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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): December 17, 2003
ITT INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Indiana 1-5627 13-5158950
--------------- ------------ -------------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
organization)
4 West Red Oak Lane
White Plains, New York 10604
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (914) 641-2000
(Former name or former address if changed since last report)
ITEM 9. Regulation FD Disclosure
The following information is furnished pursuant to Item 9 "Regulation FD
Disclosure"and Item 12 "Results of Operations and Financial Condition." This
information shall not be deemed filed for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") or incorporated
by reference into any filing under the Securities Act of 1933, as amended, or
the Exchange Act, except as shall be expressly set forth by specific reference
in such filing.
On December 17, 2003 ITT Industries, Inc. issued a press release providing its
2004 financial outlook. This press release is attached and incorporated by
reference herein as Exhibit 99.1.
Exhibit Index
(99.1) Press release dated December 17, 2003 issued by ITT Industries, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ITT INDUSTRIES, INC.
By: /s/ Kathleen S. Stolar
-----------------------------
Kathleen S. Stolar
Its: Vice President, Secretary
and Associate General Counsel
Date: December 17, 2003
Exhibit 99.1
ITT Industries Provides 2004 Financial Outlook
* Strong organic revenue growth trend seen continuing in 2004
* New products, enhanced competitive positions to enable growth in
margins
* Company reaffirms previous FY 2003 earnings guidance
WHITE PLAINS, N.Y., Dec. 17 /PRNewswire-FirstCall/ -- ITT Industries, Inc.
(NYSE: ITT) said today that better operating performance in 2003 and improving
conditions in key markets point to solid growth opportunities for the company
in the coming year. The company said that it expects full year 2004 earnings
per share between $4.05 and $4.25. Robust overall economic growth could put
the full year 2004 EPS figure towards the top end of that range.
"A stream of new products and improved competitive positions have provided
the foundation of our strength and have enabled us to meet our commitments in
2003, with unexpectedly strong organic revenue and operating gains in Defense
and the water/wastewater businesses more than offsetting weakness within the
Electronic Components group," said Lou Giuliano, Chairman, President and Chief
Executive Officer of ITT Industries. "We expect to see 5 percent organic
revenue growth in 2003, and possibly higher in 2004. This continued growth is
largely due to our Value-Based Six Sigma and Product Development initiatives,
coupled with improved market conditions. With these, we expect that we will
be able to grow our margins in the coming year."
"Our projected 5 - 10 percent operating earnings growth in 2004 includes
an anticipated $0.31 - $0.40 per share headwind from pension and healthcare
costs for 2004," Giuliano added. "Our ability to grow earnings in the face of
these headwinds is a testament to the strength and agility of our leadership
team."
Giuliano reaffirmed ITT's previous full year 2003 earnings guidance. The
company's GAAP full-year estimated earnings range includes a net $0.34 per
share positive impact from special items, for a full year estimated 2003 GAAP
EPS of $4.18 - $4.20. Before the benefit of special items, earnings per share
is expected to be $3.84 - $3.86.
"We look to 2004 with great anticipation, expanding our capabilities
through new products, services and acquisitions, while continuing to focus on
meeting the needs of our customers and accelerating our improvement
initiatives to grow our businesses," Giuliano said.
2004 Forecast Segment Highlights
Fluid Technology
The water/wastewater businesses are expected to lead improvement in Fluid
Technology in 2004, with regulatory requirements in the US and Europe,
continued infrastructure investment in Asia and product innovation expected to
enable revenue growth in this segment of 4 - 6 percent to $2.32 - 2.37 billion
for the year. Operating margin is expected to grow 20 to 100 basis points to
13 - 13.5 percent. The company's tender offer for WEDECO Water Technology is
underway, and if successful will enhance the company's current wastewater
treatment product offering to include ultraviolet disinfection and ozone
oxidation water treatment, and represents the continuation of ITT's strategy
of providing customers with the world's leading water and wastewater product
portfolio. The potential impact of this acquisition is not included in the
revenue growth forecast for Fluid Technology; the earnings impact is expected
to be neutral in 2004.
Defense Electronics & Services
The company's Defense Electronics & Services business is expected to
extend its growth trend in 2004, due in part to increased activity in its
operations support and technical services businesses and through increasing
international product sales. The company also expects further growth in its
other government-related businesses such as space, where ITT is leveraging
advanced technologies for the next generation of weather satellites. Overall,
the company anticipates 2004 Defense segment revenue growth of 8 - 10 percent
to $1.88 - $1.93 billion, with operating margins holding even at
10 - 10.5 percent.
Motion & Flow Control
New product offerings and gains in share in the company's more attractive
markets are expected to continue in the Motion & Flow Control segment. The
automotive tubing business has booked strong orders in 2003, which are
expected to positively impact the business beginning in 2005. The company is
leveraging its quick-connect technology to non-traditional uses such as
household plumbing, as well as its own spa-whirlpool and leisure marine
product offerings. These and other product synergies are expected to offset
the loss of some automotive platforms, and Motion & Flow Control revenues are
expected to remain flat in 2004 at $935 - 975 million, while operating margins
are expected to grow 40 - 110 basis points to 14.5 - 15 percent.
Electronic Components
A modest recovery in some end markets and the introduction of new products
such as the universal contact for wireless handsets and the photonic high
density optical connector are expected to contribute to improvement in
revenue and margin in the Electronic Components segment. The company will
continue executing its strategy of developing new non-commodity specialty
engineered products to increase content for targeted customers. Full year
revenues in this segment are expected to grow 2 - 4 percent to
$600 - 640 million, with operating margins expected to rise 200-500 basis
points to 6 - 7 percent, as the company sees the benefit of new products,
improved customer service and restructuring actions.
NOTE: ITT Industries believes that investors' understanding of the
company's operating performance is enhanced by the use of certain non-GAAP
financial measures, including adjusted GAAP EPS, which Management considers
useful in providing insight into operating performance, as it excludes the
impact of special items that cannot be expected to recur on a quarterly basis.
Management also believes that investors can better analyze the company's
revenue growth by utilizing an organic revenue growth measure that excludes
the effect of foreign exchange translation and the effect of recent
acquisitions. Adjusted EPS and organic revenue are not financial measures
under GAAP, should not be considered as substitutes for EPS, net income or
revenue as defined by GAAP, and may not be comparable to similarly titled
measures reported by other companies. A reconciliation to the GAAP
equivalents of these non-GAAP measures is set forth in the attached unaudited
financial information.
About ITT Industries
ITT Industries, Inc. (www.itt.com) supplies advanced technology products
and services in key markets including: electronic interconnects and switches;
defense communication, opto-electronics, information technology and services;
fluid and water management and other specialty products. Headquartered in
White Plains, NY, the company generated $4.99 billion in 2002 sales.
In addition to the New York Stock Exchange, ITT Industries stock is traded
on the Paris, Frankfurt, Midwest and Pacific exchanges.
Certain material presented herein consists of forward-looking statements
which involve known and unknown risks, uncertainties and other important
factors that could cause actual results to differ materially from those
expressed in, or implied from, such forward-looking statements. Such factors
include general economic conditions, foreign currency exchange rates,
competition and other factors all as more thoroughly set forth in Item 1.
Business and Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations - Forward-Looking Statements in the ITT
Industries, Inc. Form 10-K Annual Report for the fiscal year ended December
31, 2002, and other of its filings with the Securities and Exchange
Commission.
ITT Industries Non-GAAP Press Release Slide Reconciliation
2003 Reported vs. Adjusted EPS
Q4 Full Year
Range Range
Q1 Q2 Q3 Q4 Q4 FY FY
2003 2003 2003 2003 2003 2003 2003
Fore- Fore- Fore- Fore-
Actual Actual Actual cast cast cast cast
Diluted Earnings Per
Share - GAAP $0.92 $1.06 $1.16 $1.04 $1.06 $4.18 $4.20
Other Adjustments (0.17) (0.08) (0.21) (0.11) (0.11) (0.57) (0.57)
Restructuring 0.08 0.04 0.01 0.10 0.10 0.23 0.23
Adjusted Earnings Per
Share - NON-GAAP $0.83 $1.02 $0.96 $1.03 $1.05 $3.84 $3.86
ITT Industries Non-GAAP Press Release Reconciliation
Reported vs. Organic Revenue Growth
2003
($ Millions)
(As Reported - GAAP)
Sales & Sales & %
Revenues Revenues Change Change
2003 2002 2003 vs. 2002 2003 vs. 2002
ITT Industries -
Consolidated High Range 5,595.0 4,985.3 609.7 12%
ITT Industries -
Consolidated Low Range 5,485.0 4,985.3 499.7 10%
(As Adjusted - Organic)
Acqui- Adj.
sition FX Sales Sales %
Sales & Contri- Contri- & & Change Change
Revenues bution bution Revenue Revenue Adj. 03 Adj. 03
2003 2003 2003 2003 2002 vs. 02 vs. 02
ITT Industries -
Consolidated
High Range 5,595.0 (156.0) (226.4) 5,212.6 4,985.3 227.3 5%
ITT Industries -
Consolidated
Low Range 5,485.0 (156.0) (226.4) 5,102.6 4,985.3 117.3 2%
SOURCE ITT Industries, Inc.
-0- 12/17/2003
/CONTACT: Tom Glover of ITT Industries, Inc., +1-914-641-2160,
tom.glover@itt.com/
/Web site: http://www.itt.com /
(ITT)
CO: ITT Industries, Inc.
ST: New York
IN: CPR ECP SEM
SU: ERN ERP