Industrial equipment maker Illinois Tool Works Inc. (ITW) Tuesday reported higher third-quarter profit, reflecting increased revenues and margin expansion. The company also lifted its earnings outlook for full year 2014.
For the quarter, net income increased to $531 million or $1.34 per share from $452 million or $1.01 per share in the prior year. Earnings from continuing operations were $1.28 per share, up from $0.90 per share in the year-ago period.
On average, 18 analysts polled by Thomson Reuters expected the company to earn $1.23 per share for the quarter. Analysts' estimates typically exclude special items.
Operating revenues for the quarter grew 3.5 percent to $3.69 billion from $3.57 billion in the preceding year. Sixteen analysts projected quarterly revenues of $3.68 billion.
Organic revenues were up 3.5 percent, with North American and international growth of 4 percent and 3 percent, respectively.
Automotive OEM organic revenue rose 8 percent, Food Equipment's organic revenues increased 5 percent, and Welding's organic revenues grew 5 percent from last year.
Operating margins were 20.9 percent, up 190 basis points from last year.
Scott Santi, president and chief executive officer of the company stated, "These results reflect continued progress in the execution of our enterprise strategy as we position ITW for solid organic growth with best-in-class margins and returns."
Looking ahead to the fourth quarter, the company expects earnings to be in a range of $1.07 to $1.15 per share, on 2 to 3 percent organic revenue growth. Total revenue growth in the quarter is projected to be flat due to currency translation effects.
Analysts currently expect fourth quarter earnings of $1.13 per share, on revenues of $3.64 billion.
For full-year 2014, the firm now expects earnings to be in the range of $4.57 to $4.65 per share, up from its prior range of $4.50 to $4.62 per share. Analysts now expect full-year 2014 earnings of $4.58 per share.
ITW is currently trading at $85.47, up 2.47 percent.
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