ITT Corporation

ITT Industries Reports 20% Net Income Gain in 1996; Chief Executive Engen Credits Employees for First Year Progress

    1/28/1997

        WHITE PLAINS, N.Y., Jan. 28 /PRNewswire/ -- ITT Industries, Inc.
    (NYSE: IIN) today reported full year 1996 net income of $222.6 million, or
    $1.85 per fully diluted share.  Earnings increased 20.3% over the
    $185.0 million or $1.57 per share reported in 1995.  The 1995 figure is
    adjusted to remove the $164.3 million  provided for the disposition of  non-
    core units.  Operating income reached $508.4 million, up $62.2 million or
    13.9% over the 1995 figure.  Total sales of $8.72 billion were down slightly
    from the $8.88 billion level in 1995 due to the disposition of certain non-
    core operations and somewhat lower sales in automotive parts.
        For the fourth quarter, earnings per share were $0.59, more than double
    the comparable $0.28 in 1995.  Charges of $49.6 million associated with the
    disposition of non-strategic assets in the fourth quarter of 1995 had resulted
    in a reported net loss of $16.2 million.  Operating income from ongoing
    segments for the quarter was $157.0 million, up 20.1% from $130.7 million
    reported in 1995, reflecting the company's strong commitment to cost
    reductions.  Sales from ongoing segments in the fourth quarter were
    $2.17 billion which represents an increase of $44.6 million or 2.1% versus
    1995.
        "ITT Industries delivered generally improved results in 1996, including
    double digit earnings growth," said Travis Engen, Chairman, President and
    Chief Executive.  "During the year we secured several important business
    contract wins, and made key technical advances in all three of our business
    areas.  1996 was a year of substantial progress for ITT Industries as we
    successfully launched our newly independent company."
        Important corporate milestones  which marked 1996 include the following:
        -- All three operating businesses aggressively expanded their global
           presence.  In particular, ITT Defense and Electronics' international
           revenues reached 15% of total defense sales, reflecting a focus to
           expand internationally.  ITT Fluid Technology, with more than half of
           its sales from outside the U.S., further expanded its manufacturing and
           distribution capacity in emerging markets, which now account for more
           than 15% of sales.  ITT Automotive revenues generated outside North
           America represented more than 50% of total Automotive revenues for the
           year.
        -- Net debt was reduced by more than $215 million, improving financial
           flexibility.
        -- Return on Total Capital increased for the fourth consecutive year,
           reaching a record 14.6% in 1996.
        "These achievements are a credit to the energy and commitment of  all ITT
    Industries employees, now numbering almost 59,000 worldwide," said Engen.
    "They are responsible for the important advances in our first year as an
    independent company.  Having completed this important first year, we will
    continue to work to create value for our shareholders, our customers, our
    employees, and the communities in which we do business."
    
        Primary Business Results
        ITT Automotive recorded operating income of $337.1 million, down slightly
    from $343.6 million in the prior year.  Sales were $5.49 billion for 1996
    against $5.57 billion last year.  The ramp up of the new MK20 ABS product
    line, inefficiencies caused by the two GM Corporation strikes and continued
    price pressures in the industry affected earnings.  During the year,
    Automotive secured a number of very important contracts for advanced braking
    systems and introduced several new products in its electrical systems group.
    The focus in 1997 will be on product and profitability enhancement programs.
        ITT Defense & Electronics' operating income of $110.2 million was up
    $13.6 million or 14.1% for the year.  Income growth was generated both in the
    defense and the interconnect segments of the business.  Sales were
    $1.57 billion for the year, up slightly from $1.56 billion in 1995.  ITT
    Defense & Electronics saw progress on a number of important fronts in 1996.
    International defense sales and future prospects were improved as major
    contract wins created significant increases in the total order backlog to
    $2.3 billion.  Market leadership positions in tactical communications, night
    vision and airborne electronic warfare were also enhanced.  The company's
    interconnect business, ITT Cannon, improved both in financial performance and
    market positioning during the year.
        ITT Fluid Technology reported operating income of $113.2 million in 1996,
    up slightly from $112.8 million.  Sales of $1.30 billion increased 4.3% from
    $1.25 billion in 1995.  Excluding the General Controls business, which was
    sold early in the year, sales increased 6.0%.  Fluid Technology made important
    advances in a year that saw negative impact both from a key European market
    slowdown and foreign exchange swings.  Fluid Technology's development of
    emerging markets, new products and technologies, and important cost
    improvement programs have positioned this dynamic business to continue its
    advances in market penetration and in financial performance.  In particular,
    aggressive expansion in developing countries will help maintain growth rates
    above industry averages.
    
            ITT Industries Fourth Quarter and Total Year Financial Results
                           (In millions, except per share)
    
                                     Fourth Quarter             Total Year
                                    1996        1995*       1996        1995*
        Total Sales               $2,231.2    $2,251.3    $8,718.1    $8,884.2
        Operating Income          $  141.8    $  109.2    $  508.4    $  446.2
        Net Income                $   71.2    $   33.4    $  222.6    $  185.0
        Averages shares outstanding  120.6       117.9       120.4       117.7
        Earnings per share        $   0.59    $   0.28    $   1.85    $   1.57
    
        * Adjusted to exclude one-time charges
    
        ITT Industries is a leading worldwide diversified manufacturing company,
    with 1996 sales of $8.4 billion from its three primary business segments:
    Automotive, Defense & Electronics, and Fluid Technology.  ITT Automotive is
    one of the world's largest independent suppliers of systems and components to
    automotive manufacturers. ITT Defense & Electronics is a world leader in the
    design, manufacture and support of high technology electronic systems and
    components for defense and commercial markets.  ITT Fluid Technology is one of
    the world's leading manufacturers of products, systems and services for the
    movement, measurement, and control of fluids.
        In addition to the New York Stock Exchange, ITT Industries' stock is
    traded under the symbol ("IIN") on the Midwest, Pacific, London, Frankfurt and
    Paris exchanges.
    SOURCE  ITT Industries, Inc.
    
    

    CONTACT: Ralph D. Allen or Theodore P. Economou of ITT
    Industries, 914-641-2030 or http://www.ittind.com

About ITT

ITT is a diversified leading manufacturer of highly engineered critical components and customized technology solutions for the transportation, industrial, and oil and gas markets. Building on its heritage of innovation, ITT partners with its customers to deliver enduring solutions to the key industries that underpin our modern way of life. ITT is headquartered in White Plains, N.Y., with employees in more than 35 countries and sales in a total of approximately 125 countries. The company generated 2016 revenues of $2.4 billion.

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Jason Moss
tel +1 914-641-2030
jason.moss@itt.com

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Laurent Lawrence
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laurent.lawrence@itt.com

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