Illinois Tool Works Inc.

ITW

US4523081093

Consumer Goods Conglomerates

Market Closed - Nyse Other stock markets 04:00:02 2025-01-24 pm EST			5-day change	1st Jan Change
259.90 ^USD	0.00%		+1.37%	+2.50%

Jan. 24	Stifel Adjusts Price Target on Illinois Tool Works to $266 From $268, Keeps Hold Rating	MT
Jan. 16	Goldman Sachs Adjusts Illinois Tool Works Price Target to $257 From $260, Maintains Neutral Rating	MT

Illinois Tool Works : Q3 2024 Earnings Webcast Presentation

October 30, 2024 at 11:24 am EDT

Third Quarter 2024 Earnings Conference Call

October 30, 2024

Q3'24 Financial Performance

GAAP EPS	$2.55	$3.91	+53%
- Ex. divestiture gain		$2.65	+4%

$4.0B

(2)%

(1)%

Organic

Revenue

	Q3'23	Q3'24
Operating Margin	26.5%	26.5%	Flat

Segment Operating Margin*	26.0%	27.1%	+110 bps

COMMENTARY

Demand continued to moderate across our portfolio
- Q3 revs. were approx. 0.5%-pt / $25M lower than they would have been had demand held at levels exiting Q2
Strong execution on all the elements within our control
- Enterprise initiatives contributed +130 bps
EPS of $2.65 ex. divestiture gain of $1.26
Free cash flow* of $783M, 102% of adjusted net income
Announced dividend increase of +7%
- 61 years of consecutive dividend increases

CONTINUED STRONG OPERATIONAL EXECUTION IN MODERATING DEMAND ENVIRONMENT

*Segment operating margin excludes the impact of Unallocated. See ITW's Q3'24 press release

3 for the reconciliation from GAAP to non-GAAP measures.

Never stronger. Never better positioned for the future.

Q3'24 Segment Performance

Q3'24 YTD OPERATING MARGIN PERFORMANCE

AUTOMOTIVE OEM

	Op. Margin	VPY
Automotive OEM	19.5%	+220 bps

Food Equipment	27.2%	Flat

T&M / Electronics	24.2%	+40 bps

Welding	32.6%	+10 bps

Polymers & Fluids	27.3%	+110 bps

Construction Products	29.6%	+70 bps
Specialty Products	30.9%	+450 bps

$799M	(3)%
$772M
Q3'23	Q3'24
Revenue

18.9%	19.4%	+50 bps

Q3'23	Q3'24

Operating Margin

Total Company	27.0%	+180 bps

Strong operational execution drives continued margin expansion in a challenging demand environment
Enterprise initiatives contribute 130 bps year-to-date

Organic revenue (3)%
North America (6)%
Europe (5)%
China (2)%

4	Never stronger. Never better positioned for the future.

Q3'24 Segment Performance

FOOD EQUIPMENT

TEST & MEASUREMENT/ELECTRONICS

$678M $677M

Q3'23 Q3'24

Revenue

Flat	28.4%	+110 bps
27.3%
Q3'23	Q3'24

Operating Margin

$698M $697M

Q3'23 Q3'24

Revenue

Flat	25.7%	+190 bps
23.8%
Q3'23	Q3'24

Operating Margin

Organic revenue flat
Equipment (4)%, Service 7%
North America (2)%
International 3%

Organic revenue (1)%
Test & Measurement (3)%
Electronics 1%

5	Never stronger. Never better positioned for the future.

Q3'24 Segment Performance

WELDING
32.3%	+70 bps

POLYMERS & FLUIDS

$468M		$462M (1)%	31.6%


Q3'23		Q3'24	Q3'23	Q3'24
Revenue	Operating Margin

$458M	$448M	(2)%
Q3'23	Q3'24
Revenue

28.1%	27.9%	(20) bps

Q3'23	Q3'24

Operating Margin

Organic revenue (1)%
Equipment (1)%, Consumables (1)%
North America (2)%
International 6%

Organic revenue 1%
Polymers 10%
Fluids 3%
Automotive Aftermarket (3)%

6	Never stronger. Never better positioned for the future.

Q3'24 Segment Performance

CONSTRUCTION PRODUCTS

SPECIALTY PRODUCTS

$522M	(8)%
	$479M
Q3'23	Q3'24
Revenue

+30 bps

29.9%	30.2%
Q3'23	Q3'24

Operating Margin

	$438M	+6%
$414M

Q3'23	Q3'24
Revenue

+330 bps

	31.1%
27.8%
Q3'23	Q3'24

Operating Margin

Organic revenue (9)%
North America (10)%
Europe (4)%
Australia/New Zealand (11)%

Organic revenue 6%
North America 8%
International 2%

7	Never stronger. Never better positioned for the future.

2024 Financial Guidance

GAAP EPS	$9.74	$11.63	- $11.73	+20%
- Ex. divestiture gain		$10.37	- $10.47	+7%	•

$16.1B	$16.0 - $16.2B
	~flat	•
	Organic
Revenue

	2023	2024E		•

Operating Margin	25.1%	26.5 - 27%	+165 bps
				•
After-tax ROIC*	30.4%	31%+

COMMENTARY

Raised 2024 GAAP EPS guidance by $1.33 at the mid-pt.

Adjusted for divestiture gain of $1.26 & projected 2024 tax rate of approx. 21.5%

2024 operational guidance remains unchanged

Revenue and organic growth projected to be approx. flat based on current levels of demand and FX rates
Operating margin of 26.5 to 27% improves +165 bps as enterprise initiatives contribute more than 100 bps

Free cash flow conversion ~100% of adjusted net income

Share repurchases of ~$1.5B

FOCUSED ON MANAGING & INVESTING TO MAXIMIZE GROWTH & PERFORMANCE OVER THE LONG TERM

8 *See ITW's Q3'24 press release for the reconciliation from GAAP to non-GAAP measures.

Never stronger. Never better positioned for the future.

Q&A

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Illinois Tool Works Inc. published this content on October 30, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on October 30, 2024 at 15:23:11.365.

Latest news about Illinois Tool Works Inc.

Stifel Adjusts Price Target on Illinois Tool Works to $266 From $268, Keeps Hold Rating	Jan. 24	MT
Goldman Sachs Adjusts Illinois Tool Works Price Target to $257 From $260, Maintains Neutral Rating	Jan. 16	MT
Wolfe Research Adjusts Price Target on Illinois Tool Works to $272 From $266	Jan. 13	MT
Citigroup Adjusts Price Target on Illinois Tool Works to $265 From $279	Jan. 13	MT
Barclays Adjusts Price Target on Illinois Tool Works to $265 From $270, Maintains Equalweight Rating	Jan. 08	MT
Truist Securities Raises Price Target on Illinois Tool Works to $318 From $312, Keeps Buy Rating	Dec. 19	MT
Goldman Sachs Adjusts Illinois Tool Works Price Target to $260 From $252, Maintains Neutral Rating	Dec. 12	MT
Stifel Adjusts Price Target on Illinois Tool Works to $268 From $262, Keeps Hold Rating	Dec. 11	MT
Citigroup Adjusts Illinois Tool Works Price Target to $279 From $266, Maintains Neutral Rating	Dec. 09	MT
Jefferies Adjusts Illinois Tool Works Price Target to $290 From $255, Maintains Hold Rating	Dec. 06	MT
Barclays Upgrades Illinois Tool Works to Equalweight From Underweight, Adjusts Price Target to $270 From $230	Dec. 05	MT
Deutsche Bank Raises Price Target on Illinois Tool Works to $225 From $218, Keeps Sell Rating	Nov. 26	MT
Wells Fargo Raises Illinois Tool Works Price Target to $260 From $255, Maintains Underweight Rating	Nov. 18	MT
Analyst recommendations: Spotify, Starbucks, Tesla, Block, Coinbase...	Nov. 13
Evercore ISI Downgrades Illinois Tool Works to Underperform From In Line, Adjusts Price Target to $255 From $246	Nov. 13	MT
Trump makes Wall Street shine and depresses Europe	Nov. 11
Vertical Research Raises Price Target on Illinois Tool Works to $275 From $265	Nov. 11	MT
Analyst recommendations: Moderna, Bristol-Myers Squibb Company, Regeneron Pharmaceuticals, Arista Networks...	Nov. 11
Barclays Adjusts Price Target on Illinois Tool Works to $230 From $215	Nov. 01	MT
JPMorgan Adjusts Illinois Tool Works' Price Target to $300 From $295	24-10-31	MT
Deutsche Bank Adjusts Illinois Tool Works' Price Target to $218 From $211	24-10-31	MT
Goldman Sachs Adjusts Illinois Tool Works' Price Target to $252 From $235	24-10-31	MT
Wells Fargo Adjusts Illinois Tool Works' Price Target to $255 From $250	24-10-31	MT
Baird Adjusts Illinois Tool Works' Price Target to $250 From $240	24-10-31	MT
Jefferies Adjusts Illinois Tool Works' Price Target to $255 From $245	24-10-31	MT

Chart Illinois Tool Works Inc.

Duration

Period

ITW: Dynamic Chart

Company Profile

Illinois Tool Works Inc. is a diversified industrial group organized around 7 families of products: - automotive equipment (20.1% of net sales). Besides, the group proposes products for maintenance and refurbishment (coatings, sealants, shutters, etc.); - electronic equipment (17.5%): primarily equipment of microelectronic assembly. The group also provides test and measurement equipment and software; - equipment for industrial kitchens (16.3%): cookers, dishwasher, ovens, refrigerators, cupboards, systems of aeration, etc.; - construction systems and materials (12.6%): powder and gas nailing, perforators and consumables (fuses, chisels, pads, plugs, etc.) intended for applications on wood, steel and concrete; - polymers, coatings, resins, adhesives and lubricants (11.2%); - metallurgical equipment (10.5%): arc welding equipment, blowtorches, welding accessories, etc. - specialty products (11.3%): industrial packaging systems and materials, products coding and marking equipment, etc. Net sales are distributed geographically as follows: the United States (47.1%), North America (6.9%), Europe/Middle East/Africa (25.8%), Asia/Pacific (18.3%) and South America (1.9%).

Employees

45,000

Sector

Consumer Goods Conglomerates

Calendar

2025-02-05 - Q4 2024 Earnings Release

More about the company