| Document and Company Information (USD $) | ||
| In Thousands | 6 Months Ended
Jun. 30, 2009 | Jun. 30, 2008
|
| Document And Company Information [Abstract] | ||
| Entity Registrant Name | Illinois Tool Works Inc. | |
| Entity Central Index Key | 0000049826 | |
| Document Type | 10-Q | |
| Document Period End Date | 2009-06-30 | |
| Amendment Flag | false | |
| Current Fiscal Year End Date | --12-31 | |
| Entity Well-known Seasoned Issuer | Yes | |
| Entity Voluntary Filers | No | |
| Entity Current Reporting Status | Yes | |
| Entity Filer Category | Large Accelerated Filer | |
| Entity Public Float | $20,000,000 | |
| Entity Common Stock Shares Outstanding | 500,145 |
| Statement of Income (USD $) | ||||
| In Thousands | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
| Operating Revenues | $3,392,906 | $4,555,881 | $6,539,285 | $8,681,691 |
| Cost of revenues | 2,248,253 | 2,941,457 | 4,401,080 | 5,633,942 |
| Selling, administrative, and research and development expenses | 757,871 | 814,962 | 1,519,562 | 1,588,079 |
| Amortization of intangible assets | 51,947 | 42,303 | 102,517 | 82,442 |
| Impairment of goodwill and other intangible assets | 0 | 0 | 89,997 | 1,438 |
| Operating Income | 334,835 | 757,159 | 426,129 | 1,375,790 |
| Interest expense | (43,886) | (36,588) | (75,322) | (74,055) |
| Other income (expense) | (19,839) | 24,294 | (24,180) | 3,161 |
| Income from Continuing Operations Before Income Taxes | 271,110 | 744,865 | 326,627 | 1,304,896 |
| Income Taxes | 92,167 | 216,161 | 155,700 | 380,854 |
| Income from Continuing Operations | 178,943 | 528,704 | 170,927 | 924,042 |
| Loss from Discontinued Operations | (2,378) | (614) | (33,736) | (92,331) |
| Net Income | $176,565 | $528,090 | $137,191 | $831,711 |
| Income Per Share from Continuing Operations, Basic | 0.36 | 1.01 | 0.34 | 1.76 |
| Income Per Share from Continuing Operations, Diluted | 0.36 | 1.01 | 0.34 | 1.75 |
| Loss Per Share from Discontinued Operations, Basic | 0 | 0 | -0.07 | -0.18 |
| Loss Per Share from Discontinued Operations, Diluted | 0 | 0 | -0.07 | -0.18 |
| Net Income Per Share, Basic | 0.35 | 1.01 | 0.27 | 1.59 |
| Net Income Per Share, Diluted | 0.35 | 1.01 | 0.27 | 1.58 |
| Cash Dividend, Paid | 0.31 | 0.28 | 0.62 | 0.56 |
| Cash Dividend, Declared | 0.31 | 0.28 | 0.62 | 0.56 |
| Shares of Common Stock Outstanding, Average | 499,389 | 521,488 | 499,290 | 523,894 |
| Shares of Common Stock Outstanding, Average Assuming Dilution | 500,875 | 525,209 | 500,617 | 527,467 |
| Statement of Financial Position (USD $) | ||
| In Thousands | Jun. 30, 2009
| Dec. 31, 2008
|
| Cash and equivalents | $616,403 | $742,950 |
| Trade receivables | 2,393,176 | 2,571,987 |
| Inventories | 1,438,637 | 1,774,697 |
| Deferred income taxes | 218,125 | 206,496 |
| Prepaid expenses and other current assets | 453,424 | 375,778 |
| Assets held for sale | 12,229 | 82,071 |
| Total current assets | 5,131,994 | 5,753,979 |
| Land | 234,406 | 227,167 |
| Buildings and improvements | 1,520,474 | 1,457,732 |
| Machinery and equipment | 3,904,401 | 3,714,456 |
| Equipment leased to others | 170,422 | 164,504 |
| Construction in progress | 101,285 | 98,876 |
| Gross plant and equipment | 5,930,988 | 5,662,735 |
| Accumulated depreciation | (3,793,006) | (3,553,303) |
| Net plant and equipment | 2,137,982 | 2,109,432 |
| Investments | 450,889 | 465,894 |
| Goodwill | 4,677,193 | 4,517,550 |
| Intangible Assets | 1,696,585 | 1,779,669 |
| Deferred Income Taxes | 82,448 | 75,999 |
| Other Assets | 564,584 | 501,028 |
| Total Assets | 14,741,675 | 15,203,551 |
| Short-term debt | 180,511 | 2,433,973 |
| Accounts payable | 575,001 | 683,991 |
| Accrued expenses | 1,326,115 | 1,315,106 |
| Cash dividends payable | 154,892 | 154,726 |
| Income taxes payable | 206,219 | 216,751 |
| Liabilities held for sale | 5,454 | 20,546 |
| Total current liabilities | 2,448,192 | 4,825,093 |
| Long-term debt | 2,855,812 | 1,247,883 |
| Deferred income tax liabilities | 139,167 | 125,089 |
| Other liabilities | 1,372,380 | 1,330,395 |
| Total noncurrent liabilities | 4,367,359 | 2,703,367 |
| Common stock | 5,323 | 5,318 |
| Additional paid-in-capital | 146,116 | 105,497 |
| Income reinvested in the business | 9,022,927 | 9,196,465 |
| Common stock held in treasury | (1,390,594) | (1,390,594) |
| Accumulated other comprehensive income | 130,361 | (253,211) |
| Noncontrolling interest | 11,991 | 11,616 |
| Total stockholders' equity | 7,926,124 | 7,675,091 |
| Total Liabilities and Stockholders' Equity | $14,741,675 | $15,203,551 |
| Statement of Cash Flows (USD $) | ||
| In Thousands | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
| Net income | $137,191 | $831,711 |
| Depreciation | 182,633 | 189,775 |
| Amortization and impairment of goodwill and other intangible assets | 192,514 | 185,627 |
| Change in deferred income taxes | (11,302) | (24,910) |
| Provision for uncollectible accounts | 6,784 | 4,405 |
| (Gain) loss on sale of plant and equipment | 2,322 | (484) |
| (Income) loss from investments | 13,956 | (19,653) |
| (Gain) loss on sale of operations and affiliates | 29,773 | (97) |
| Stock compensation expense | 23,969 | 21,834 |
| Other non-cash items, net | 27 | (2,365) |
| (Increase) decrease in trade receivables | 322,425 | (213,253) |
| (Increase) decrease in inventories | 428,659 | (98,781) |
| (Increase) decrease in prepaid expenses and other assets | (23,114) | (15,773) |
| Increase (Decrease) in accounts payable | (156,461) | (7,835) |
| Increase (decrease) in accrued expenses and other liabilities | (32,799) | 18,859 |
| Increase (decrease) in income taxes receivable and payable | (56,777) | 72,795 |
| Increase (decrease) in other net | 11,283 | 2,173 |
| Net cash provided by operating activities | 1,071,083 | 944,028 |
| Acquisition of businesses (excluding cash and equivalents) | (113,640) | (678,194) |
| Additions to plant and equipment | (121,338) | (184,987) |
| Purchases of investments | (30,874) | (2,468) |
| Proceeds from Investments | 4,076 | 14,424 |
| Proceeds from sale of plant and equipment | 14,905 | 10,590 |
| Proceeds from sale of operations and affiliates | 15,685 | 1,006 |
| Other | (815) | 851 |
| Net cash used for investing activities | (232,001) | (838,778) |
| Cash dividends paid | (309,507) | (294,806) |
| Issuance of common stock | 15,955 | 35,195 |
| Repurchase of common stock | 0 | (585,574) |
| Net proceeds (repayments) of debt with original maturities 3 months or less | (1,668,982) | 539,314 |
| Proceeds from debt with original maturities greater than 3 months | 2,157,995 | 432 |
| Repayments of debt with original maturities greater than 3 months | (1,258,619) | (4,170) |
| Excess tax benefits from share-based compensation, Financing Activities | 28 | 3,413 |
| Net cash used for financing activities | (1,063,130) | (306,196) |
| Effect of Exchange Rate Changes on Cash and Equivalents | 97,501 | 13,596 |
| Cash and Equivalents, Decrease during the period | (126,547) | (187,350) |
| Cash and Equivalents, Beginning of period | 742,950 | 827,524 |
| Cash and Equivalents, End of period | 616,403 | 640,174 |
| Cash Paid During the Period for Interest | 26,565 | 40,905 |
| Cash Paid During the Period for Income Taxes | 182,850 | 308,190 |
| Liabilities Assumed from Acquisitions | $38,233 | $249,880 |
| Financial Statements | |
| 6 Months Ended
Jun. 30, 2009 | |
| Financial Statements [Abstract] | |
| Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | (1) FINANCIAL STATEMENTS The unaudited financial statements included herein have been prepared by Illinois Tool Works Inc. and Subsidiaries (the Company). In the opinion of management, the interim financial statements reflect all adjustments of a normal recurring nature necessary for a fair statement of the results for interim periods. Events that occurred after June 30, 2009 through the time that these financial statements have been filed on August 7, 2009 with the Securities and Exchange Commission were considered in the preparation of these financial statements. These financial statements should be read in conjunction with the financial statements and notes to financial statements included in the Companys Annual Report on Form 10-K. Certain reclassifications of prior year data have been made to conform with current year reporting. |
| Comprehensive Income | |
| 6 Months Ended
Jun. 30, 2009 | |
| Comprehensive Income Note [Abstract] | |
| Comprehensive Income Note [Text Block] | (2) COMPREHENSIVE INCOME The Companys components of comprehensive income in the periods presented are: (In thousands) Three Months Ended June 30 Six Months Ended June 30 2009 2008 2009 2008 Net income $ 176,565 $ 528,090 $ 137,191 $ 831,711 Other comprehensive income: Foreign currency translation adjustments 504,626 39,400 381,638 141,939 Pension and other postretirement benefit adjustments, net of tax 1,954 (1,169 ) 1,934 (448 ) Comprehensive income $ 683,145 $ 566,321 $ 520,763 $ 973,202 |
| Discontinued Operations | |
| 6 Months Ended
Jun. 30, 2009 | |
| Discontinued Operations [Abstract] | |
| Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | (3) DISCONTINUED OPERATIONS The Company periodically reviews its 895 operations for businesses which may no longer be aligned with its long-term objectives. In August 2008, the Companys Board of Directors authorized the divestiture of the Click Commerce industrial software business which was previously reported in the All Other segment. In the second quarter of 2009, the Company completed the sale of the Click Commerce business. In the fourth quarter of 2007, the Company classified an automotive components business and a consumer packaging business as held for sale. The consumer packaging business was sold in the second quarter of 2008. The Company has sold the automotive components business in the third quarter of 2009. The consolidated statements of income and the notes to financial statements have been restated to present the operating results of the held for sale and divested businesses as discontinued operations. In May 2009, the Companys Board of Directors rescinded a resolution from August 2008 to divest the Decorative Surfaces segment. The consolidated financial statements and related notes for all periods have been restated to present the results related to the Decorative Surfaces segment as continuing operations. Results of the discontinued operations for the second quarter of 2009 and 2008 were as follows: (In thousands) Three Months Ended June 30 Six Months Ended June 30 2009 2008 2009 2008 Operating revenues $ 9,542 $ 37,764 $ 23,169 $ 73,441 Income (loss) before taxes (1,251) 2,270 (35,064) (93,221) Income tax (expense) benefit (1,127) (2,884) 1,328 890 Loss from discontinued operations $ (2,378) $ (614) $ (33,736) $ (92,331) In 2009, the Company recorded a pre-tax loss on the disposal of the Click Commerce business of $29,827,000. Loss before taxes in 2008 includes goodwill impairment charges of $97,152,000 related to the Click Commerce business. As of June 30, 2009, the assets and liabilities of a certain automotive components business were included in assets and liabilities held for sale. As of December 31, 2008, the Company had recorded the assets and liabilities of the Click Commerce business and a certain automotive components business as held for sale. The total assets and liabilities held for sale were as follows: (In thousands) June 30, 2009 December 31, 2008 Trade receivables $ 3,650 $ 18,122 Inventories 1,603 2,369 Net plant and equipment 8,943 11,308 Net goodwill and intangible assets 108,405 Other assets 2,033 5,867 Loss reserve on assets held for sale (4,000 ) (64,000 ) Total assets held for sale $ 12,229 $ 82,071 Accounts payable $ 870 $ 1,119 Accrued expenses 4,584 19,427 Total liabilities held for sale $ |
| Income Taxes | |
| 6 Months Ended
Jun. 30, 2009 | |
| Income Taxes [Abstract] | |
| Income Tax Disclosure [Text Block] | (4) INCOME TAXES In the first half of 2009, the Company incurred significant charges related to the impairment of goodwill and intangible assets of $89,997,000 that were mostly non-deductible, and discrete tax items of $43,540,000 to record reserves on net operating loss carryforwards no longer expected to be utilized and other tax adjustments. The components of the effective tax rate for the six month period ended June 30, 2009 were as follows: Effective tax rate excluding discrete items 28.1 % Discrete tax adjustments 13.4 Goodwill and intangible asset impairment charges 6.2 Effective tax rate 47.7 % In the U.S., the Internal Revenue Service (IRS) has completed its audits for the years 2001-2003 and has proposed several adjustments for which the Company is negotiating a settlement, the most significant of which are related to leveraged leases and mortgage-backed securities. The Company has recorded its best estimate for these exposures. Management believes it is reasonably possible that within the next twelve months the matters presently under consideration for 2001-2003 with the IRS will be resolved and that the amount of the Companys unrecognized tax benefits may decrease by approximately $271 million. |
| Inventories | |
| 6 Months Ended
Jun. 30, 2009 | |
| Inventory Disclosures [Abstract] | |
| Inventory Disclosure [Text Block] | (5) INVENTORIES Inventories at June 30, 2009 and December 31, 2008 were as follows: (In thousands) June 30, 2009 December 31, 2008 Raw material $ 461,914 $ 612,190 Work-in-process 141,844 174,607 Finished goods 834,879 987,900 $ 1,438,637 $ 1,774,697 |
| Goodwill and Intangible Assets | |
| 6 Months Ended
Jun. 30, 2009 | |
| Goodwill And Intangible Assets [Abstract] | |
| Goodwill and Intangible Assets Disclosure [Text Block] | (6) GOODWILL AND INTANGIBLE ASSETS Goodwill represents the excess cost over fair value of the net assets of purchased businesses. The Company does not amortize goodwill and intangible assets that have indefinite lives. In the first quarter of each year, the Company performs an annual impairment assessment of goodwill and intangible assets with indefinite lives based on the fair value of the related reporting unit or intangible asset. In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS 157). The Company adopted the provisions of SFAS 157 on January 1, 2009 for all nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value on a nonrecurring basis. SFAS 157 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants and provides guidance for measuring fair value and the necessary disclosures. When performing its annual goodwill impairment assessment, the Company compares the estimated fair value of each of its 63 reporting units to the carrying value. Fair values are determined primarily by discounting estimated future cash flows based either on current operating cash flows or on a detailed cash flow forecast prepared by the relevant reporting unit. The Company also considers additional valuation techniques, such as market multiples from similar transactions and quoted market prices of relevant public companies. If the fair value of a reporting unit is less than its carrying value, an impairment loss, if any, is recorded for the difference between the implied fair value and the carrying value of the reporting units goodwill. The Companys indefinite-lived intangibles consist of trademarks and brands. The fair values of these intangibles are determined based on a relief-of-royalty income approach derived from internally forecasted revenues of the related products. If the fair value of the trademark or brand is less than its carrying value, an impairment loss is recorded for the difference between the estimated fair value and carrying value of the intangible. In the first quarter of 2009, the Company performed its annual impairment testing of its goodwill and intangible assets with indefinite lives in compliance with the newly adopted provisions of SFAS 157 which resulted in goodwill impairment charges of $60,000,000 related to the pressure sensitive adhesive reporting unit in the Polymers Fluids segment and $18,000,000 related to the PC board fabrication reporting unit in the Power Systems Electronics segment. The goodwill impairments were related to new reporting units which were acquired over the last few years. These charges were driven by lower than expected forecasts compared to results expected when the reporting units were acquired. Also in the first quarter 2009, intangible asset impairments of $11,997,000 were recorded to reduce to the estimated fair value the carrying value of trademarks and brands with indefinite lives. Approximately $5,800,000 of this charge related to the |
| Retirement Plans And Post Retirement Benefits | |
| 6 Months Ended
Jun. 30, 2009 | |
| Retirement Plans And Post Retirement Benefits [Abstract] | |
| Pension and Other Postretirement Benefits Disclosure [Text Block] | (7) RETIREMENT PLANS AND POSTRETIREMENT BENEFITS Pension and other postretirement benefit costs for the periods ended June 30, 2009 and 2008 were as follows: (In thousands) Three Months Ended June 30 Six Months Ended June 30 Pension Other Postretirement Benefits Pension Other Postretirement Benefits 2009 2008 2009 2008 2009 2008 2009 2008 Components of net periodic benefit cost: Service cost $ 24,201 $ 28,060 $ 3,142 $ 3,585 $ 48,433 $ 56,009 $ 6,284 $ 7,170 Interest cost 29,350 30,223 7,718 8,217 58,930 60,319 15,436 16,433 Expected return on plan assets (38,040 ) (42,283 ) (3,403 ) (3,848 ) (75,885 ) (84,536 ) (6,806 ) (7,696 ) Amortization of actuarial (gain) loss 2,072 651 64 (252 ) 4,137 1,289 128 (504 ) Amortization of prior service (income) cost (422 ) (600 ) 1,606 1,565 (800 ) (1,202 ) 3,212 3,130 Amortization of net transition amount 37 24 76 45 Curtailment settlement gain (12,345 ) (1,929) (12,345 ) (1,929) Net periodic benefit cost $ 4,853 $ 16,075 $ 9,127 $ 7,338 $ 22,546 $ 31,924 $ 18,254 $ 16,604 The Company expects to contribute $218,400,000 to its pension plans and $38,100,000 to its other postretirement plans in 2009. As of June 30, 2009, contributions of $41,100,000 to pension plans and $17,300,000 to other postretirement plans have been made. |
| Short Term Debt | |
| 6 Months Ended
Jun. 30, 2009 | |
| Short Term Debt [Abstract] | |
| Short-term Debt [Text Block] | (8) SHORT-TERM DEBT In June 2008, the Company entered into a $1,500,000,000 Line of Credit Agreement with a termination date of June 12, 2009. In October 2008, the Company amended the Line of Credit Agreement in order to increase the line of credit to $2,500,000,000. This line of credit was replaced on June 12, 2009 by a $2,000,000,000 Line of Credit Agreement with a termination date of June 11, 2010. No amounts were outstanding under this facility at June 30, 2009. The Company had outstanding commercial paper of $121,997,000 at June 30, 2009 and $1,820,423,000 at December 31, 2008. In 1999, the Company issued $500,000,000 of 5.75% redeemable notes due March 1, 2009. The balance related to these notes was repaid at maturity. |
| Long Term Debt | |
| 6 Months Ended
Jun. 30, 2009 | |
| Long-term Debt, Unclassified [Abstract] | |
| Long-term Debt [Text Block] | (9) LONG-TERM DEBT On March 23, 2009, the Company issued $800,000,000 of 5.15% redeemable notes due April 1, 2014 at 99.92% of face value and $700,000,000 of 6.25% redeemable notes due April 1, 2019 at 99.984% of face value. The effective interest rates of the notes are 5.2% and 6.3%, respectively. The approximate fair value based on rates for comparable instruments and related carrying value of the Companys long-term debt, including current maturities was as follows: (In thousands) June 30, 2009 December 31, 2008 Fair value $ 2,845,031 $ 1,682,304 Carrying value 2,864,070 1,757,807 |
| Stockholders Equity | |
| 1/1/2009 - 6/30/2009
| |
| Stockholders' Equity Note [Abstract] | |
| Stockholders' Equity Note Disclosure [Text Block] | (10) STOCKHOLDERS' EQUITY On January 1, 2009, the Company adopted Statement of Financial Accounting Standards No. 160, Noncontrolling Interests in Consolidated Financial Statements. Upon adoption the Company reclassified the December 31, 2008 balance of $11,616,000 from other noncurrent liabilities to noncontrolling interest in stockholders equity. |
| Segment Information | |
| 6 Months Ended
Jun. 30, 2009 | |
| Segment Information [Abstract] | |
| Segment Reporting Disclosure [Text Block] | (11) SEGMENT INFORMATION See Managements Discussion and Analysis for information regarding operating revenues and operating income for the Companys segments. |
