8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): April 18, 2005

PARKER-HANNIFIN CORPORATION

(Exact Name of Registrant as Specified in Charter)

Ohio	1-4982	34-0451060
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

6035 Parkland Blvd. Cleveland, Ohio	44124-4141
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (216) 896-3000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

Item 7.01 Regulation FD Disclosure

The following information is furnished pursuant to Item 2.02, “Results of Operations and Financial Condition” and Item 7.01, “Regulation FD Disclosure”

On April 18, 2005, Parker-Hannifin Corporation issued a press release and presented a Webcast announcing earnings for the quarter ended March 31, 2005. A copy of the press release is filed as Exhibit 99.1 to this report. A copy of the Webcast presentation is filed as Exhibit 99.2 to this report.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits:

99.1	Press release issued by Parker-Hannifin Corporation, dated April 18, 2005.
99.2	Webcast presentation by Parker-Hannifin Corporation, dated April 18, 2005.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

PARKER-HANNIFIN CORPORATION
By:	/s/ Timothy K. Pistell
	Timothy K. Pistell Vice President Finance and Administration and Chief Financial Officer

Date: April 18, 2005

EX-99.1

Exhibit 99.1

For Release:	Immediately
Contact:	Media –
	Jennifer Eaton - Corp. Communications jeaton@parker.com	216/896-2895	After hours: 216/407-6165
	Financial Analysts –
	Pamela Huggins, VP & Treasurer phuggins@parker.com	216/896-2240
Stock Symbol:	PH - NYSE

PARKER HANNIFIN ANNOUNCES RECORD THIRD QUARTER SALES; EARNINGS FROM CONTINUING OPERATIONS OF $1.18 PER SHARE

Cleveland, Ohio: April 18, 2005 – Parker Hannifin Corporation (NYSE: PH) today reported fiscal third-quarter income from continuing operations of $142.2 million, or $1.18 per diluted share on sales of $2.14 billion for the period ended March 31, 2005, compared to income from continuing operations of $105.7 million, or 88 cents per diluted share on sales of $1.88 billion in the same period last year. In the current quarter, the company recorded a charge from discontinued operations of $2.8 million, or three cents per diluted share. The charge reflects the ongoing accounting for the sale of the company’s Wynn Oil specialty chemicals business in December 2004.

As previously announced, in the quarter the company recorded six cents per diluted share related to realignment costs, divestiture activities, and tax-related professional fees; and a tax benefit of 10 cents per diluted share.

“We are pleased to report record third quarter sales up 14 percent and strong earnings per share from continuing operations up 34 percent year-over-year. We continue to generate strong cash flow from operations at $517 million for the first nine months of fiscal 2005, up four percent from the same period last year,” said Parker Chairman and CEO Don Washkewicz. “Our third quarter performance is primarily the result of our employees’ ongoing execution of our Win Strategy, including the recent acquisition of Sporlan and Acadia, which should continue to help Parker reduce future revenue volatility.”

Third Quarter Segment Results

In the North American Industrial segment, operating income improved 36 percent to $120.1 million on sales of $925.0 million. The segment benefited from strong demand in the oil and gas, mining, construction, and heavy-duty truck markets.

International Industrial units increased operating income 47 percent to $63.1 million on sales of $623.3 million. The improvements in this segment were largely the result of implementing the company’s Win Strategy initiatives.

1

In the company’s Climate & Industrial Controls segment, third-quarter operating income increased 24 percent to $26.5 million on sales of $226.8 million. Despite a softening in the automotive market, the business is benefiting from the successful integration of the Sporlan acquisition and the expected seasonal ramp up in the air conditioning and refrigeration markets.

Aerospace reported an increase in operating income of six percent to $44.0 million on sales of $337.3 million, reflecting increased commercial OEM business.

In the “Other” segment, comprised of Astron metal buildings, operating income was $2.4 million on sales of $29.2 million.

Year-to-Date Results

For the first nine months of fiscal 2005, the company’s income from continuing operations increased 81 percent to $386.6 million, or $3.21 per diluted share on sales of $6.0 billion. Income from continuing operations for the first nine months of last year was $213.6 million, or $1.80 cents per diluted share on sales of $5.03 billion. Income from discontinued operations for the first nine months of fiscal 2005 was $56.7 million, or 47 cents per diluted share, which includes profit from operations and the gain on the divestiture of the Wynn Oil specialty chemicals business.

Cash Flow and Inventories

For the first nine months, cash flow from operations was $516.7 million, or 8.6 percent of sales. For the same period last year, cash flow from operations was $495.0 million, or 9.8 percent of sales.

During the quarter, inventories were reduced by $48 million, which includes the effects of currency and acquisitions, and the company’s ongoing lean manufacturing efforts.

Outlook

The company raised fiscal 2005 full-year earnings estimates to be between $4.72 and $4.92 per diluted share, which includes 47 cents per diluted share from discontinued operations.

“We are on target to achieve record sales and earnings in fiscal 2005,” added Washkewicz. “While we have a few markets experiencing some softness, we are very encouraged by the continued strength in our industrial and aerospace markets.

“Our Win Strategy is a multi-faceted approach for capturing and focusing the creativity of our entire global

2

organization. We are especially pleased with our success in expanding our business into high growth regions, as evidenced by our most recent announcement of entering into a joint venture with Tianjin Tejing Hydraulics Company to produce hydraulic systems in China.”

NOTICE OF CONFERENCE CALL: Parker Hannifin’s conference call and slide presentation to discuss its fiscal third-quarter results is available to all interested parties via live webcast today at 10:00 a.m. ET, on the company’s investor information web site, www.phstock.com. To access the call, click on the “Live Webcast” link. From this link, users also may complete a pre-call system test and register for e-mail notification of future events and information available from Parker.

With annual sales approaching $8 billion, Parker Hannifin is the world’s leading diversified manufacturer of motion and control technologies and systems, providing precision-engineered solutions for a wide variety of commercial, mobile, industrial and aerospace markets. The company employs more than 48,000 people in 46 countries around the world. Parker has increased its annual dividends paid to shareholders for 48 consecutive years, among the top five longest-running dividend-increase records in the S&P 500 index. For more information, visit the company’s web site at www.parker.com, or its investor information site at www.phstock.com.

Forward-Looking Statements:

Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. All statements regarding future performance, earnings projections, events or developments are forward-looking statements. It is possible that the future performance and earnings projections of the company and individual segments may differ materially from current expectations, depending on economic conditions within both its industrial and aerospace markets, and the company’s ability to achieve anticipated benefits associated with announced realignment activities, strategic initiatives to improve operating margins, and growth initiatives. A change in economic conditions in individual markets may have a particularly volatile effect on segment results. Among the other factors which may affect future performance are: changes in business relationships with and purchases by or from major customers or suppliers, including delays or cancellations in shipments; uncertainties surrounding timing, successful completion or integration of acquisitions; threats associated with and efforts to combat terrorism; competitive market conditions and resulting effects on sales and pricing; increases in raw-material costs that cannot be recovered in product pricing; the company’s ability to manage costs related to employee retirement and health care benefits and insurance; and global economic factors, including currency exchange rates, difficulties entering new markets and general economic conditions such as inflation and interest rates. The company makes these statements as of the date of this disclosure, and undertakes no obligation to update them.

#            #            #

3

PARKER HANNIFIN CORPORATION - MARCH 31, 2005

CONSOLIDATED STATEMENT OF INCOME

(Unaudited)	Three Months Ended March 31,						Nine months ended March 31,
(Dollars in thousands except per share amounts)	2005			2004			2005			2004
Net sales	$	2,141,708		$	1,879,057		$	6,004,563		$	5,034,502
Cost of sales		1,712,884			1,526,297			4,769,640			4,122,981
Gross profit		428,824			352,760			1,234,923			911,521
Selling, general and administrative expenses		218,207			195,452			636,187			553,893
Other income (deductions):
Interest expense		(17,116	)		(17,229	)		(50,620	)		(56,247	)
Interest and other (expense), net		(1,872	)		(792	)		(11,101	)		(3,188	)
		(18,988	)		(18,021	)		(61,721	)		(59,435	)
Income from continuing operations before income taxes		191,629			139,287			537,015			298,193
Income taxes		49,454			33,547			150,454			84,572
Income from continuing operations		142,175			105,740			386,561			213,621
Discontinued operations		(2,805	)		2,108			56,719			6,689
Net income	$	139,370		$	107,848		$	443,280		$	220,310
Earnings (loss) per share:
Basic earnings per share from continuing operations	$	1.19		$	.89		$	3.25		$	1.82
Discontinued operations		(.02	)		.02			.48			.05
Basic earnings per share	$	1.17		$	.91		$	3.73		$	1.87
Diluted earnings per share from continuing operations	$	1.18		$	.88		$	3.21		$	1.80
Discontinued operations		(.03	)		.02			.47			.05
Diluted earnings per share	$	1.15		$	.90		$	3.68		$	1.85
Average shares outstanding during period - Basic		119,173,986			118,242,311			118,787,238			117,545,386
Average shares outstanding during period - Diluted		120,769,762			119,637,727			120,534,917			118,803,626
Cash dividends per common share	$	.20		$	.19		$	.58		$	.57

Note: Certain prior period amounts have been reclassified to conform to the current year presentation.

BUSINESS SEGMENT INFORMATION BY INDUSTRY

(Unaudited)	Three Months Ended March 31,					Nine months ended March 31,
(Dollars in thousands)	2005		2004			2005		2004
Net sales
Industrial:
North America	$	924,975	$	815,239		$	2,576,556	$	2,168,428
International		623,343		541,634			1,755,537		1,404,903
Aerospace		337,314		314,651			995,409		889,074
Climate & Industrial Controls		226,831		181,172			568,807		481,820
Other		29,245		26,361			108,254		90,277
Total	$	2,141,708	$	1,879,057		$	6,004,563	$	5,034,502
Segment operating income
Industrial:
North America	$	120,133	$	88,605		$	339,804	$	180,487
International		63,079		42,857			191,167		103,808
Aerospace		43,945		41,638			144,779		113,960
Climate & Industrial Controls		26,513		21,432			51,241		49,405
Other		2,379		(409	)		13,896		2,749
Total segment operating income	$	256,049	$	194,123		$	740,887	$	450,409
Corporate general and administrative expenses		23,447		25,435			79,418		73,441
Income from continuing operations before interest expense and other		232,602		168,688			661,469		376,968
Interest expense		17,116		17,229			50,620		56,247
Other expense		23,857		12,172			73,834		22,528
Income from continuing operations before income taxes	$	191,629	$	139,287		$	537,015	$	298,193

Note: Certain prior period amounts have been reclassified to conform to the current year presentation.

CONSOLIDATED BALANCE SHEET

(Unaudited) (Dollars in thousands)	March 31,
	2005		2004
Assets
Current assets:
Cash and cash equivalents	$	104,284	$	169,956
Accounts receivable, net		1,283,675		1,163,145
Inventories		1,072,248		970,880
Prepaid expenses		42,466		36,952
Deferred income taxes		108,384		107,000
Total current assets		2,611,057		2,447,933
Plant and equipment, net		1,620,928		1,622,954
Goodwill		1,481,185		1,218,130
Intangible assets, net		199,349		58,458
Other assets		842,906		808,966
Net assets of discontinued operations				53,921
Total assets	$	6,755,425	$	6,210,362
Liabilities and shareholders’ equity
Current liabilities:
Notes payable	$	18,098	$	165,448
Accounts payable		533,674		493,454
Accrued liabilities		567,932		515,526
Accrued domestic and foreign taxes		123,518		137,528
Total current liabilities		1,243,222		1,311,956
Long-term debt		966,814		968,326
Pensions and other postretirement benefits		825,045		955,201
Deferred income taxes		75,911		21,579
Other liabilities		183,382		162,636
Shareholders’ equity		3,461,051		2,790,664
Total liabilities and shareholders’ equity	$	6,755,425	$	6,210,362

Note: Certain prior period amounts have been reclassified to conform to the current year presentation.

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)	Nine months ended March 31,
(Dollars in thousands)	2005			2004
Cash flows from operating activities:
Net income	$	443,280		$	220,310
Net (income) from discontinued operations		(56,719	)		(6,689	)
Depreciation and amortization		197,284			188,876
Net change in receivables, inventories, and trade payables		(63,218	)		23,760
Net change in other assets and liabilities		(2,024	)		98,856
Other, net		(1,942	)		(30,114	)
Net cash provided by operating activities		516,661			494,999
Cash flows from investing activities:
Acquisitions (net of cash of $4,653 in 2005 and $63,054 in 2004)		(530,901	)		(201,101	)
Capital expenditures		(112,978	)		(101,715	)
Proceeds from sale of business		120,000			—
Other, net		27,476			27,134
Net cash (used in) investing activities		(496,403	)		(275,682	)
Cash flows from financing activities:
Net proceeds from common share activity		5,946			42,443
Net proceeds (payments of) debt		(21,175	)		(277,865	)
Dividends		(68,880	)		(66,845	)
Net cash (used in) financing activities		(84,109	)		(302,267	)
Net cash (used in) provided by discontinued operations		(19,004	)		8,735
Effect of exchange rate changes on cash		3,292			(1,679	)
Net (decrease) in cash and cash equivalents		(79,563	)		(75,894	)
Cash and cash equivalents at beginning of period		183,847			245,850
Cash and cash equivalents at end of period	$	104,284		$	169,956

Note: Certain prior period amounts have been reclassified to conform to the current year presentation.

EX-99.2

Exhibit 99.2

PH

LISTED

NYSE®

Parker Hannifin Corporation

Quarterly Earnings Release 3rd Quarter FY 2005

April 18, 2005

Forward Looking Statements

Forward-Looking Statements:

Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. All statements regarding future performance, earnings projections, events or developments are forward-looking statements. It is possible that the future performance and earnings projections of the company and individual segments may differ materially from current expectations, depending on economic conditions within both its industrial and aerospace markets, and the company’s ability to achieve anticipated benefits associated with announced realignment activities, strategic initiatives to improve operating margins, and growth initiatives. A change in economic conditions in individual markets may have a particularly volatile effect on segment projections. Among the other factors which may affect future performance are: changes in business relationships with and purchases by or from major customers or suppliers, including delays or cancellations in shipments; uncertainties surrounding timing, successful completion or integration of acquisitions; threats associated with and efforts to combat terrorism; competitive market conditions and resulting effects on sales and pricing; increases in raw-material costs that cannot be recovered in product pricing; the company’s ability to manage cost related to employee retirement and healthcare benefits and insurance; and global economic factors, including currency exchange rates, difficulties entering new markets and general economic conditions such as inflation and interest rates. The company makes these statements as of the date of this disclosure, and undertakes no obligation to update them.

Non-GAAP Financial Measure

This presentation reconciles sales amounts reported in accordance with U.S. GAAP to sales amounts adjusted to remove the effects of acquisitions and divestitures made within the prior four quarters as well as the effects of currency exchange rates on sales. The effects of acquisitions and divestitures and currency exchange rates are removed to allow investors and the company to meaningfully evaluate changes in sales on a comparable basis from period to period.

Discussion Agenda

Financial Highlights

Influences on Sales & Earnings WIN Strategy Balance Sheet & Cash Flow Trends Outlook Questions & Answers

Financial Highlights

EPS*– 3rd Quarter and YTD as of March 31, 2005 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 $1.18 $0.88 $3.21 $1.80

3Q FY 05 3Q FY 04 YTD FY 05 YTD FY 04

* Earnings Per Share From Continuing Operations

Financial Highlights

Sales – 3rd Quarter and YTD through March 31

3rd

Quarter

YTD

FY05

FY04

FY05

FY04

Sales

$2,142

$1,879

$6,005

$5,035

% change

14%

19%

Sales from acquisitions & divestitures

$135

$8

$301

$29

Sales without acquisitions & divestitures

$2,007

$1,871

$5,704

$5,006

% change

7%

14%

Currency effects

$39

$141

Sales without acquisitions, divestitures & currency

$1,968

$1,871

$5,563

$5,006

% change

5%

11%

Significant Influences on Sales

Continued Industrial End Market Strength

Aerospace

Commercial Defense

Globalization Trends

Parker New Order Rates

Industrial North America

30 20 10 0 -10 -20 -30 -40

J O

J 96

A J O

J 97

A J O

J 98

A J O

J 99

A J O

J 00

A J O

J 01

A J O

J 02

A J O

J 03

A J O

J 04

A J O

J 05

Current month vs. prior year

5

Parker New Order Rates

Industrial R.O.W.

30 25 20 15 10 5 0 -5 -10 -15

J O

J 96

A J O

J 97

A J O

J 98

A J O

J

99

A J O

J 00

A J O

J 01

A J O

J 02

A J O

J

03

A J O

J 04

A J O

J 05

Current month vs. prior year

4

Parker New Order Rates

Climate & Industrial Controls

30 25 20 15 10 5 0 -5 -10 -15 -20

J O

J 02

A J O

J 03

A J O

J 04

A J O

J 05

Current month vs. prior year

-3

Parker New Order Rates

Aerospace

30 20 10 0 10 20 30

J O J A J O J A J O J A J O J A J O J A J O J A J O J A J O J A J O J A J O J

Average last 12 months orders to previous 12 months orders

12

Influences on Earnings

Increased Volume

Win Strategy

Restructuring/Move to Low Cost Countries Sales Mix – Aerospace Inventory Changes

Segment Reporting Industrial North America

FY2005

FY2004

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$925

$2,577

$815

$2,168

% change

13%

19%

Acquisitions & Divestitures

$57

$109

$6

$16

without Acquisitions & Divestitures

$868

$2,468

$809

$2,152

% change

9%

15%

Currency effects

$3

$8

without Acquisitions, Divestitures, & Currency

$865

$2,460

$809

$2,152

% change

8%

14%

Operating Margin

As reported

$120

$340

$89

$180

% of sales

13%

13%

11%

8%

Segment Reporting Industrial Rest of World

FY 2005

FY 2004

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$623

$1,756

$542

$1,405

% change

15%

25%

Acquisitions & Divestitures

$32

$115

without Acquisitions & Divestitures

$591

$1,641

$542

$1,405

% change

9%

17%

Currency effects

$29

$110

without Acquisitions, Divestitures, & Currency

$562

$1,531

$542

$1,405

% change

4%

9%

Operating Margin

As reported

$63

$191

$43

$104

% of sales

10%

11%

8%

7%

Segment Reporting Aerospace

FY 2005

FY 2004

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$337

$995

$315

$889

% change

7%

12%

Acquisitions & Divestitures

without Acquisitions & Divestitures

$337

$995

$315

$889

% change

7%

12%

Currency effects

$1

$4

without Acquisitions, Currency, & Divestitures

$336

$991

$315

$889

% change

7%

12%

Operating Margin

As reported

$44

$145

$42

$114

% of sales

13%

15%

13%

13%

Segment Reporting Climate & Industrial Controls

FY 2005

FY 2004

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$227

$569

$181

$482

% change

25%

18%

Acquisitions & Divestitures

$46

$77

without Acquisitions & Divestitures

$181

$492

$181

$482

% change

2%

Currency effects

$4

$10

without Acquisitions, Divestitures, & Currency

$177

$482

$181

$482

% change

-2%

Operating Margin

As reported

$27

$51

$21

$49

% of sales

12%

9%

12%

10%

Segment Reporting Other

FY 2005

FY 2004

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$29

$108

$26

$90

% change

11%

20%

Acquisitions & Divestitures

$2

$14

without Acquisitions & Divestitures

$29

$108

$24

$76

% change

21%

42%

Currency effects

$2

$9

without Acquisitions, Divestitures & Currency

$27

$99

$24

$76

% change

12%

30%

Operating Margin

As reported

$2

$14

-

$3

% of sales

8%

13%

-

3%

Balance Sheet Summary

Cash

Working Capital

Inventory

Accounts Receivable

PP & E

Shareholders Equity

Financial Leverage

Debt to Debt Equity

38.0% 36.0% 34.0% 32.0% 30.0% 28.0% 26.0% 24.0% 22.0% 20.0%

FY99 FY00 FY01 FY02 FY03 FY04 Q3 FY05

Target

22.2%

Strong Cash Flow

FY05 YTD $517

Operating Cash Flow $800 $700 $600 $500 $400 $300 $200 $100 $0

459

538

529

631

557

662

FY 99 FY 00 FY 01 FY 02 FY 03 FY 04

12.0% 10.0% 8.0% 6.0% 4.0%

% to Sales

FY 2005 Earnings Outlook Assumptions Segment Sales & Operating Income

FY 2005 Sales change vs. FY 2004

NA Industrial

15.8% -

16.5%

Industrial ROW

20.0% -

21.3%

Aerospace

10.0% -

11.9%

CIC

18.5% -

19.6%

Other

9.0% -

10.9%

FY 2005 Change in Operating Margin percentage vs.

FY 2004

Basis points

NA Industrial

330—360

Industrial ROW

250—270

Aerospace

120—170

CIC

-10—-70

Other

520—550

FY 2005 Earnings Outlook Assumptions below Operating Margin

Corporate Admin. -2% to -4% vs. FY 2004 Interest Expense -7% to -9% vs. FY 2004 Other Exp. (Income)* +230% to +250% vs. FY 2004 Tax Rate 29.0%

*Other: FY04—included non-recurring income from sale of business units FY05—included non-recurring expense for pension curtailment and real estate investment write off

Earnings Outlook

Fiscal Year 2005 EPS Range $4.72—$4.92

(Includes $0.47 From Discontinued Operations)

Forecast Risks

Increased Costs

Ability to Match Prices Increases to Cost Increases Customer Accumulation vs. Liquidation of Inventories Plant Utilization and Capital Spending Plans Airline Industry Financial Health & Defense Budget Interest Rates

Questions & Answers...

Appendix

Income Statements & Quarterly Segment Data

Income Statement – 3rd Quarter

FY 2005

FY 2004

% of Sales

% of Sales

Net sales

$2,141.7

100.0%

$1,879.1

100.0%

Cost of sales

1,712.9

80.0%

1,526.3

81.2%

Gross profit

428.8

20.0%

352.8

18.8%

S, G & A

218.2

11.4%

195.5

10.4%

Interest expense

(17.1)

-0.8%

(17.2)

-0.9%

Interest & other income

(1.9)

-0.1%

(0.8)

0.0%

(19.0)

-0.9%

(18.0)

-1.0%

Income from Cont’g Operations b/f taxes

191.6

8.9%

139.3

7.4%

Income taxes

49.5

2.3%

33.5

1.8%

Income from Cont’g Operations

$142.2

6.6%

$105.7

5.6%

Discontinued Operations

($2.8)

-0.1%

$2.1

0.1%

Net Income

$139.4

6.5%

$107.8

5.7%

Income Statement – 3rd Quarter YTD

FY 2005

FY 2004

% of Sales

% of Sales

Net sales

$6,004.6

100.0%

$5,034.5

100.0%

Cost of sales

4,769.6

79.4%

4,123.0

81.9%

Gross profit

1,234.9

20.6%

911.5

18.1%

S, G & A

636.2

10.6%

553.9

11.0%

Interest expense

(50.6)

-0.8%

(56.2)

-1.1%

Interest & other income

(11.1)

-0.2%

(3.2)

-0.1%

(61.7)

-1.0%

(59.4)

-1.2%

Income from Cont’g Operations b/f taxes

537.0

8.9%

298.2

5.9%

Income taxes

150.5

2.5%

84.6

1.7%

Income from Cont’g Operations

$386.6

6.4%

$213.6

4.2%

Discontinued Operations

$56.7

0.9%

$6.7

0.1%

Net Income

$443.3

7.4%

$220.3

4.4%

Restated Income Statement

CONSOLIDATED STATEMENT OF INCOME—Restated

Restated to present divestiture of a business unit as discontinued operations

Fiscal 2004

Fiscal 2005

(Dollars in thousands, except per share amounts)

9/30/2003

12/31/2003

3/31/2004

6/30/2004

Total

9/30/2004

12/31/2004

3/31/2005

Net sales

$1,562,105

$1,593,340

$1,879,057

$1,964,259

$6,998,761

$1,919,968

$1,942,887

$2,141,708

Cost of sales

1,282,882

1,313,802

1,526,297

1,549,313

5,672,294

1,510,399

1,546,357

1,712,884

Gross profit

279,223

279,538

352,760

414,946

1,326,467

409,569

396,530

428,824

Selling, general and

administrative expenses

174,917

183,524

195,452

222,642

776,535

197,134

220,846

218,207

Interest expense

21,751

17,267

17,229

16,972

73,219

16,216

17,288

17,116

Other (income) expense, net

1,636

760

792

(6,600)

(3,412)

10,847

(1,618)

1,872

Income from continuing operations

before income taxes

80,919

77,987

139,287

181,932

480,125

185,372

160,014

191,629

Income taxes

26,532

24,493

33,547

59,381

143,953

54,839

46,161

49,454

Income from continuing operations

54,387

53,494

105,740

122,551

336,172

130,533

113,853

142,175

Income from discontinued operations

2,304

2,277

2,108

2,922

9,611

2,250

57,274

(2,805)

Net income

$56,691

$55,771

$107,848

$125,473

$345,783

$132,783

$171,127

$139,370

Basic earnings per share:

Income from continuing operations

$0.46

$0.46

$0.89

$1.04

$2.86

$1.10

$0.96

$1.19

Income from discontinued operations

0.02

0.01

0.02

0.02

0.08

0.02

0.48

(0.02)

Net income per share

$0.48

$0.47

$0.91

$1.06

$2.94

$1.12

$1.44

$1.17

Diluted earnings per share:

Income from continuing operations

$0.46

$0.45

$0.88

$1.02

$2.82

$1.09

$0.94

$1.18

Income from discontinued operations

0.02

0.02

0.02

0.03

0.09

0.02

0.47

(0.03)

Net income per share

$0.48

$0.47

$0.90

$1.05

$2.91

$1.11

$1.41

$1.15

Note: Basic and diluted earnings per share amounts are computed independently for each of the quarters presented, therefore, the sum of the quarterly basic and diluted earnings per share amounts may not equal the total computed for the year.

Restated Quarterly Segment Data

BUSINESS SEGMENT INFORMATION BY INDUSTRY—Restated Industrial & Aerospace restated for reclass of business unit Other restated for the divestiture of business unit

Fiscal 2004

Fiscal 2005

(Dollars in thousands)

9/30/2003

12/31/2003

3/31/2004

6/30/2004

Total

9/30/2004

12/31/2004

3/31/2005

Net sales

Industrial:

North America

$667,777

$685,412

$815,239

$848,392

$3,016,820

$832,338

$819,243

$924,975

International

421,824

441,445

541,634

564,824

1,969,727

548,973

583,221

623,343

Aerospace

284,631

289,792

314,651

326,846

1,215,920

331,134

326,961

337,314

Climate & Industrial Controls

155,950

144,698

181,172

189,337

671,157

165,470

176,506

226,831

Other

31,923

31,993

26,361

34,860

125,137

42,053

36,956

29,245

Total

$1,562,105

$1,593,340

$1,879,057

$1,964,259

$6,998,761

$1,919,968

$1,942,887

$2,141,708

Segment operating income

Industrial:

North America

$43,045

$48,837

$88,605

$110,296

$290,783

$119,809

$99,862

$120,133

International

31,332

29,619

42,857

55,833

159,641

66,473

61,615

63,079

Aerospace

37,485

34,837

41,638

43,986

157,946

51,294

49,540

43,945

Climate & Industrial Controls

17,514

10,459

21,432

22,364

71,769

15,817

8,911

26,513

Other

2,175

983

(409)

5,389

8,138

6,773

4,744

2,379

Total segment operating income

131,551

124,735

194,123

237,868

688,277

260,166

224,672

256,049

Corporate general and administrative expenses

22,919

25,087

25,435

32,840

106,281

25,355

30,616

23,447

Income from continuing operations before

interest expense and other

108,632

99,648

168,688

205,028

581,996

234,811

194,056

232,602

Interest expense

21,751

17,267

17,229

16,972

73,219

16,216

17,288

17,116

Other

5,962

4,394

12,172

6,123

28,651

33,223

16,754

23,857

Income from continuing operations before income taxes

$80,919

$77,987

$139,287

$181,933

$480,126

$185,372

$160,014

$191,629