At ITT, we have a clear vision of where the world’s key industries are heading and how we can help them get there. Over the past two years, we have built on that expertise by establishing our foundation as a focused multi-industrial company while further developing the capabilities that will help us continue to solve our customers’ most critical problems.
Financial Highlights
At ITT, we have a clear vision of where the world’s key industries are heading and how we can help them get there. Over the past two years, we have built on that expertise by establishing our foundation as a focused multi-industrial company while further developing the capabilities that will help us continue to solve our customers’ most critical problems.
Today, we are a leading manufacturer of highly engineered, critical components and customized technology solutions for the energy, transportation and industrial markets. Our portfolio has strength and durability, balance and diversity. Our businesses are aligned with global growth drivers – urbanization, a growing middle class and sustainable development – and our products provide solutions for customers in key end markets that underpin our modern way of life.
Our work is made possible by the talent and innovative thinking of our more than 9,400 committed employees in more than 35 countries. Together, they serve customers in well over 100 countries and are outstanding ambassadors for our long-standing brands – including Goulds pumps, Cannon connectors, KONI shock absorbers and Enidine energy absorption components, to name a few – that are recognized and trusted globally.
Thanks to the contributions of our people, ITT generated great results in 2013 and positioned our company for further growth and success in the years ahead. We’re making the right moves today and investing in the capabilities to ensure the ITT legacy extends and expands far into the future.
12%
2013 total
revenue growth
18%
2013 emerging market revenue growth
21%*
2013 adjusted segment operating income growth
20%*
2013 adjusted
EPS growth
End Markets
Geography
Business Mix
Charts represent 2013 revenue profile.
*For a reconciliation of non-GAAP to GAAP results, please see our website at itt.com/investors.
Dear Shareowners, Employees, Customers and Friends,
In life and in business, progress is often achieved not by the great leap or enormous stride but by steady steps in the right direction that reflect a day-to-day commitment and investment in one’s success.
Over the past two years, ITT has embraced that approach by consistently investing for growth while delivering a solid track record of premier performance and results. Our 2013 full-year results are the latest reflection of our success, with total revenue up 12 percent to $2.5 billion and organic revenue up 6 percent, adjusted earnings per share from continuing operations up 20 percent to $2.02 and adjusted segment operating income up 21 percent.
These are outstanding results and reflect the commitment and winning spirit of our more than 9,400 employees around the world. However, while we are all pleased with our progress, we’re also continually envisioning what’s ahead. Each day our employees invest themselves in finding new ways of solving complex problems, leveraging technology and working smarter to serve our customers in the energy, transportation and industrial markets.
In 2013, that forward thinking contributed to our results and will continue to create value and growth for years to come. Our focus has been and will remain on opportunities to expand in key markets, provide a premier customer experience, drive operational excellence and deploy capital effectively.
- We have furthered the ability of our teams to serve the oil and gas industry in key markets such as Asia and North America by enhancing our research, development and production capabilities for our pump facilities.
- We are driving our ability to better meet the needs of our customers in the world’s largest automobile market by expanding our brake pad production and research and development facilities in China.
- In every corner of the organization, we are embracing Lean practices that are making our operations more streamlined and ensuring that every system, process, program and activity helps us deliver a premier customer experience. Thanks to our commitment to Lean and our focus on operational excellence, we delivered a second year of more than $100 million in gross productivity savings.
- We are helping ensure our people have the skills and resources to meet evolving customer needs through enhancing our talent management processes and supporting programs to engage employees in building a high-performing, rewarding culture that retains and attracts world-class talent.
This isn’t all we accomplished in 2013 but it represents the strong foundation we have in place and our commitment to driving profitable growth and value creation. This commitment is also reflected in our five-year strategy, which sets forth how our unique market positions and capabilities will drive our winning aspirations in the years ahead.
Oliver Wendell Holmes once said, "The great thing in the world is not so much where we stand as in what direction we are moving." When I look ahead, I could not be more excited to be part of this company at this moment. At ITT, we are on our way to achieving the characteristics of all great growth companies – from premier financial performance, to market differentiation and customer focus, to a winning culture and best-in-class talent and capabilities.
We are invested in our future and dreaming big for the benefit of ITT shareowners, customers and employees.
We look forward to making this journey with each of you.
Sincerely,
Denise L. Ramos
Chief Executive Officer and President
The team behind our Goulds XHD Slurry Pump, which was named a Breakthrough Product of the Year, represents ITT’s commitment to innovation and new product development.
Invested
Two years ago, ITT took one of its first steps as a focused multi-industrial company by developing and deploying The ITT Way, a strategic roadmap that galvanized our people around our company’s uniqueness, the relatedness across our businesses and how we differentiate ourselves in the marketplace.
In 2013, we continued our journey by building on that foundation and enhancing our strategic framework to focus even more sharply on creating premium solutions, delivering a premier customer experience and operating in the most efficient and effective way possible. Inherent in our approach was the importance of both investing in the business and delivering financial performance at the same time.
Today, we see exactly where we want to go, and across the company we are all invested in bringing our strategy to life and becoming a business that makes an enduring impact on the markets we serve and creates sustainable value for our stakeholders.
Our Winning Aspiration
We solve critical problems.
At ITT, our customers in the energy, transportation and industrial markets depend on us to solve their most critical problems, and we focus on partnering with them to find solutions to their unique challenges. We not only apply our unique engineering and technology capabilities, we also leverage our flexible and efficient manufacturing to meet our customers’ requirements. Whether it’s the need for sophisticated pumping equipment, a smarter brake pad or lighter-weight aerospace components, ITT’s innovative thinkers have the answer.
We create highly engineered solutions. Our commitment to creating highly engineered, customized solutions is demonstrated by our continuing investment in research and development, where we have consistently maintained above-peer investment levels at nearly 3 percent of revenue. In 2013 that commitment was reflected by our investment to expand our global capabilities for the automotive and oil and gas markets. Building on this success, we plan to further increase our spending on R&D in 2014.
We build partnerships. Given the nature of our products and services, we have long-term relationships with customers that endure through the life of their ITT products, and customers know they can rely on us for valued service and replacement parts long after the initial sale. An important part of this equation is our talented people, who provide vital insight and collaboration on some of the most sophisticated and demanding assignments. From laboratories to the field, we are an integral part of our customers’ businesses, working side-by-side with them – not as providers, but as partners.
We create enduring impact. At ITT, we design and manufacture sophisticated components for key industries that support the global macro trends that are defining our future, including an expanding middle class, urbanization and sustainable development. Our products and solutions – from our advanced pumps and brake pads to our harsh-environment connectors and innovative energy absorption devices – are often invisible because they are part of larger machines and manufacturing processes. However, they make an invaluable contribution to our modern way of life and drive our ability to create enduring impact for our stakeholders around the world.
Where We Play
We have aligned our portfolio so that it is balanced across select markets, geographies and customer segments. We have long held niche positions in key markets such as energy, transportation and industrial, and we will continue to grow with these customers. We are also well-aligned with global growth trends, and we’re building on our global footprint and strong emerging market presence. In addition, we are continually enhancing our aftermarket capabilities, which currently drive about 30 percent of our revenue, to ensure that we excel in meeting our customers’ service and maintenance requirements while supporting the latest platforms among original equipment manufacturers.
Our Control Technologies team in Valencia, Calif., makes a wide variety of highly engineered components for the aerospace and defense markets.
How We Win
Our competitive advantage comes through providing differentiating value for customers through a premier customer experience, defined by a broad portfolio of products and services, combined with quality, delivery, responsiveness, speed and service.
Our advantage also comes through providing optimized custom solutions by partnering with customers to find cost-effective answers to their unique challenges and leveraging our engineering and technology capabilities and our flexible and efficient manufacturing.
Most important, we win through the efforts of our more than 9,400 engaged employees around the world who are helping us build a healthy, high-performing culture that supports our growth and our future.
All of these competitive advantages are being supported by our commitment to Lean, which will enable us to provide an enhanced experience to all of our customers by improving quality, speed, agility, service and value.
ITT Locations
Industrial Process
Seneca Falls, NY • 3,470 employees
Pumps, valves, monitoring and control systems, water treatment and aftermarket services for the oil and gas, chemical, mining, pulp and paper, power and biopharmaceutical markets
- Amory, Mississippi
- Baroda, India
- Cheongwon, South Korea
- Choongbuk, South Korea
- City of Industry, California
- Dammam, Saudi Arabia
- Lancaster, Pennsylvania
- Obernkirchen, Germany
- Wangara, Australia
- Salto, Brazil
- Shanghai, China
- Southaven, Mississippi
- Tizayuca, Mexico
Global Service Capabilities
Interconnect Solutions
Santa Ana, CA • 2,230 employees
Connectors and interconnects for the oil and gas, medical, industrial and transportation, and aerospace and defense markets
- Basingstoke, England
- Lainate, Italy
- Nogales, Mexico
- Santa Rosa, California
- Shenzhen, China
- Weinstadt, Germany
ITT World Headquarters
White Plains, NY
ITT has more than 155 locations globally representing manufacturing, office and sales, and global service facilities, including the identified locations by segment.
Control Technologies
Valencia, CA • 970 employees
Highly engineered motion control and vibration isolation products and solutions for the industrial, aerospace and defense markets
- Billerica, Massachusetts
- Orchard Park, New York
- Westminster, South Carolina
- Wuxi, China
Motion Technologies
Lainate, Italy • 2,455 employees
Shock absorbers, brake pads and friction materials for the automotive and rail markets
- Barge, Italy
- Termoli, Italy
- Hebron, Kentucky
- Kelsterbach, Germany
- Novi, Michigan
- Ostrava, Czech Republic
- Oud-Beijerland, Netherlands
- Vauda Canavese, Italy
- Wuxi, China
ITT Board of Directors
Frank T. MacInnis
Chairman of the ITT Board of Directors and Former Chairman and Chief Executive Officer, EMCOR Group, Inc.
Denise L. Ramos
Chief Executive Officer and President
Orlando D. Ashford
President, Talent, Marsh & McLennan Cos.
G. Peter D’Aloia
Former Senior Vice President and Chief Financial Officer,
American Standard Companies, Inc.
Donald DeFosset, Jr.
Former Chairman, Chief Executive Officer and
President, Walter Industries, Inc.
Christina A. Gold
Former Chief Executive Officer, President and
Director, The Western Union Company, Inc.
Richard P. Lavin
Chief Executive Officer and President,
Commercial Vehicle Group, Inc.
Rebecca A. McDonald
Former Chief Executive Officer, Laurus Energy, Inc.
Donald J. Stebbins
Former Chairman, Chief Executive Officer and
President, Visteon Corp.
ITT Leadership Team
Denise L. Ramos
Chief Executive Officer and President
Aris C. Chicles
Executive Vice President
Mary Beth Gustafsson
Senior Vice President and General Counsel
Munish Nanda
Senior Vice President and President, Control Technologies
Robert J. Pagano, Jr.
Senior Vice President and President, Industrial Process
Luca Savi
Senior Vice President and President, Motion Technologies
Thomas M. Scalera
Senior Vice President and Chief Financial Officer
Neil W. Yeargin
Senior Vice President and President, Interconnect Solutions