Illinois Tool Works Inc. · NYSE:ITW
Illinois Tool Works — Q1 2015 Earnings Presentation
13 slides from Illinois Tool Works's earnings presentation, Apr 21, 2015
Slide 1: First Quarter 2015 Conference Call
First Quarter 2015 Conference Call E. Scott Santi, President & CEO Michael M. Larsen, Senior Vice President & CFO Aaron H. Hoffman, Vice President, Investor Relations April 21, 2015
Slide 2: Forward Looking Statements
Forward Looking Statements Safe Harbor Statement This conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, without limitation, statements regarding the expected impact and timing of strategic initiatives and related
Slide 3: First Quarter 2015 Highlights
First Quarter 2015 Highlights ● Solid execution and performance despite currency headwinds and a challenging capital spending environment – Record first quarter operating margin of 20.9%, an increase of 220 basis points – 20% EPS growth to $1.21 … $0.04 above midpoint of guidance despite $0.03 of in
Slide 4: Q1 2015 Financial Summary
Q1 2015 Financial Summary Q1 2015 Actuals Highlights EPS +20% ● $1.21 EPS up 20% vs. prior year … $0.04 above mid-point $1.21 of guidance EPS $1.01 Guidance: ● Record Q1 operating margin of 20.9%; Enterprise Initiatives $1.13 - $1.21 $3.6B $3.3B contributed 100 basis points ● Organic revenue up 1% …
Slide 5: Organic Revenue Growth
Q1 2015 Organic Revenue Growth Growth by Geography Highlights ● North America up 1% Organic revenue – Food Equipment +7%, Automotive OEM +3% up 1%* – Welding and Test & Measurement and Electronics flat, Specialty (7)% ● International up 1% 1% 1% 1% 1% – Europe up 1% (11)% • Automotive OEM +13% offse
Slide 6: Operating Margin
Q1 2015 Operating Margin Operating Margin Key Drivers 20.9% 18.7% Q1 2015 Enterprise Initiatives +100 bps Q1‘14 Q1‘15 OM% V bps Price/Cost +20 Automotive OEM 25.0% +170 Volume +20 T&M and Electronics 14.7 +250 Food Equipment 22.6 +400 Other (cost management and PLS benefits) +80 Polymers & Fluids 20
Slide 7: Segment Results
Q1 2015 Segment Results ($’s in millions) Two years of significant margin improvement Automotive OEM Organic +7% Operating Margin Total (2)% +170 bps Q1’13 Q1‘15 V bps 25.0% $668 $653 23.3% Automotive OEM 19.8% 25.0% +520 T&M and Electronics 13.0 14.7 +170 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Food Equipment 16.7
Slide 8: Segment Results
Q1 2015 Segment Results ($’s in millions) Test & Measurement and Electronics Food Equipment Organic (1)% Organic +4% +250 bps +400 bps Total (7)% Total (3)% 14.7% 22.6% $519 $483 $511 12.2% $495 18.6% Q1‘14 Q1‘15 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Total Revenue Operating Margin Total Revenue Operat
Slide 9: Segment Results
Q1 2015 Segment Results ($’s in millions) Polymers & Fluids Welding Organic (1)% Organic (3)% +340 bps +120 bps Total (8)% Total (7)% 20.0% 26.9% $479 $463 25.7% $441 16.6% $433 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Total Revenue Operating Margin Total Revenue Operating Margin Highlights H
Slide 10: Segment Results
Q1 2015 Segment Results ($’s in millions) Construction Products Specialty Products Organic +2% Organic (6)% +180 bps +150 bps Total (8)% Total (11)% 16.6% $520 22.6% $416 $462 21.1% $381 14.8% Q1‘14 Q1’15 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Q1‘14 Q1‘15 Total Revenue Operating Margin Total Revenue Operating Marg
Slide 11: 2015 Financial Guidance
2015 Financial Guidance 2015 Q2 2015 $5.00 - $5.20 $1.22 - $1.30 EPS $4.67 EPS $1.21 Organic +1 - 2% Organic +1 - 2% $14.5B Total (5) to (6)% $3.7B Total (7) to (8)% Total Total Revenue Revenue 2014 2015F Q2’14 Q2’15F ● Reducing EPS guidance by $(0.15) to reflect current exchange rates ● Expect 1 -
Slide 12: Questions
Questions
Slide 13: Appendix - Additional Segment Detail
Appendix - Additional Segment Detail Q1 2015 vs. Q1 2014 Favorable / (Unfavorable) Automotive T&M and Food Polymers & Construction Specialty Total Revenue OEM Electronics Equipment Fluids Welding Products Products Organic 6.7% (0.9)% 4.0% (0.5)% (3.3)% 2.4% (5.7)% Divestitures (0.4) - - - (0.1) (1.5