ITT Inc. · NYSE:ITT
ITT — Q1 2008 Earnings Presentation
13 slides from ITT's earnings presentation, Apr 25, 2008
Slide 1: First Quarter 2008 Investor Review
First Quarter 2008 Investor Review April 25, 2008
Slide 2: Q1 Highlights
Q1 Highlights Solid Organic Revenue Growth • Total Growth Across All Segments • Strong International Growth Commercial Margin Expansion • Operational Initiatives 25% EPS Growth Raising Full-Year Guidance by $0.18 Record Free Cash Flow Generation Focused Strategic Investments 1
Slide 3: ITT Business Results
ITT Business Results 1Q 07 1Q 08 $2,806 +9% Organic Growth Revenues • Defense +13% $2,070 +36% • International sales drive Fluid +6% and Motion and Flow +7% Segment $323 Acquisitions Over-delivering Operating $249 Segment Operating Margin Down 50 bps Income +30% • Favorable productivity and pe
Slide 4: Fluid Technology
Fluid Technology 1Q 07 1Q 08 Fluid Technology Revenue +6% Organic Revenue on Strong International $881 +3% Organic Orders $786 +50 bps Operating Margin • Volume & productivity partially offset by FX +12% • Benefits from global footprint realignment Organic Revenue Operating +16% Industrial P
Slide 5: Motion & Flow Control
Motion & Flow Control 1Q 07 1Q 08 Motion & Flow Control Revenue +7% Organic Revenue Led By Friction and Aerospace $421 +5% Organic Orders $318 +20 bps Operating Margin • Volume, productivity & FX; offset by IMC +32% • Benefits from footprint realignment actions Organic Revenue Operating +15%
Slide 6: Defense Electronics & Services
Defense Electronics & Services 1Q 07 4Q 07 1Q 08 Defense Electronics & Services Backlog $5,234 +13% Organic Revenue Driven By Balanced $5,026 Performance $3,715 +24% Organic Orders • $175M Night Vision order • +48% Advanced Engineering and Sciences 1Q 07 1Q 08 Revenue -130 bps Operating Margin
Slide 7: 2008 Earnings Outlook
2008 Earnings Outlook ($ in Millions except EPS) Second Quarter 2008 Consolidated Guidance 2007 Q208 yr/yr Growth 1 Revenue ## $ 2,900 - $ 2,980 32% Segment OI Margin ### 12.9% - 13.1% -20 bps Earnings Per Share ## $ 1.07 - $ 1.13 28% Full Year 2008 Guidance 2007 2008 yr/yr Growth 1 Segment Guidance
Slide 8: Defense Electronics & Services: Strategic Developments & Recent Awards
Defense Electronics & Services Strategic Developments & Recent Awards Communications Systems • Strong International Pipeline (~$4B) • Iraq – Delivered radios • Bulgaria – Actively pursuing opportunity • Active Negotiations with JTRS Team Night Vision • $175 Million Award - Demand Remains High •
Slide 9: Appendix
Y tT Engineered for life Appendix
Slide 10: ITT Q1 2008 Margin Performance
ITT Q1 2008 Margin Performance Fluid Technology Motion & Flow Control Defense Q1 07 11.1% Q1 07 16.0% Q1 07 11.4% Operational/Other 0.9% Operational/Other 0.3% Operational/Other (0.1%) Pension 0.4% Pension 0.2% Pension 0.5% FX (0.8%) FX 0.1% EDO Acquisition (1.7%) Q1 08 11.6% IMC Acquisition (0.4%)
Slide 11: Non-GAAP Reconciliations - EPS
Non-GAAP Reconciliations - EPS 1Q07 1Q08 Adjusted EPS from Continuing Ops. $ 0.73 $ 0.91 Tax Settlement/Other $ 0.01 $ 0.02 EPS from Continuing Ops. $ 0.74 $ 0.93 Discontinued Ops. $ 0.02 $ 0.01 Reported EPS $ 0.76 $ 0.94 10
Slide 12: 2008 Guidance Roll-Forward
2008 Guidance Roll-Forward Original Full Year 2008 Guidance $ 3.80 $ 3.95 Interest ~ $ 0.09 Base Business Performance ~ $ 0.06 EDO Performance ~ $ 0.02 Pension & Corporate ~ $ 0.01 Total Change vs mid-point ~ $ 0.18 Revised FY 2008 Guidance $ 4.00 $ 4.10 11
Slide 13: Safe Harbor
Safe Harbor •“Safe Harbor Statement” under the Private Securities Litigation Reform Act of 1995 (“the Act”): •Certain material presented herein includes forward-looking statements intended to qualify for the safe harbor from liability established by the Act. These forward-looking statements include