Challenging marine market conditions impact ITT

WHITE PLAINS, N.Y. – The Motion & Flow Control segment of ITT Corp.’s (NYSE: ITT) business experienced a 12 percent decline in fourth quarter revenue to $327 million, compared to the same period of the prior year, it reported in a recent statement.

Organic revenue declined nine percent with challenging conditions in many of the segment’s end markets including marine and automotive, according to the company. The segment reported a fourth quarter operating loss of $4 million, as lower volume, restructuring activity and costs associated with business dispositions during the quarter significantly offset productivity improvements and favorable foreign currency exchange, ITT stated.

Full-year 2008 revenue for the segment was $1.6 billion, up 19 percent over 2007. For the year, operating income grew two percent on a comparable basis to $192 million.

Overall revenue breaks record

ITT’s total 2008 fourth quarter revenue was $2.9 billion and income from continuing operations was $176 million. Excluding special items, income from continuing operations for the quarter was $149 million as benefits from recent acquisitions and operational improvements offset higher costs from aggressive restructuring and realignment activities, according to the company.

For the full-year 2008, ITT reported record revenues of $11.7 billion and income from continuing operations of $775 million. Excluding special items, income rose to $741 million, representing 23 percent earnings growth year-over-year. Free cash flow, representing cash from operations less capital expenditures, for the year topped $871 million, a 112-percent conversion of income from continuing operations.

“Despite a global economic environment that deteriorated as the year progressed, our business continued to perform on the strength of a well-balanced portfolio and teams that met the adversity in their markets head on,” said Steve Loranger, ITT’s chairman, president and chief executive officer. “And while we expect 2009 to be more difficult, we take great pride in having achieved another record year of revenue and earnings growth in 2008.”

Loranger added, “We are maintaining our previous 2009 earnings guidance. While the challenges that lie ahead are significant, we believe our leaders are taking the necessary actions to best position the company for these difficult times. And while we’ve made some tough choices in recent months to manage costs aggressively, we remain committed to our long-term strategies and will continue to invest in our future success.”

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