[X]
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|
|
SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
For the quarterly period ended June 30, 2014
|
|
|
|
OR
|
|
|
[ ]
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|
|
SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
For the transition period from _______________ to _______________
|
Delaware
|
36-1258310
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification Number)
|
|
|
3600 West Lake Avenue, Glenview, IL
|
60026-1215
|
(Address of principal executive offices)
|
(Zip Code)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions except per share amounts)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating Revenues
|
$
|
3,719
|
|
|
$
|
3,593
|
|
|
$
|
7,288
|
|
|
$
|
7,013
|
|
Cost of revenues
|
2,219
|
|
|
2,155
|
|
|
4,377
|
|
|
4,233
|
|
||||
Selling, administrative, and research and development expenses
|
677
|
|
|
747
|
|
|
1,359
|
|
|
1,450
|
|
||||
Amortization of intangible assets
|
60
|
|
|
61
|
|
|
122
|
|
|
122
|
|
||||
Operating Income
|
763
|
|
|
630
|
|
|
1,430
|
|
|
1,208
|
|
||||
Interest expense
|
(64
|
)
|
|
(59
|
)
|
|
(128
|
)
|
|
(119
|
)
|
||||
Other income (expense)
|
7
|
|
|
10
|
|
|
16
|
|
|
57
|
|
||||
Income from Continuing Operations Before Income Taxes
|
706
|
|
|
581
|
|
|
1,318
|
|
|
1,146
|
|
||||
Income Taxes
|
212
|
|
|
165
|
|
|
396
|
|
|
329
|
|
||||
Income from Continuing Operations
|
494
|
|
|
416
|
|
|
922
|
|
|
817
|
|
||||
Income from Discontinued Operations
|
998
|
|
|
49
|
|
|
1,043
|
|
|
2
|
|
||||
Net Income
|
$
|
1,492
|
|
|
$
|
465
|
|
|
$
|
1,965
|
|
|
$
|
819
|
|
|
|
|
|
|
|
|
|
||||||||
Income Per Share from Continuing Operations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.22
|
|
|
$
|
0.93
|
|
|
$
|
2.23
|
|
|
$
|
1.81
|
|
Diluted
|
$
|
1.21
|
|
|
$
|
0.92
|
|
|
$
|
2.22
|
|
|
$
|
1.80
|
|
Income Per Share from Discontinued Operations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
2.47
|
|
|
$
|
0.11
|
|
|
$
|
2.52
|
|
|
$
|
—
|
|
Diluted
|
$
|
2.45
|
|
|
$
|
0.11
|
|
|
$
|
2.50
|
|
|
$
|
—
|
|
Net Income Per Share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
3.69
|
|
|
$
|
1.04
|
|
|
$
|
4.76
|
|
|
$
|
1.82
|
|
Diluted
|
$
|
3.66
|
|
|
$
|
1.03
|
|
|
$
|
4.72
|
|
|
$
|
1.81
|
|
Cash Dividends Per Share:
|
|
|
|
|
|
|
|
||||||||
Paid
|
$
|
0.42
|
|
|
$
|
0.38
|
|
|
$
|
0.84
|
|
|
$
|
0.38
|
|
Declared
|
$
|
0.42
|
|
|
$
|
0.38
|
|
|
$
|
0.84
|
|
|
$
|
0.76
|
|
|
|
|
|
|
|
|
|
||||||||
Shares of Common Stock Outstanding During the Period:
|
|
|
|
|
|
|
|
||||||||
Average
|
404.7
|
|
|
449.6
|
|
|
413.3
|
|
|
450.7
|
|
||||
Average assuming dilution
|
407.6
|
|
|
452.5
|
|
|
416.3
|
|
|
453.7
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net Income
|
$
|
1,492
|
|
|
$
|
465
|
|
|
$
|
1,965
|
|
|
$
|
819
|
|
Other Comprehensive Income:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
(50
|
)
|
|
(251
|
)
|
|
(22
|
)
|
|
(401
|
)
|
||||
Pension and other postretirement benefit adjustments, net of tax
|
(11
|
)
|
|
108
|
|
|
(3
|
)
|
|
120
|
|
||||
Comprehensive Income
|
$
|
1,431
|
|
|
$
|
322
|
|
|
$
|
1,940
|
|
|
$
|
538
|
|
(In millions)
|
June 30, 2014
|
|
December 31, 2013
|
||||
Assets
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and equivalents
|
$
|
5,297
|
|
|
$
|
3,618
|
|
Trade receivables
|
2,598
|
|
|
2,365
|
|
||
Inventories
|
1,305
|
|
|
1,247
|
|
||
Deferred income taxes
|
307
|
|
|
384
|
|
||
Prepaid expenses and other current assets
|
284
|
|
|
366
|
|
||
Assets held for sale
|
—
|
|
|
1,836
|
|
||
Total current assets
|
9,791
|
|
|
9,816
|
|
||
|
|
|
|
||||
Net plant and equipment
|
1,700
|
|
|
1,709
|
|
||
Goodwill
|
4,904
|
|
|
4,886
|
|
||
Intangible assets
|
1,876
|
|
|
1,999
|
|
||
Deferred income taxes
|
368
|
|
|
359
|
|
||
Other assets
|
1,297
|
|
|
1,197
|
|
||
|
$
|
19,936
|
|
|
$
|
19,966
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
|
|
||
Current Liabilities:
|
|
|
|
|
|
||
Short-term debt
|
$
|
1,070
|
|
|
$
|
3,551
|
|
Accounts payable
|
683
|
|
|
634
|
|
||
Accrued expenses
|
1,278
|
|
|
1,272
|
|
||
Cash dividends payable
|
167
|
|
|
181
|
|
||
Income taxes payable
|
715
|
|
|
69
|
|
||
Deferred income taxes
|
10
|
|
|
10
|
|
||
Liabilities held for sale
|
—
|
|
|
317
|
|
||
Total current liabilities
|
3,923
|
|
|
6,034
|
|
||
|
|
|
|
||||
Noncurrent Liabilities:
|
|
|
|
|
|
||
Long-term debt
|
6,140
|
|
|
2,793
|
|
||
Deferred income taxes
|
515
|
|
|
507
|
|
||
Other liabilities
|
918
|
|
|
923
|
|
||
Total noncurrent liabilities
|
7,573
|
|
|
4,223
|
|
||
|
|
|
|
||||
Stockholders’ Equity:
|
|
|
|
|
|
||
Common stock
|
6
|
|
|
6
|
|
||
Additional paid-in-capital
|
1,064
|
|
|
1,046
|
|
||
Income reinvested in the business
|
16,568
|
|
|
14,943
|
|
||
Common stock held in treasury
|
(9,562
|
)
|
|
(6,676
|
)
|
||
Accumulated other comprehensive income
|
359
|
|
|
384
|
|
||
Noncontrolling interest
|
5
|
|
|
6
|
|
||
Total stockholders’ equity
|
8,440
|
|
|
9,709
|
|
||
|
$
|
19,936
|
|
|
$
|
19,966
|
|
|
Six Months Ended
|
||||||
(In millions)
|
June 30,
|
||||||
|
2014
|
|
2013
|
||||
Cash Provided by (Used for) Operating Activities:
|
|
|
|
||||
Net income
|
$
|
1,965
|
|
|
$
|
819
|
|
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation
|
137
|
|
|
154
|
|
||
Amortization and impairment of goodwill and other intangible assets
|
122
|
|
|
178
|
|
||
Change in deferred income taxes
|
51
|
|
|
49
|
|
||
Provision for uncollectible accounts
|
5
|
|
|
5
|
|
||
(Income) loss from investments
|
(6
|
)
|
|
(5
|
)
|
||
(Gain) loss on sale of plant and equipment
|
—
|
|
|
(1
|
)
|
||
(Gain) loss on discontinued operations
|
(1,709
|
)
|
|
76
|
|
||
(Gain) loss on sale of operations and affiliates
|
5
|
|
|
6
|
|
||
Stock-based compensation expense
|
21
|
|
|
18
|
|
||
Gain on acquisition of controlling interest in an equity investment
|
—
|
|
|
(30
|
)
|
||
Other non-cash items, net
|
4
|
|
|
4
|
|
||
Change in assets and liabilities:
|
|
|
|
|
|
||
(Increase) decrease in-
|
|
|
|
|
|
||
Trade receivables
|
(232
|
)
|
|
(315
|
)
|
||
Inventories
|
(55
|
)
|
|
(33
|
)
|
||
Prepaid expenses and other assets
|
(71
|
)
|
|
5
|
|
||
Increase (decrease) in-
|
|
|
|
|
|
||
Accounts payable
|
(22
|
)
|
|
75
|
|
||
Accrued expenses and other liabilities
|
(1
|
)
|
|
30
|
|
||
Income taxes
|
746
|
|
|
(7
|
)
|
||
Other, net
|
(73
|
)
|
|
(19
|
)
|
||
Net cash provided by operating activities
|
887
|
|
|
1,009
|
|
||
Cash Provided by (Used for) Investing Activities:
|
|
|
|
|
|
||
Acquisition of businesses (excluding cash and equivalents) and additional interest in affiliates
|
(6
|
)
|
|
(77
|
)
|
||
Additions to plant and equipment
|
(146
|
)
|
|
(178
|
)
|
||
Proceeds from investments
|
11
|
|
|
14
|
|
||
Proceeds from sale of plant and equipment
|
15
|
|
|
11
|
|
||
Net proceeds from sale of discontinued operations
|
3,177
|
|
|
59
|
|
||
Proceeds from sales of operations and affiliates
|
9
|
|
|
1
|
|
||
Other, net
|
14
|
|
|
(6
|
)
|
||
Net cash provided by (used for) investing activities
|
3,074
|
|
|
(176
|
)
|
||
Cash Provided by (Used for) Financing Activities:
|
|
|
|
|
|
||
Cash dividends paid
|
(355
|
)
|
|
(171
|
)
|
||
Issuance of common stock
|
81
|
|
|
128
|
|
||
Repurchases of common stock
|
(2,905
|
)
|
|
(677
|
)
|
||
Net proceeds from (repayments of) debt with original maturities of three months or less
|
(1,680
|
)
|
|
42
|
|
||
Proceeds from debt with original maturities of more than three months
|
3,329
|
|
|
1
|
|
||
Repayments of debt with original maturities of more than three months
|
(801
|
)
|
|
(1
|
)
|
||
Other, net
|
7
|
|
|
14
|
|
||
Net cash provided by (used for) financing activities
|
(2,324
|
)
|
|
(664
|
)
|
||
Effect of Exchange Rate Changes on Cash and Equivalents
|
42
|
|
|
(180
|
)
|
||
Cash and Equivalents:
|
|
|
|
|
|
||
Increase (decrease) during the period
|
1,679
|
|
|
(11
|
)
|
||
Beginning of period
|
3,618
|
|
|
2,779
|
|
||
End of period
|
$
|
5,297
|
|
|
$
|
2,768
|
|
Supplementary Cash and Non-Cash Information:
|
|
|
|
||||
Cash Paid During the Period for Interest
|
$
|
93
|
|
|
$
|
95
|
|
Cash Paid During the Period for Income Taxes, Net of Refunds
|
$
|
343
|
|
|
$
|
232
|
|
Liabilities Assumed from Acquisitions
|
$
|
4
|
|
|
$
|
72
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
212
|
|
|
$
|
759
|
|
|
$
|
798
|
|
|
$
|
1,496
|
|
|
|
|
|
|
|
|
|
||||||||
Income before income taxes
|
$
|
1,724
|
|
|
$
|
69
|
|
|
$
|
1,796
|
|
|
$
|
50
|
|
Income tax expense
|
(726
|
)
|
|
(20
|
)
|
|
(753
|
)
|
|
(48
|
)
|
||||
Income from discontinued operations
|
$
|
998
|
|
|
$
|
49
|
|
|
$
|
1,043
|
|
|
$
|
2
|
|
(In millions)
|
December 31, 2013
|
||
Trade receivables
|
$
|
352
|
|
Inventories
|
244
|
|
|
Net plant and equipment
|
305
|
|
|
Goodwill and intangible assets
|
844
|
|
|
Other
|
91
|
|
|
Total assets held for sale
|
$
|
1,836
|
|
|
|
||
Accounts payable
|
$
|
87
|
|
Accrued expenses
|
139
|
|
|
Other
|
91
|
|
|
Total liabilities held for sale
|
$
|
317
|
|
(In millions)
|
June 30, 2014
|
|
December 31, 2013
|
||||
Raw material
|
$
|
456
|
|
|
$
|
445
|
|
Work-in-process
|
153
|
|
|
145
|
|
||
Finished goods
|
696
|
|
|
657
|
|
||
Total inventories
|
$
|
1,305
|
|
|
$
|
1,247
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||||||||||||||||||
|
Pension
|
|
Other Postretirement Benefits
|
|
Pension
|
|
Other Postretirement Benefits
|
||||||||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||||||
Components of net periodic benefit cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Service cost
|
$
|
20
|
|
|
$
|
23
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
40
|
|
|
$
|
46
|
|
|
$
|
5
|
|
|
$
|
6
|
|
Interest cost
|
26
|
|
|
24
|
|
|
6
|
|
|
6
|
|
|
52
|
|
|
48
|
|
|
12
|
|
|
12
|
|
||||||||
Expected return on plan assets
|
(39
|
)
|
|
(39
|
)
|
|
(6
|
)
|
|
(6
|
)
|
|
(79
|
)
|
|
(78
|
)
|
|
(12
|
)
|
|
(11
|
)
|
||||||||
Amortization of actuarial (gain)/loss
|
12
|
|
|
19
|
|
|
(1
|
)
|
|
—
|
|
|
24
|
|
|
38
|
|
|
(3
|
)
|
|
—
|
|
||||||||
Amortization of prior service cost
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||
Settlement loss/curtailment (gain)
|
2
|
|
|
34
|
|
|
(9
|
)
|
|
—
|
|
|
2
|
|
|
34
|
|
|
(9
|
)
|
|
—
|
|
||||||||
Net periodic benefit (income)/cost
|
$
|
21
|
|
|
$
|
61
|
|
|
$
|
(8
|
)
|
|
$
|
4
|
|
|
$
|
39
|
|
|
$
|
88
|
|
|
$
|
(7
|
)
|
|
$
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Amounts were included in the statement of income as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Continuing operations
|
$
|
18
|
|
|
$
|
59
|
|
|
$
|
1
|
|
|
$
|
4
|
|
|
$
|
34
|
|
|
$
|
83
|
|
|
$
|
2
|
|
|
$
|
8
|
|
Discontinued operations
|
3
|
|
|
2
|
|
|
(9
|
)
|
|
—
|
|
|
5
|
|
|
5
|
|
|
(9
|
)
|
|
—
|
|
||||||||
Net periodic benefit (income)/cost
|
$
|
21
|
|
|
$
|
61
|
|
|
$
|
(8
|
)
|
|
$
|
4
|
|
|
$
|
39
|
|
|
$
|
88
|
|
|
$
|
(7
|
)
|
|
$
|
8
|
|
(In millions)
|
June 30, 2014
|
|
December 31, 2013
|
||||
Fair value
|
$
|
7,425
|
|
|
$
|
4,670
|
|
Carrying value
|
7,170
|
|
|
4,627
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Beginning balance
|
$
|
420
|
|
|
$
|
155
|
|
|
$
|
384
|
|
|
$
|
293
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments during the period
|
82
|
|
|
(253
|
)
|
|
110
|
|
|
(407
|
)
|
||||
Foreign currency translation adjustments reclassified to income
|
(132
|
)
|
|
2
|
|
|
(132
|
)
|
|
6
|
|
||||
Total foreign currency translation adjustments
|
(50
|
)
|
|
(251
|
)
|
|
(22
|
)
|
|
(401
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Pension and other postretirement benefit adjustments during the period
|
(41
|
)
|
|
111
|
|
|
(41
|
)
|
|
111
|
|
||||
Pension and other postretirement benefit adjustments reclassified to income
|
19
|
|
|
58
|
|
|
29
|
|
|
77
|
|
||||
Income taxes
|
11
|
|
|
(61
|
)
|
|
9
|
|
|
(68
|
)
|
||||
Total pension and other postretirement benefit adjustments
|
(11
|
)
|
|
108
|
|
|
(3
|
)
|
|
120
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Ending balance
|
$
|
359
|
|
|
$
|
12
|
|
|
$
|
359
|
|
|
$
|
12
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
3,719
|
|
|
$
|
3,593
|
|
|
$
|
7,288
|
|
|
$
|
7,013
|
|
Operating income
|
763
|
|
|
630
|
|
|
1,430
|
|
|
1,208
|
|
||||
Operating margin %
|
20.5
|
%
|
|
17.5
|
%
|
|
19.6
|
%
|
|
17.2
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
1.4
|
%
|
|
3.4
|
%
|
|
0.4
|
%
|
|
2.3
|
%
|
|
5.9
|
%
|
|
0.6
|
%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
13.7
|
%
|
|
2.3
|
%
|
|
—
|
%
|
|
10.2
|
%
|
|
1.7
|
%
|
|
1.4
|
%
|
|
17.1
|
%
|
|
2.7
|
%
|
|
2.3
|
%
|
|
16.1
|
%
|
|
2.3
|
%
|
Acquisitions and divestitures
|
1.2
|
%
|
|
0.7
|
%
|
|
(0.1
|
)%
|
|
1.3
|
%
|
|
0.6
|
%
|
|
(0.2
|
)%
|
Restructuring costs
|
—
|
%
|
|
2.3
|
%
|
|
0.4
|
%
|
|
—
|
%
|
|
1.4
|
%
|
|
0.2
|
%
|
Translation
|
0.9
|
%
|
|
1.1
|
%
|
|
—
|
%
|
|
0.3
|
%
|
|
0.4
|
%
|
|
0.1
|
%
|
Total
|
3.5
|
%
|
|
21.2
|
%
|
|
3.0
|
%
|
|
3.9
|
%
|
|
18.5
|
%
|
|
2.4
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Automotive OEM
|
$
|
671
|
|
|
$
|
614
|
|
|
$
|
1,339
|
|
|
$
|
1,203
|
|
Test & Measurement and Electronics
|
558
|
|
|
542
|
|
|
1,077
|
|
|
1,062
|
|
||||
Food Equipment
|
537
|
|
|
491
|
|
|
1,048
|
|
|
958
|
|
||||
Polymers & Fluids
|
506
|
|
|
525
|
|
|
985
|
|
|
1,017
|
|
||||
Welding
|
470
|
|
|
480
|
|
|
933
|
|
|
952
|
|
||||
Construction Products
|
444
|
|
|
446
|
|
|
860
|
|
|
855
|
|
||||
Specialty Products
|
540
|
|
|
506
|
|
|
1,060
|
|
|
987
|
|
||||
Intersegment revenues
|
(7
|
)
|
|
(11
|
)
|
|
(14
|
)
|
|
(21
|
)
|
||||
Total Operating Revenues
|
$
|
3,719
|
|
|
$
|
3,593
|
|
|
$
|
7,288
|
|
|
$
|
7,013
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Automotive OEM
|
$
|
158
|
|
|
$
|
126
|
|
|
$
|
314
|
|
|
$
|
243
|
|
Test & Measurement and Electronics
|
85
|
|
|
74
|
|
|
148
|
|
|
142
|
|
||||
Food Equipment
|
105
|
|
|
92
|
|
|
200
|
|
|
170
|
|
||||
Polymers & Fluids
|
99
|
|
|
96
|
|
|
179
|
|
|
168
|
|
||||
Welding
|
124
|
|
|
128
|
|
|
243
|
|
|
250
|
|
||||
Construction Products
|
81
|
|
|
61
|
|
|
142
|
|
|
109
|
|
||||
Specialty Products
|
130
|
|
|
113
|
|
|
239
|
|
|
209
|
|
||||
Unallocated
|
(19
|
)
|
|
(60
|
)
|
|
(35
|
)
|
|
(83
|
)
|
||||
Total Operating Income
|
$
|
763
|
|
|
$
|
630
|
|
|
$
|
1,430
|
|
|
$
|
1,208
|
|
•
|
plastic and metal components, fasteners and assemblies for automobiles, light trucks, and other industrial uses.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
671
|
|
|
$
|
614
|
|
|
$
|
1,339
|
|
|
$
|
1,203
|
|
Operating income
|
158
|
|
|
126
|
|
|
314
|
|
|
243
|
|
||||
Operating margin %
|
23.7
|
%
|
|
20.6
|
%
|
|
23.5
|
%
|
|
20.2
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
7.8
|
%
|
|
14.2
|
%
|
|
1.2
|
%
|
|
10.3
|
%
|
|
19.0
|
%
|
|
1.6
|
%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
6.9
|
%
|
|
1.3
|
%
|
|
—
|
%
|
|
6.2
|
%
|
|
1.1
|
%
|
|
7.8
|
%
|
|
21.1
|
%
|
|
2.5
|
%
|
|
10.3
|
%
|
|
25.2
|
%
|
|
2.7
|
%
|
Acquisitions and divestitures
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Restructuring costs
|
—
|
%
|
|
2.7
|
%
|
|
0.5
|
%
|
|
—
|
%
|
|
2.7
|
%
|
|
0.5
|
%
|
Translation
|
1.4
|
%
|
|
1.9
|
%
|
|
0.1
|
%
|
|
1.0
|
%
|
|
1.5
|
%
|
|
0.1
|
%
|
Total
|
9.2
|
%
|
|
25.7
|
%
|
|
3.1
|
%
|
|
11.3
|
%
|
|
29.4
|
%
|
|
3.3
|
%
|
•
|
equipment, consumables, and related software for testing and measuring of materials, structures, gases and fluids;
|
•
|
electronic assembly equipment and related consumable solder materials;
|
•
|
electronic components and component packaging;
|
•
|
static control equipment and consumables used for contamination control in clean room environments; and
|
•
|
pressure sensitive adhesives and components for telecommunications, electronics, medical and transportation applications.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
558
|
|
|
$
|
542
|
|
|
$
|
1,077
|
|
|
$
|
1,062
|
|
Operating income
|
85
|
|
|
74
|
|
|
148
|
|
|
142
|
|
||||
Operating margin %
|
15.2
|
%
|
|
13.7
|
%
|
|
13.8
|
%
|
|
13.4
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
1.4
|
%
|
|
4.7
|
%
|
|
0.4
|
%
|
|
0.5
|
%
|
|
1.8
|
%
|
|
0.2
|
%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
8.7
|
%
|
|
1.2
|
%
|
|
—
|
%
|
|
4.5
|
%
|
|
0.6
|
%
|
|
1.4
|
%
|
|
13.4
|
%
|
|
1.6
|
%
|
|
0.5
|
%
|
|
6.3
|
%
|
|
0.8
|
%
|
Acquisitions and divestitures
|
(0.1
|
)%
|
|
0.2
|
%
|
|
—
|
%
|
|
(0.1
|
)%
|
|
0.3
|
%
|
|
—
|
%
|
Restructuring costs
|
—
|
%
|
|
(2.0
|
)%
|
|
(0.3
|
)%
|
|
—
|
%
|
|
(4.0
|
)%
|
|
(0.5
|
)%
|
Translation
|
1.4
|
%
|
|
2.1
|
%
|
|
0.2
|
%
|
|
0.9
|
%
|
|
1.4
|
%
|
|
0.1
|
%
|
Total
|
2.7
|
%
|
|
13.7
|
%
|
|
1.5
|
%
|
|
1.3
|
%
|
|
4.0
|
%
|
|
0.4
|
%
|
•
|
warewashing equipment;
|
•
|
cooking equipment, including ovens, ranges and broilers;
|
•
|
refrigeration equipment, including refrigerators, freezers and prep tables;
|
•
|
food processing equipment, including slicers, mixers and scales;
|
•
|
kitchen exhaust, ventilation and pollution control systems; and
|
•
|
food equipment service, maintenance and repair.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
537
|
|
|
$
|
491
|
|
|
$
|
1,048
|
|
|
$
|
958
|
|
Operating income
|
105
|
|
|
92
|
|
|
200
|
|
|
170
|
|
||||
Operating margin %
|
19.5
|
%
|
|
18.7
|
%
|
|
19.1
|
%
|
|
17.7
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
3.4
|
%
|
|
8.4
|
%
|
|
0.9
|
%
|
|
4.3
|
%
|
|
11.1
|
%
|
|
1.2
|
%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
(2.3
|
)%
|
|
(0.4
|
)%
|
|
—
|
%
|
|
2.8
|
%
|
|
0.4
|
%
|
|
3.4
|
%
|
|
6.1
|
%
|
|
0.5
|
%
|
|
4.3
|
%
|
|
13.9
|
%
|
|
1.6
|
%
|
Acquisitions and divestitures
|
4.1
|
%
|
|
3.1
|
%
|
|
(0.2
|
)%
|
|
3.7
|
%
|
|
2.2
|
%
|
|
(0.3
|
)%
|
Restructuring costs
|
—
|
%
|
|
3.0
|
%
|
|
0.5
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Translation
|
2.0
|
%
|
|
2.2
|
%
|
|
—
|
%
|
|
1.4
|
%
|
|
1.7
|
%
|
|
0.1
|
%
|
Total
|
9.5
|
%
|
|
14.4
|
%
|
|
0.8
|
%
|
|
9.4
|
%
|
|
17.8
|
%
|
|
1.4
|
%
|
•
|
adhesives for industrial, construction and consumer purposes;
|
•
|
chemical fluids which clean or add lubrication to machines;
|
•
|
epoxy and resin-based coating products for industrial applications;
|
•
|
hand wipes and cleaners for industrial applications;
|
•
|
fluids, polymers and other supplies for auto aftermarket maintenance and appearance;
|
•
|
fillers and putties for auto body repair; and
|
•
|
polyester coatings and patch and repair products for the marine industry.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
506
|
|
|
$
|
525
|
|
|
$
|
985
|
|
|
$
|
1,017
|
|
Operating income
|
99
|
|
|
96
|
|
|
179
|
|
|
168
|
|
||||
Operating margin %
|
19.6
|
%
|
|
18.3
|
%
|
|
18.1
|
%
|
|
16.5
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
(3.0
|
)%
|
|
(7.1
|
)%
|
|
(0.8
|
)%
|
|
(1.7
|
)%
|
|
(4.5
|
)%
|
|
(0.5
|
)%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
10.3
|
%
|
|
1.9
|
%
|
|
—
|
%
|
|
10.3
|
%
|
|
1.6
|
%
|
|
(3.0
|
)%
|
|
3.2
|
%
|
|
1.1
|
%
|
|
(1.7
|
)%
|
|
5.8
|
%
|
|
1.1
|
%
|
Acquisitions and divestitures
|
—
|
%
|
|
(0.1
|
)%
|
|
—
|
%
|
|
—
|
%
|
|
(0.1
|
)%
|
|
—
|
%
|
Restructuring costs
|
—
|
%
|
|
0.1
|
%
|
|
—
|
%
|
|
—
|
%
|
|
1.4
|
%
|
|
0.2
|
%
|
Translation
|
(0.5
|
)%
|
|
—
|
%
|
|
0.2
|
%
|
|
(1.4
|
)%
|
|
(1.0
|
)%
|
|
0.3
|
%
|
Total
|
(3.5
|
)%
|
|
3.2
|
%
|
|
1.3
|
%
|
|
(3.1
|
)%
|
|
6.1
|
%
|
|
1.6
|
%
|
•
|
arc welding equipment;
|
•
|
metal arc welding consumables and related accessories; and
|
•
|
metal jacketing and other insulation products.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
470
|
|
|
$
|
480
|
|
|
$
|
933
|
|
|
$
|
952
|
|
Operating income
|
124
|
|
|
128
|
|
|
243
|
|
|
250
|
|
||||
Operating margin %
|
26.3
|
%
|
|
26.5
|
%
|
|
26.0
|
%
|
|
26.2
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
(1.8
|
)%
|
|
(2.8
|
)%
|
|
(0.3
|
)%
|
|
(1.9
|
)%
|
|
(3.0
|
)%
|
|
(0.3
|
)%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
0.4
|
%
|
|
0.1
|
%
|
|
—
|
%
|
|
1.8
|
%
|
|
0.5
|
%
|
|
(1.8
|
)%
|
|
(2.4
|
)%
|
|
(0.2
|
)%
|
|
(1.9
|
)%
|
|
(1.2
|
)%
|
|
0.2
|
%
|
Acquisitions and divestitures
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
0.6
|
%
|
|
0.1
|
%
|
|
(0.1
|
)%
|
Restructuring costs
|
—
|
%
|
|
(0.1
|
)%
|
|
—
|
%
|
|
—
|
%
|
|
(1.1
|
)%
|
|
(0.3
|
)%
|
Translation
|
(0.2
|
)%
|
|
(0.3
|
)%
|
|
—
|
%
|
|
(0.6
|
)%
|
|
(0.6
|
)%
|
|
—
|
%
|
Total
|
(2.0
|
)%
|
|
(2.8
|
)%
|
|
(0.2
|
)%
|
|
(1.9
|
)%
|
|
(2.8
|
)%
|
|
(0.2
|
)%
|
•
|
fasteners and related fastening tools for wood and metal applications;
|
•
|
anchors, fasteners and related tools for concrete applications;
|
•
|
metal plate truss components and related equipment and software; and
|
•
|
packaged hardware, fasteners, anchors and other products for retail.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
444
|
|
|
$
|
446
|
|
|
$
|
860
|
|
|
$
|
855
|
|
Operating income
|
81
|
|
|
61
|
|
|
142
|
|
|
109
|
|
||||
Operating margin %
|
18.2
|
%
|
|
13.7
|
%
|
|
16.5
|
%
|
|
12.7
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
0.4
|
%
|
|
1.1
|
%
|
|
0.1
|
%
|
|
2.4
|
%
|
|
8.3
|
%
|
|
0.7
|
%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
16.2
|
%
|
|
2.2
|
%
|
|
—
|
%
|
|
15.8
|
%
|
|
2.0
|
%
|
|
0.4
|
%
|
|
17.3
|
%
|
|
2.3
|
%
|
|
2.4
|
%
|
|
24.1
|
%
|
|
2.7
|
%
|
Acquisitions and divestitures
|
(0.8
|
)%
|
|
(0.7
|
)%
|
|
—
|
%
|
|
(0.4
|
)%
|
|
(0.4
|
)%
|
|
—
|
%
|
Restructuring costs
|
—
|
%
|
|
15.7
|
%
|
|
2.2
|
%
|
|
—
|
%
|
|
9.4
|
%
|
|
1.2
|
%
|
Translation
|
—
|
%
|
|
(0.8
|
)%
|
|
—
|
%
|
|
(1.4
|
)%
|
|
(2.8
|
)%
|
|
(0.1
|
)%
|
Total
|
(0.4
|
)%
|
|
31.5
|
%
|
|
4.5
|
%
|
|
0.6
|
%
|
|
30.3
|
%
|
|
3.8
|
%
|
•
|
line integration, conveyor systems and line automation for the food and beverage industries;
|
•
|
plastic consumables that multi-pack cans and bottles and related equipment;
|
•
|
foil, film and related equipment used to decorate consumer products;
|
•
|
product coding and marking equipment and related consumables;
|
•
|
plastic and metal fasteners and components for appliances;
|
•
|
airport ground support equipment; and
|
•
|
components for medical devices.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating revenues
|
$
|
540
|
|
|
$
|
506
|
|
|
$
|
1,060
|
|
|
$
|
987
|
|
Operating income
|
130
|
|
|
113
|
|
|
239
|
|
|
209
|
|
||||
Operating margin %
|
24.2
|
%
|
|
22.4
|
%
|
|
22.6
|
%
|
|
21.2
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||
|
June 30
|
|
June 30
|
||||||||||||||
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Increase (Decrease)
|
|
% Point Increase (Decrease)
|
||||||
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
|
Operating Revenues
|
|
Operating Income
|
|
Operating Margins
|
||||||
Base business (organic):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue change/Operating leverage
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
0.7
|
%
|
|
1.5
|
%
|
|
0.2
|
%
|
Changes in variable margins & overhead costs
|
—
|
%
|
|
11.6
|
%
|
|
2.6
|
%
|
|
—
|
%
|
|
7.7
|
%
|
|
1.6
|
%
|
|
—
|
%
|
|
11.6
|
%
|
|
2.6
|
%
|
|
0.7
|
%
|
|
9.2
|
%
|
|
1.8
|
%
|
Acquisitions and divestitures
|
5.5
|
%
|
|
1.7
|
%
|
|
(0.9
|
)%
|
|
5.7
|
%
|
|
1.5
|
%
|
|
(1.0
|
)%
|
Restructuring costs
|
—
|
%
|
|
0.2
|
%
|
|
—
|
%
|
|
—
|
%
|
|
2.7
|
%
|
|
0.6
|
%
|
Translation
|
1.3
|
%
|
|
1.7
|
%
|
|
0.1
|
%
|
|
1.0
|
%
|
|
1.4
|
%
|
|
—
|
%
|
Total
|
6.8
|
%
|
|
15.2
|
%
|
|
1.8
|
%
|
|
7.4
|
%
|
|
14.8
|
%
|
|
1.4
|
%
|
•
|
investment in existing businesses to fund internal growth;
|
•
|
payment of an attractive dividend to shareholders;
|
•
|
share repurchases; and
|
•
|
acquisitions.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net cash provided by operating activities
|
$
|
573
|
|
|
$
|
643
|
|
|
$
|
887
|
|
|
$
|
1,009
|
|
Additions to plant and equipment
|
(78
|
)
|
|
(89
|
)
|
|
(146
|
)
|
|
(178
|
)
|
||||
Free operating cash flow
|
$
|
495
|
|
|
$
|
554
|
|
|
$
|
741
|
|
|
$
|
831
|
|
|
|
|
|
|
|
|
|
||||||||
Cash dividends paid
|
$
|
(174
|
)
|
|
$
|
(171
|
)
|
|
$
|
(355
|
)
|
|
$
|
(171
|
)
|
Repurchases of common stock
|
(1,465
|
)
|
|
(334
|
)
|
|
(2,905
|
)
|
|
(677
|
)
|
||||
Acquisition of businesses (excluding cash and equivalents) and additional interest in affiliates
|
(4
|
)
|
|
(21
|
)
|
|
(6
|
)
|
|
(77
|
)
|
||||
Net proceeds from sale of discontinued operations
|
3,177
|
|
|
62
|
|
|
3,177
|
|
|
59
|
|
||||
Net proceeds from (repayments of) debt
|
(418
|
)
|
|
46
|
|
|
848
|
|
|
42
|
|
||||
Other
|
107
|
|
|
106
|
|
|
137
|
|
|
162
|
|
||||
Effect of exchange rate changes on cash and equivalents
|
32
|
|
|
(136
|
)
|
|
42
|
|
|
(180
|
)
|
||||
Net increase (decrease) in cash and equivalents
|
$
|
1,750
|
|
|
$
|
106
|
|
|
$
|
1,679
|
|
|
$
|
(11
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 30,
|
|
June 30,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Operating income
|
$
|
763
|
|
|
$
|
630
|
|
|
$
|
1,430
|
|
|
$
|
1,208
|
|
Tax rate
|
30.0
|
%
|
|
28.4
|
%
|
|
30.0
|
%
|
|
28.7
|
%
|
||||
Income taxes
|
(229
|
)
|
|
(179
|
)
|
|
(429
|
)
|
|
(347
|
)
|
||||
Operating income after taxes
|
$
|
534
|
|
|
$
|
451
|
|
|
$
|
1,001
|
|
|
$
|
861
|
|
|
|
|
|
|
|
|
|
||||||||
Invested capital:
|
|
|
|
|
|
|
|
|
|||||||
Trade receivables
|
$
|
2,598
|
|
|
$
|
2,907
|
|
|
$
|
2,598
|
|
|
$
|
2,907
|
|
Inventories
|
1,305
|
|
|
1,490
|
|
|
1,305
|
|
|
1,490
|
|
||||
Net assets held for sale
|
—
|
|
|
171
|
|
|
—
|
|
|
171
|
|
||||
Net plant and equipment
|
1,700
|
|
|
1,936
|
|
|
1,700
|
|
|
1,936
|
|
||||
Goodwill and intangible assets
|
6,780
|
|
|
7,491
|
|
|
6,780
|
|
|
7,491
|
|
||||
Accounts payable and accrued expenses
|
(1,961
|
)
|
|
(2,053
|
)
|
|
(1,961
|
)
|
|
(2,053
|
)
|
||||
Other, net
|
(69
|
)
|
|
593
|
|
|
(69
|
)
|
|
593
|
|
||||
Total invested capital
|
$
|
10,353
|
|
|
$
|
12,535
|
|
|
$
|
10,353
|
|
|
$
|
12,535
|
|
|
|
|
|
|
|
|
|
||||||||
Average invested capital
|
$
|
11,504
|
|
|
$
|
12,583
|
|
|
$
|
11,815
|
|
|
$
|
12,668
|
|
Adjustment for Wilsonart (formerly Decorative Surfaces)
|
(157
|
)
|
|
(171
|
)
|
|
(159
|
)
|
|
(172
|
)
|
||||
Adjustment for Industrial Packaging
|
(409
|
)
|
|
(1,480
|
)
|
|
(771
|
)
|
|
(1,483
|
)
|
||||
Adjusted average invested capital
|
$
|
10,938
|
|
|
$
|
10,932
|
|
|
$
|
10,885
|
|
|
$
|
11,013
|
|
Annualized adjusted return on average invested capital
|
19.5
|
%
|
|
16.5
|
%
|
|
18.4
|
%
|
|
15.6
|
%
|
(Dollars in millions)
|
June 30, 2014
|
|
December 31, 2013
|
|
Increase/
(Decrease)
|
||||||
Current assets:
|
|
|
|
|
|
||||||
Cash and equivalents
|
$
|
5,297
|
|
|
$
|
3,618
|
|
|
$
|
1,679
|
|
Trade receivables
|
2,598
|
|
|
2,365
|
|
|
233
|
|
|||
Inventories
|
1,305
|
|
|
1,247
|
|
|
58
|
|
|||
Other
|
591
|
|
|
750
|
|
|
(159
|
)
|
|||
Assets held for sale
|
—
|
|
|
1,836
|
|
|
(1,836
|
)
|
|||
|
9,791
|
|
|
9,816
|
|
|
(25
|
)
|
|||
Current liabilities:
|
|
|
|
|
|
||||||
Short-term debt
|
1,070
|
|
|
3,551
|
|
|
(2,481
|
)
|
|||
Accounts payable and accrued expenses
|
1,961
|
|
|
1,906
|
|
|
55
|
|
|||
Other
|
892
|
|
|
260
|
|
|
632
|
|
|||
Liabilities held for sale
|
—
|
|
|
317
|
|
|
(317
|
)
|
|||
|
3,923
|
|
|
6,034
|
|
|
(2,111
|
)
|
|||
Net working capital
|
$
|
5,868
|
|
|
$
|
3,782
|
|
|
$
|
2,086
|
|
Current ratio
|
2.5
|
|
|
1.6
|
|
|
|
(Dollars in millions)
|
June 30, 2014
|
|
December 31, 2013
|
||||
Short-term debt
|
$
|
1,070
|
|
|
$
|
3,551
|
|
Long-term debt
|
6,140
|
|
|
2,793
|
|
||
Total debt
|
$
|
7,210
|
|
|
$
|
6,344
|
|
(In millions)
|
|
||
Total stockholders’ equity, December 31, 2013
|
$
|
9,709
|
|
Net income
|
1,965
|
|
|
Cash dividends declared
|
(340
|
)
|
|
Repurchases of common stock
|
(2,977
|
)
|
|
Stock option and restricted stock activity
|
108
|
|
|
Foreign currency translation adjustments
|
(22
|
)
|
|
Other
|
(3
|
)
|
|
Total stockholders’ equity, June 30, 2014
|
$
|
8,440
|
|
•
|
fluctuation in currency exchange rates;
|
•
|
limitations on ownership or participation in local enterprises;
|
•
|
price controls, exchange controls and limitations on repatriation of earnings;
|
•
|
transportation delays and interruptions;
|
•
|
political, social and economic instability and disruptions;
|
•
|
acts of terrorism;
|
•
|
government embargoes or foreign trade restrictions;
|
•
|
the imposition of duties and tariffs and other trade barriers;
|
•
|
import and export controls;
|
•
|
labor unrest and current and changing regulatory environments;
|
•
|
the potential for expropriation or nationalization of enterprises;
|
•
|
difficulties in staffing and managing multi-national operations;
|
•
|
limitations on its ability to enforce legal rights and remedies; and
|
•
|
potentially adverse tax consequences.
|
Exhibit Number
|
Exhibit Description
|
|
|
3.1
|
Amended and Restated Certificate of Incorporation of Illinois Tool Works Inc.
|
|
|
4.1
|
Officers’ Certificate dated May 20, 2014, establishing the terms, and setting forth the forms, of the 1.75% Euro Notes due 2022 and the 3.0% Euro Notes due 2034, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed May 22, 2014 (Commission File No. 1-4797) and incorporated herein by reference.
|
|
|
10.1
|
Illinois Tool Works Inc. Amended and Restated Directors' Deferred Fee Plan
|
|
|
31
|
Rule 13a-14(a) Certification.
|
|
|
32
|
Section 1350 Certification.
|
|
|
101
|
The following financial and related information from the Illinois Tool Works Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 is formatted in Extensible Business Reporting Language (XBRL) and submitted electronically herewith: (i) Statement of Income, (ii) Statement of Comprehensive Income, (iii) Statement of Financial Position, (iv) Statement of Cash Flows and (v) related Notes to Financial Statements.
|
|
|
|
|
|
|
|
|
ILLINOIS TOOL WORKS INC.
|
|
|
|
|
|
|
|
|
|
Dated:
|
August 8, 2014
|
By:
|
/s/ Randall J. Scheuneman
|
|
|
|
Randall J. Scheuneman
|
|
|
|
Vice President & Chief Accounting Officer
|
|
|
|
(Principal Accounting Officer and Duly Authorized Officer)
|
(a)
|
Initial Election
. A Director’s Cash Account shall be paid in a lump-sum within 60 days after his/her Separation from Service; provided that the Director may elect (using a form approved by the Company) at the time of his/her initial Deferral Election to have his/her Cash Account paid in monthly installments over two to 20 years.
|
(b)
|
Change to Prior Election
. A Director may elect (using a form approved by the Company) to change a form of payment previously elected with respect to his or her Cash Account (or if the Director had made no election, then to elect a form other than the lump-sum), provided (i) such new election does not take effect until at least 12 months after the date the election is made, and (ii) if commencement of payment is not related to the Director's Disability or death, the first payment with respect to which such new election is effective is deferred for a period of five years from the date such payment would otherwise have commenced.
|
(c)
|
Payment of Share Accounts
. Subject to Section 4.2, a Director’s Share Account, if any, shall be paid in a single lump-sum within 60 days following the Director’s Separation from Service in the form of shares of Common Stock, which shall be issued to the Director or his/her Beneficiary pursuant to the Long-Term Incentive Plan. The number of shares of Common Stock to be issued to the Director or his/her Beneficiary shall be equal to the number of Share Units credited to the Director’s Share Account at such time, with any fractional Share Unit paid in cash based on current Fair Market Value.
|
1.
|
I have reviewed this report on Form 10-Q of Illinois Tool Works Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated:
|
August 8, 2014
|
|
/s/ E. Scott Santi
|
|
|
|
E. Scott Santi
|
|
|
|
President & Chief Executive Officer
|
1.
|
I have reviewed this report on Form 10-Q of Illinois Tool Works Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated:
|
August 8, 2014
|
|
/s/ Michael M. Larsen
|
|
|
|
Michael M. Larsen
|
|
|
|
Senior Vice President & Chief Financial Officer
|
Dated:
|
August 8, 2014
|
|
/s/ E. Scott Santi
|
|
|
|
E. Scott Santi
|
|
|
|
President & Chief Executive Officer
|
Dated:
|
August 8, 2014
|
|
/s/ Michael M. Larsen
|
|
|
|
Michael M. Larsen
|
|
|
|
Senior Vice President & Chief Financial Officer
|