Illinois Tool Works (ITW), a leading industrial products and equipment manufacturer, has announced a decline in its fourth-quarter profit. This can be attributed, in part, to auto worker strikes and inventory pullbacks that have affected sales volume.
Profit and Earnings
Despite reporting a profit of $717 million for the quarter, or $2.38 per share, compared to $907 million, or $2.95 per share, in the same period the previous year, ITW’s performance fell short. However, after accounting for Argentina’s currency devaluation, per-share adjusted earnings were slightly better at $2.42, exceeding the consensus estimate of analysts surveyed by FactSet by one penny.
Revenue and Expectations
ITW recorded revenue of $3.98 billion in the fourth quarter, a slight increase from $3.97 billion in the year-ago quarter. Although the figure marginally surpassed the consensus estimate of $3.01 billion, divestitures made in the previous year contributed to lower revenue growth this time around. Additionally, factors such as channel inventory reduction and labor strikes in the automotive industry further impacted revenue performance.
Outlook for 2024
Despite the challenges faced in the fourth quarter, ITW remains optimistic about its future prospects. The company projects earnings between $10 and $10.40 per share for 2024, coupled with annual revenue growth of 2% to 4%. These estimates align closely with current analyst forecasts.
ITW continues to focus on overcoming the setbacks experienced in recent months and is committed to delivering substantial growth in the coming years.
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