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ITW

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54 reviews

About ITW

Illinois Tool Works (ITW) hammers out more than just tools, and it operates well beyond the Land of Lincoln. With operations in about 60 countries, ITW manufactures and services equipment for the automotive, construction, electronics, food/beverage, packaging, power system, decorative surfaces, and medical (adhesives) industries. The largest of its – more... eight segments is Transportation, which provides metal and plastic fasteners, fluids, and body repair putties, as well as truck remanufacturing. Second in sales, Power Systems & Electronics churns out arc welding equipment and airport ground support equipment. ITW gets about half of its sales from North America.

The company operates 52 internally reported operating segments that are aggregated into eight external reportable segments. Transportation operates about 100 plants and office facilities. Major trademarks in this segment include Deltar and Shakeproof. Customers in this segment are made up principally of OEMs (56%) and automotive aftermarket operations (31%).

Operating some 110 facilities, Power Systems & Electronics makes equipment and consumables for applications that include specialty power conversion, metallurgy, and electronics. A major brand of this segment is Miller. Industrial Packaging, with more than 130 locations, provides products for applications that include bundling, shipping, and protection of goods in transit. A major brand is Signode.

With about 50 facilities, Food Equipment includes the Hobart brand (commercial kitchen appliances). Food equipment products include equipment for warewashing, cooking, refrigeration, and food processing. With more than 90 facilities, Construction Products include the Paslode brand. Products include produce tools and fasteners. Polymers & Fluids makes adhesives, sealants, lubrication and cutting fluids, and hygiene products. The segment operates more 90 facilities.

ITW owns 49% of its Decorative Surfaces segment, which includes the brand Wilsonart and operates through 10 facilities. Products include decorative high-pressure laminate for furniture, office and retail settings, and countertops, as well as high-pressure laminate worktops. Customers making up this segment include commercial construction (55%), renovation construction (30%), and residential construction (14%). In late 2012 ITW divested its 51% stake in this segment to an investment fund for $1.05 billion in cash.

The Other segment (more than 190 sites of operation) includes software for testing and measuring materials and structures, product coding equipment, conveyor systems, and plastic reclosable packaging.

Revenue increased 15% in 2011 compared to 2010 on the back of base revenues, revenues from acquisitions, and favorable currency exchange rates as demand grew from such markets as welding, transportation, and measurement. Transportation revenue rose 23% thanks in part to growth in North American, European, Chinese, and Indian auto builds. Power Systems & Electronics went up 19%, supported by demand for welding products from the oil and gas, manufacturing, and infrastructure markets. Industrial Packaging enjoyed an uptick of 15% as the result in part of higher steel and plastic strapping prices and a jump in equipment sales and demand for protective packaging.

Food Equipment inched up about 7% to meet demand from the casual dining restaurant market, among other factors. Construction Products were able to build revenue up to about 12% with a foundation of business from commercial construction in Europe, as well as the renovation and residential markets in the US. Polymers & Fluids flowed up 23% in 2011 compared to 2010, pushed by North American and Asia/Pacific end market demand. Decorative Surfaces spruced up with a rise of about 11% in 2011 compared to 2010 while revenue for the Other segment swelled about 13%. Congruent with the company's healthy sales, net income has been steadily rising, from $972.7 million in 2009 to $1.5 billion in 2010 to $2.1 billion in 2011.

ITW's operating strategy for mergers and acquisitions (M&A) is turbo-charged. The company's strategy focuses on 20% of its core operations that generate about 80% of its revenue. Conversely, ITW keeps the remaining 80% of its businesses (that contribute only 20% to its revenues) small so that management of customer and supplier relationships is easier. ITW paid $1.3 billion for 28 companies in 2011. To fuel its M&A strategy, the multinational manufacturer focuses on small to midsized companies with complementary products. Acquisitions of large companies are intended to develop new platforms. ITW practices a decentralized business structure that allows more concentration on end markets and the specific needs of local customers.

Innovation is a big selling point for ITW's myriad of products. It increased its research and development spending by about 14% in 2011 over 2010. The company holds about 12,300 US and foreign patents, as well as 6,700 patents pending. R&D is executed cooperatively with customers seeking specific applications. 

Along with its acquisitions come divestitures. ITW is selling 51% of the Decorative Surfaces segment to Clayton, Dubilier & Rice for about $1.05 billion. The divestment will allow ITW focus on core segments while retaining some value in Decorative Surfaces, which is expected to enjoy more sales as the construction sector strengthens. ITW in spring 2012 sold its finishing group of businesses to fluid-handling equipment specialist Graco for $650 million. Included in the sale were ITW companies such as Binks (spray guns) and Gema, which makes paint and spray systems for industrial applications. The company also sold its electronic components business in the power systems and electronics segment, and it is divesting its consumer packaging operations in the "all other" segment. – less

ITW Employer Reviews

packager (Former Employee), Markham, ONMay 28, 2012
National Sales Manager (Former Employee), Rockland, MADecember 11, 2014
Senior Internation Exports Manager (Former Employee), Worldwide.December 3, 2014
National Account Manager (Current Employee), Troy, OHNovember 18, 2014
Assistant Accountant (Former Employee), Bangalore, KAOctober 16, 2014