- 2011 revenue up 11 percent to $2.1 billion with strong growth in emerging markets
- Impacts associated with spin-offs of defense and water businesses drove 2011 loss from continuing operations of ($6.23) per share
- 2011 adjusted pro forma earnings per share from continuing operations was $1.60 per share, a 23 percent increase over 2010, reflecting solid segment operating margin expansion
- 2012 adjusted earnings per share guidance is $1.62 to $1.72 per share
WHITE PLAINS, N.Y., February 29, 2012 – ITT Corporation (NYSE: ITT) today reported its 2011 financial performance, including solid gains in revenue and segment operating margin expansion achieved during a year when the company executed a successful separation plan that transformed ITT into a diversified global industrial company.
As previously announced, the company had annual revenue of $2.1 billion, reflecting overall growth of 11 percent and organic growth of 9 percent compared with the prior year. Revenue results included 19 percent growth in emerging markets as well as solid gains in core markets such as oil and gas, transportation and aerospace.
Adjusted pro forma income from continuing operations, which excludes special items and includes pro forma adjustments, was $150 million, or $1.60 per share, a 23 percent increase over 2010, reflecting strong revenue growth and operating performance. Special items primarily include costs incurred to complete the separation plan, including debt extinguishment, as well as tax items and asbestos-related costs. Pro forma adjustments relate to the net interest expense due to the extinguishment of debt in connection with the separation plan.
"As a more focused industrial ITT, we are now well-positioned for profitable growth. We are delivering strong operating performance and are already making progress against our key growth drivers," said CEO and President Denise Ramos.
"Our successes include achieving double-digit growth in emerging markets and enhancing our global footprint in China and Brazil, completing the acquisition of Blakers Pump Engineers in Australia, and continuing to strengthen our relationships with our customers. We believe this gives us a very strong foundation from which to continue creating value for customers, employees and shareowners in 2012."
Fourth-quarter organic revenue increased 10 percent to $518 million compared with the fourth quarter of 2010. Impacts associated with the spin-offs of ITT’s defense and water businesses were reflected in fourth-quarter results as the company reported a loss from continuing operations of ($5.86) per share. Adjusted pro forma income from continuing operations was $34 million, or $0.36 per share, reflecting year-over-year growth of 20 percent.
2011 Full-Year Business Segment Results
Industrial Process
Industrial Process designs and manufactures industrial pumps and valves for the oil and gas, chemical, mining and industrial markets.
- Full-year 2011 total revenue was $767 million, up 11 percent compared with 2010, as a result of solid gains in the North American chemical, oil and gas, and power markets and the South American, Eastern European and Middle Eastern oil and gas markets.
- For the full year, adjusted operating income for the segment was $94 million, an 18 percent year-over-year increase, driven by increased sales volume and net cost reductions from productivity and sourcing initiatives.
Motion Technologies
Motion Technologies designs and manufactures braking technologies and shock absorbers for the automotive and rail markets.
- In Motion Technologies, full-year 2011 revenue increased 16 percent to $634 million due to gains in the European original equipment manufacturer automotive, North American automotive, and European and Chinese rail markets.
- For the full year, adjusted operating income for the business was $86 million, a 2 percent increase compared with 2010, reflecting increased sales volume offset by mix and increased material costs.
Interconnect Solutions
Interconnect Solutions designs and manufactures connectors and interconnects for the aerospace, industrial and transportation markets.
- Full-year 2011 revenue for Interconnect Solutions was $418 million, a 1 percent increase compared with full-year 2010, as first-half strength in the aerospace, transportation, oil and gas, and defense markets was primarily offset by a general market decline in the second half.
- Adjusted operating income for the full year was $41 million, up 9 percent compared with 2010, as cost reduction actions, operating productivity and lower warranty and compensation-related costs offset increased materials cost and negative mix shift.
Control Technologies
Control Technologies designs and manufactures products including fuel management, actuation, and noise and energy absorption components for the aerospace and industrial markets.
- In Control Technologies, full-year 2011 revenue increased 16 percent to $318 million due to growth in commercial aerospace, European industrial and Chinese rail markets.
- 2011 full-year adjusted operating income was $58 million, an increase of 83 percent, driven by favorable volume and mix, operating adjustments and improved effectiveness in our industrial businesses.
Guidance
The company announced guidance for full-year 2012 of adjusted earnings in the range of $1.62 to $1.72 per share. Total revenue is expected to grow 5 to 7 percent including expected market share gains as well as the impact of late-cycle strength in oil and gas and mining. The company also expects emerging markets growth will be approximately 10 percent driven by oil and gas in the Middle East and in South America, automotive gains in China and new global platforms and products. As a result, ITT expects solid adjusted segment operating margin growth of 40 basis points as productivity offsets additional costs related to the spin and drives incremental investments.
Investor Call Today
ITT's senior management will host a conference call for investors today at 9 a.m. Eastern Standard Time to review full-year performance and answer questions. The briefing can be monitored live via webcast at the following address on the company's Web site: www.itt.com/investors.