Illinois Tool Works Inc. · NYSE:ITW
Illinois Tool Works — Baird Conference 2013
14 slides from Illinois Tool Works's conference presentation, Nov 4, 2013
Slide 1: Welding Segment Overview
Welding Segment Overview November 4th, 2013 SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPERATOR.
Slide 2: Welding Segment Overview
Welding Segment Overview Design and market value added welding equipment, filler metals and accessories 2013 (F) Revenue: 1,840M OI: 483M (26.2%) Businesses in 25 countries Approximately 4,100 employees worldwide Revenue 2,000.0 1,000.0 - 1993 2003 2013 SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OP
Slide 3: Revenue Diversification
Revenue Diversification 2010 2013F Revenue CAGR 9.6 % $1,398M $1,840M Income CAGR 12.1 % $343M $483M % of Revenue 24.5% 26.2% Geography Product 21% 35% 50% 65% Equipment 29% Filler Metals Guns/Accessories/Other North America Rest of World SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPERATOR. 3
Slide 4: Organization
Organization Group President led Platforms Oil & Gas Industrial End Markets – Pipeline, Offshore Rig, Refineries End markets - Heavy Equipment, Automotive, Products – Welding Solutions, Orbital Shipyards, Railcar and Structural Welding/Cutting, Induction Heating and Insulation Products – Wel
Slide 5: Welding System
Welding System Equipment, filler metal, gun and accessories Developed Emerging Stick 13% 44% MIG – Solid 55% 32% MIG – Tubular 23% 12% Subarc 9% 11% SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPERATOR. 5
Slide 6: Global Welding Market Size
Global Welding Market Size Equipment Filler Metals Total ($ Billion) ($ Billion) ($ Billion) North America $1.7 $3.0 $4.7 EMEA $1.6 $3.5 $5.1 Asia $3.3 $5.8 $9.1 South America $0.6 $1.0 $1.6 Welding WW $7.2 $13.3 $20.5 6 SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPERATOR.
Slide 7: Competitive Landscape
Competitive Landscape Lincoln 14% Other 35% ESAB 10% ITW 8% Atlantic 1% Big Bridge Kemppi 1% 6% Hyundai 1% OTC 1% Golden Bridge Hypertherm Kobelco Fronius 4% 2% 2% Air Liquide 2% Victor Bohler Pansonic 3% 2% 3% 3% SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPERATOR. 7
Slide 8: Enterprise Strategy 2012-2017
Enterprise Strategy 2012-2017 ITW’s Differentiated Differentiated Performance Business Model Key Enterprise Initiatives 80/20 Business Solid Growth Process • Portfolio Management • Business Structure Customer- Simplification Strong Focused Innovation Returns • Strategic Sourcing Decentralized Best-i
Slide 9: Strategic Framework
Strategic Framework ●Where do we focus? – Sizeable end markets – Favorable growth profile – High integrity welds ●How do we win? – Intimate knowledge of customer pain points – Create value added solutions that make difference in the customer’s business SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPE
Slide 10: Customer-Focused Innovation: Oil & Gas Platform
ITW’s Differentiated Business Model Customer-Focused Innovation Platform: Oil & Gas Customer/End Market: Process pipe installers/Petrochem - Refinery ● Key customer pain points: – Extremely demanding welding field environment – Downtime cost a major issue for customers – Fewer skilled welders ● ITW
Slide 11: Customer-Focused Innovation: Industrial Automotive Platform
ITW’s Differentiated Business Model Customer-Focused Innovation Platform: Industrial Customers/End Market: Tier-1 Frame Manufacturers/Automotive Customer Pain Points ● Light weight vehicles increasing use of galvanized steel ● Difficult to produce high integrity welds without compromising productivi
Slide 12: Customer-Focused Innovation: Construction Machinery Platform
ITW’s Differentiated Business Model Customer-Focused Innovation Platform: Industrial Customers/End Market : Construction Machinery/Heavy Equipment Customer Pain Points ● Increased environmental regulation ITW solution: Miller Capture 5 & Hobart Element – System solution that reduces fume generation
Slide 13: Customer-Focused Innovation: Commercial Platform
ITW’s Differentiated Business Model Customer-Focused Innovation Platform: Commercial Customers/End Market: Small-Medium commercial contractors /Construction Customer Pain Points ● Increased environmental regulation ● Desire portability ● Fuel Efficiency ITW solution: New TrailBlazer & Bobcat – Key F
Slide 14: Welding Segment Overview
Welding Segment Overview November 4th, 2013 SOLID GROWTH. STRONG RETURNS. BEST-IN-CLASS OPERATOR.