% 14.1% 14.3% 9.0% Polymers & Fluids Operating Revenues 255,511 299,249 369,369 325,524 Operating Income (Loss) 35,916 53,677 53,629 36,818 Margin % 14.1% 17.9% 14.5% 11.3% Decorative Surfaces Operating Revenues 302,535 335,956 316,867 275,637 Operating Income 34,298 46,761 27,137 34,386 Margin % 11.3% 13.9% 8.6% 12.5% All Other Operating Revenues 781,890 833,786 828,006 783,245 Operating Income 139,351 166,215 161,451 121,308 Margin % 17.8% 19.9% 19.5% 15.5% Intercompany Revenue $(14,130) $(14,959) $(14,243) $(10,912) As Reported on Statement of Income Operating Revenues $4,125,810 $4,555,881 $4,464,621 $3,954,029 Operating Income 618,631 757,159 670,998 454,498 Margin % 15.0% 16.6% 15.0% 11.5% YTD 2008 1Q 2009 Industrial Packaging Operating Revenues $2,618,922 $426,145 Operating Income (Loss) 283,422 (2,610) Margin % 10.8% (0.6)% Power Systems & Electronics Operating Revenues 2,356,853 395,455 Operating Income 464,328 25,365 Margin % 19.7% 6.4% Transportation Operating Revenues 2,347,366 434,634 Operating Income (Loss) 276,900 (16,448) Margin % 11.8% (3.8)% Food Equipment Operating Revenues 2,133,186 431,200 Operating Income 320,867 44,403 Margin % 15.0% 10.3% Construction Products Operating Revenues 1,990,683 323,987 Operating Income (Loss) 244,822 (10,220) Margin % 12.3% (3.2)% Polymers & Fluids Operating Revenues 1,249,653 248,073 Operating Income (Loss) 180,040 (50,620) Margin % 14.4% (20.4)% Decorative Surfaces Operating Revenues 1,230,995 232,111 Operating Income 142,582 27,984 Margin % 11.6% 12.1% All Other Operating Revenues 3,226,927 661,804 Operating Income 588,325 73,440 Margin % 18.2% 11.1% Intercompany Revenue $(54,244) $(7,030) As Reported on Statement of Income Operating Revenues $17,100,341 $3,146,379 Operating Income 2,501,286 91,294 Margin % 14.6% 2.9%

SOURCE Illinois Tool Works Inc.

Source: PR Newswire

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