Compressed Air Best Practices - February 2009 - (Page 48)

| 02/09 Compressed Air Industry POWER PLANTS | WALL STREET WATCH “Projected fourth-quarter proforma revenues are expected to decrease by 11% compared with 2007, to $3.7 billion, which is approximately 10% below our initial forecast of $4.1 billion and includes approximately two percentage points of negative impact from currency translation. Lower volume, unfavorable mix, and several one-time cost items are negatively impacting operating earnings for the quarter. Additionally, the increased value of the dollar is expected to negatively impact earnings by approximately $0.15 per share compared with our prior forecast for the quarter. “We have accelerated our previously announced productivity actions for the balance of the year and for 2009 to deal with the slowing environment while continuing to build a strong business for the future. We are realizing the synergies from the recent acquisition of Trane and from our initiatives in purchasing and Lean Six Sigma, which will produce even greater benefits in 2009. We expect the Trane acquisition synergies to exceed $75 million in 2008 and we are on track to realize an additional $125 million in 2009. We are also targeting to capture significant material cost reductions in 2009 from the recent sharp declines in key commodities. “During the fourth quarter we initiated corporate-wide restructuring actions that we announced in October to streamline our manufacturing footprint and general and administrative cost base. The majority of these costs will be incurred in 2008 and are expected to total approximately $110 million. These actions are expected to generate $100 million of annual pre-tax savings in 2009 and over $110 million in 2010. We have accelerated the timing of the restructuring and are developing additional cost reduction actions to offset declining end markets. “We continue to generate positive cash flow and we have sustained access to the commercial paper markets. Since the acquisition of Trane in June, we have paid down approximately $600 million of debt. We have significant available liquidity with $3 billion of credit facilities, as well as additional opportunities to access the cash on our balance sheet, expand our receivable securitization program and improve our working capital management. “Additionally, the company is currently conducting its annual impairment test of goodwill and intangible assets which, because of the company’s recent low stock price, could result in a noncash impairment charge in the fourth quarter. Any potential impairment charge will not impact our existing debt covenants or our borrowing capacity under current credit arrangements. Our long-term business fundamentals remain solid and we are working to ensure that Ingersoll-Rand will emerge from this economic slowdown as a stronger, more efficient company,” said Henkel. NEW YORK, Dec. 11, 2008 — United Technologies Corp. (NYSE: UTX) President and CEO Louis R. Chênevert affirmed the company’s expectation for 2008 earnings per share growth of 15%, or $4.90 per share. Chênevert also projected 2009 earnings per share of $4.65 to $5.15, a range of plus or minus 5%. The company anticipates 2008 cash flow from operations less capital expenditures in the range of net income. “Continued. strength in our aerospace and defense, industrial filtration and gas turbine businesses helped to offset weakness in our other end markets.” — Bill Cook, CEO, Donaldson 48 www.airbestpractices.com http://www.airbestpractices.com

Table of Contents Feed for the Digital Edition of Compressed Air Best Practices - February 2009

Compressed Air Best Practices - February 2009 Contents From the Editor Utility-Air News Compressed Air Audit of the Month Air Standards Instrument Air in Nuclear Power Plants Seven Sustainability Projects for Industrial Energy Savings The Pneumatic Advantage Personal Productivity Resources for Energy Engineers Wall Street Watch Advertiser Index Classifieds

Compressed Air Best Practices - February 2009

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