Investor Relations

Base Revenues Show Ongoing Stabilization; Return of Decorative Surfaces Segment to Continuing Operations Adds 4 Cents of Earnings to Revised Second Quarter 2009 Forecast of $0.29 to $0.41

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.

          (% change for 3 months ended May 31, 2009 versus prior year period)

             *Industrial Packaging:                      -  37.2%
             *Power Systems and Electronics:             -  37.1%
             *Transportation:                            -  22.9%
             *Food Equipment:                            -  15.0%
             *Construction Products:                     -  36.6%
             *Polymers and Fluids:                       -   7.9%
             *Decorative Surfaces                        -  24.0%
             *All Other:                                 -  18.3%

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.

    -0-                           06/15/2009
    /CONTACT:  John Brooklier of Illinois Tool Works Inc., +1-847-657-4104,
jbrooklier@itw.com/
    /Web Site:  http://www.itw.com /
    (ITW)

CO:  Illinois Tool Works Inc.

ST:  Illinois
IN:  AUT FIN CST
SU:  ERN ERP

PR
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4510 06/15/2009 08:00 EDT http://www.prnewswire.com