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, 2006

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, 2006, Parker-Hannifin Corporation issued a press release and presented a Webcast announcing earnings for the quarter ended March 31, 2006. A copy of the press release is furnished as Exhibit 99.1 to this report. The press release contains references to earnings per share amounts excluding the effect of a loss recognized on the sale of a division. The removal of the loss on the sale of a division allows investors and the company to meaningfully evaluate performance on a comparable basis with the prior period, which was not impacted by the sale of a division. A copy of the Webcast presentation is furnished 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, 2006.
99.2	Webcast presentation by Parker-Hannifin Corporation, dated April 18, 2006.

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 Executive Vice President - Finance and Administration and Chief Financial Officer

Date: April 18, 2006

EX-99.1

Exhibit 99.1

For Release: Immediately
Contact:
Media – Christopher Farage - Vice President - Corp. Communications	216/896-2750
cfarage@parker.com
Financial Analysts – Pamela Huggins, Vice President - Treasurer	216/896-2240
phuggins@parker.com

Stock Symbol: PH – NYSE

Parker Hannifin Reports Record Sales, Income from Continuing Operations, and Cash Flow From Operations in Third Quarter

CLEVELAND, April 18, 2006 — Parker Hannifin Corporation (NYSE: PH) today reported third quarter records in sales and income from continuing operations, and year to date cash flow from operations. For the third quarter of fiscal-year 2006, sales were $2.50 billion, up 18.3 percent, as compared to sales of $2.11 billion from the same period last year. Income from continuing operations in the third quarter of fiscal 2006 was $1.46 per diluted share, compared to $1.16 in the prior year. Cash flow from operations reached $610.0 million or 9 percent of sales, a record for the first nine months, surpassing $498.4 million or 8.5 percent of sales in the same period last year.

The current quarter includes an expense of 3 cents per diluted share related to FAS 123R, which requires the expensing of equity based compensation, and income of 3 cents per diluted share as a result of a litigation settlement. These two items are included in “Other Expense” for segment reporting purposes, and are not included in the operating segment results.

“We had another strong quarter,” said Chairman and CEO Don Washkewicz . “The growth we demonstrated this quarter keeps us on track for another year of double-digit growth. Of our 18 percent growth in the quarter, 10 percent was organic, which reflects our commitment to premier customer service and our participation in global markets. We continue to do what we said we would do—grow this company by greater than 10 percent each year. This is a track record of accomplishment that can give confidence to our key stakeholders, including customers, employees, investors and creditors.”

1

Third Quarter Segment Results

“In the quarter,” Washkewicz continued, “we saw strength in our end markets and regions across the world. North America continued to grow, with the exception of the automotive market, as did Europe and Asia; Latin America remained solid. Our aerospace business continued to be very strong across both military and commercial markets.”

In the North American Industrial segment, third quarter operating income increased 37.1 percent over the prior year to $164.7 million, on sales of $1,062.7 million.

The International Industrial segment third quarter operating income increased 56.8 percent over the prior year to $98.9 million, on sales of $774.0 million.

In the company’s Climate & Industrial Controls segment, third quarter operating income decreased 10.4 percent over the prior year to $23.8 million, on sales of $270.4 million.

The Aerospace segment third quarter operating income increased 24.0 percent over the prior year to $54.5 million, on sales of $391.0 million.

Fiscal Year to Date Results

For the first nine months of fiscal-year 2006, sales were $6.77 billion, up 14.8 percent, as compared to sales of $5.90 billion from the same period last year. Income from continuing operations for the first nine months of fiscal 2006 was $3.73 per diluted share, compared to $3.13 in the same period in the prior year.

“We continue to be very pleased with our ability to generate record levels of income from continuing operations and cash flow from operations,” added Washkewicz. “These results, along with our improved cost basis and productivity gains from our Lean manufacturing initiative, allow us ample flexibility to invest in new technologies, new and emerging growth areas, and strategic acquisitions.”

2

“In addition,” Washkewicz continued, “one of the things that sets us apart, and accounts for our leadership position in motion and control technologies, is our ability to get our products, services, and systems anywhere in the world they are needed by our customers, and our customers’ customers. Our industry leadership and our double digit organic growth is achieved through our network of approximately 12,000 independent distribution and retail outlets that represent Parker across the world. This channel to market also helps drive our improving levels of customer service and delivery, which are at an all time high this year. It’s also a reflection of our focus on premier customer service, which our Win Strategy defines as the first order of business for every Parker operating unit across the world.”

Highlights

In the third quarter, Parker Hannifin acquired 70 percent of the shares of Japan-based Kuroda Pneumatics Ltd., a wholly owned subsidiary of Kuroda Precision Industries Ltd. Kuroda Pneumatics employs 150 people, had 2005 sales of approximately $50 million, and manufactures high performance actuators, cylinders, valves, controls and other related products for a wide variety of industrial automation applications. The addition of Kuroda Pneumatics strengthens Parker’s current automation business capabilities to better serve the Japanese marketplace, and the company’s long-term commitment to accelerating its growth in the Asia Pacific region.

The company also unveiled Parker RunWise at this month’s International Waste Expo in Las Vegas. Parker RunWise is an innovative energy recovery system resulting from a unique combination of hydraulic technologies, and will be another platform that drives the company’s organic growth. An early example of what the company is planning to achieve through its Winovation initiative, Parker RunWise marks another milestone in Parker’s evolution as an innovative company with the capability to provide customers with advanced systems solutions. Initially targeted to sanitation vehicles, this unique hybrid drive system is designed to provide fleet owners with significant gains in fuel economy of up to 50 percent, reduced brake wear, reduced engine emissions, and improved acceleration. Unlike electric hybrids, Parker RunWise uses lightweight hydraulic accumulators to store the energy from braking that is otherwise lost, and converts this energy to help the vehicle accelerate.

3

Outlook

The company revised the range of its fiscal 2006 annual earnings guidance provided on January 18, 2006. The following table summarizes the company’s earnings guidance, including the loss of 8 cents per diluted share from the divestiture of the Thermoplastics division which was announced last quarter:

	Annual EPS Guidance
	Low		High
Previous guidance, income from continuing operations, including loss from divestiture	$	4.97	$	5.22
Previous guidance, income from continuing operations, excluding loss from divestiture	$	5.05	$	5.30
Revised guidance, income from continuing operations, including loss from divestiture	$	5.07	$	5.22
Revised guidance, income from continuing operations, excluding loss from divestiture	$	5.15	$	5.30

The company continues to expect total FAS 123R expense for equity-based compensation in fiscal 2006 to be no more than 20 cents per diluted share, which includes the 16 cents per diluted share expense already incurred fiscal year to date.

“Our current results and the positive order trends we’ve been experiencing give us confidence that we will achieve another record year,” concluded Washkewicz. “Our Win Strategy is solidly in place, providing all our operating units with clarity of goals and a strategy that will allow us to achieve them. The goals are clear and achievable — 10 percent growth, top quartile return on invested capital, and a continuing commitment to premier customer service. We’re looking forward to an excellent finish to fiscal 2006 and the continuation of our strong performance over the longer range. With the support of our shareholders, and the talents and customer devotion of our 55,000 Parker employees, we are confident that we can sustain our strong record of creating total shareholder value over the years ahead.”

In addition to this information, Parker advises shareholders to note order trends, for which the company makes a disclosure several business days after the conclusion of each month. This information is available on the company’s investor information web site, at www.phstock.com.

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.

4

With annual sales exceeding $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 55,000 people in 46 countries around the world. Parker has increased its annual dividends paid to shareholders for 49 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 and innovation 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 manufacturing activity, air travel trends, 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.

5

PARKER HANNIFIN CORPORATION - MARCH 31, 2006

CONSOLIDATED STATEMENT OF INCOME

(Unaudited)

	Three Months Ended March 31,						Nine Months Ended March 31,
(Dollars in thousands except per share amounts)	2006			2005			2006		2005
Net sales	$	2,498,068		$	2,112,462		$	6,769,156	$	5,896,308
Cost of sales		1,952,191			1,688,804			5,313,627		4,683,403
Gross profit		545,877			423,658			1,455,529		1,212,905
Selling, general and administrative expenses		276,700			215,231			759,559		627,483
Interest expense		21,038			17,079			57,096		50,494
Other (income) expense, net		(6,929	)		2,026			4,242		11,568
Income from continuing operations before income taxes		255,068			189,322			634,632		523,360
Income taxes		77,545			48,676			184,237		146,265
Income from continuing operations		177,523			140,646			450,395		377,095
Discontinued operations					(1,276	)		28,884		66,185
Net income	$	177,523		$	139,370		$	479,279	$	443,280
Earnings per share:
Basic earnings per share from continuing operations	$	1.49		$	1.18		$	3.78	$	3.17
Discontinued operations					(.01	)		.25		.56
Basic earnings per share	$	1.49		$	1.17		$	4.03	$	3.73
Diluted earnings per share from continuing operations	$	1.46		$	1.16		$	3.73	$	3.13
Discontinued operations					(.01	)		.24		.55
Diluted earnings per share	$	1.46		$	1.15		$	3.97	$	3.68
Average shares outstanding during period - Basic		119,453,865			119,173,986			119,052,517		118,787,238
Average shares outstanding during period - Diluted		121,180,698			120,769,762			120,647,547		120,534,917
Cash dividends per common share	$	.23		$	.20		$	.69	$	.58
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)	2006			2005			2006		2005
Net sales
Industrial:
North America	$	1,062,686		$	924,975		$	2,921,651	$	2,576,556
International		774,018			623,343			2,071,308		1,755,537
Aerospace		390,966			337,314			1,085,047		995,409
Climate & Industrial Controls		270,398			226,831			691,150		568,807
Total	$	2,498,068		$	2,112,463		$	6,769,156	$	5,896,309
Segment operating income
Industrial:
North America	$	164,659		$	120,133		$	432,019	$	339,804
International		98,933			63,079			247,442		191,167
Aerospace		54,470			43,945			156,575		144,779
Climate & Industrial Controls		23,752			26,513			52,282		51,241
Total segment operating income	$	341,814		$	253,670		$	888,318	$	726,991
Corporate general and administrative expenses		36,159			23,395			93,475		79,264
Income from continuing operations before interest expense and other		305,655			230,275			794,843		647,727
Interest expense		21,038			17,079			57,096		50,494
Other expense		29,549			23,874			103,115		73,873
Income from continuing operations before income taxes	$	255,068		$	189,322		$	634,632	$	523,360
Note: Certain prior period amounts have been reclassified to conform to the current year presentation.

PARKER HANNIFIN CORPORATION - MARCH 31, 2006

CONSOLIDATED BALANCE SHEET

(Unaudited)

	March 31,
(Dollars in thousands)	2006			2005
Assets
Current assets:
Cash and cash equivalents	$	250,740		$	104,284
Accounts receivable, net		1,452,783			1,265,734
Inventories		1,137,108			1,051,678
Prepaid expenses		48,505			42,096
Deferred income taxes		111,542			106,506
Total current assets		3,000,678			2,570,298
Plant and equipment, net		1,638,492			1,609,289
Goodwill		2,000,264			1,403,232
Intangible assets, net		442,413			199,349
Other assets		890,670			840,032
Net assets of discontinued operations					95,323
Total assets	$	7,972,517		$	6,717,523
Liabilities and shareholders’ equity
Current liabilities:
Notes payable	$	365,306		$	18,098
Accounts payable		619,558			518,920
Accrued liabilities		626,807			556,004
Accrued domestic and foreign taxes		109,155			118,012
Total current liabilities		1,720,826			1,211,034
Long-term debt		1,054,498			966,814
Pensions and other postretirement benefits		1,066,414			822,124
Deferred income taxes		98,791			73,118
Other liabilities		211,867			183,382
Shareholders’ equity		3,820,121			3,461,051
Total liabilities and shareholders’ equity	$	7,972,517		$	6,717,523
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)	2006			2005
Cash flows from operating activities:
Net income	$	479,279		$	443,280
Net (income) from discontinued operations		(28,884	)		(66,185	)
Depreciation and amortization		209,269			195,762
Stock-based compensation		28,072
Net change in receivables, inventories, and trade payables		(105,648	)		(43,316	)
Net change in other assets and liabilities		38,925			(4,489	)
Other, net		(1,713	)		(2,317	)
Discontinued operations		(9,266	)		(24,336	)
Net cash provided by operating activities		610,034			498,399
Cash flows from investing activities:
Acquisitions (net of cash of $20,846 in 2006 and $4,653 in 2005)		(809,566	)		(530,901	)
Capital expenditures		(152,654	)		(111,660	)
Proceeds from sale of businesses		92,715			120,000
Other, net		10,642			27,483
Discontinued operations		(100	)		(2,148	)
Net cash (used in) investing activities		(858,963	)		(497,226	)
Cash flows from financing activities:
Net proceeds from common share activity		27,517			5,946
Net proceeds from (payments of) debt		217,380			(21,175	)
Dividends		(82,101	)		(68,880	)
Net cash provided by (used in) financing activities		162,796			(84,109	)
Effect of exchange rate changes on cash		793			3,373
Net (decrease) in cash and cash equivalents		(85,340	)		(79,563	)
Cash and cash equivalents at beginning of period		336,080			183,847
Cash and cash equivalents at end of period	$	250,740		$	104,284
Note: Certain prior period amounts have been reclassified to conform to the current year presentation.

EX-99.2

Parker Hannifin Corporation

Quarterly Earnings Release

3rd Quarter FY 2006

April 18, 2006

.

Exhibit 99.2

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 and innovation 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

manufacturing activity, air travel trends, 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

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.

This presentation contains references to earnings per share amounts

excluding the effect of the adoption of FAS 123R, a litigation settlement,

and a loss recognized on the sale of a division.  The removal of

the FAS

123R effect, the litigation settlement and the loss on the sale of a

division

allows

investors

and

the

company

to

meaningfully

evaluate

performance

on

a

comparable

basis

with

the

prior period, which was not

impacted by FAS 123R, the litigation settlement or the sale of a

division.

Discussion Agenda

Financial Highlights

Outlook

Questions & Answers

CEO Comments

Financial Highlights

EPS –

3rd Quarter and YTD as of March 31st

FY2006

FY2005

FY 2006

FY 2005

EPS as Reported

1.46

$          

1.15

$          

3.97

$          

3.68

$          

Discontinued Operations

-

(0.01)

0.24

0.55

EPS from Continuing Operations as reported

1.46

$          

1.16

$          

3.73

$          

3.13

$          

Loss on Sale of Thermoplastics

-

-

0.08

-

Litigation Settlement

(0.03)

-

(0.03)

-

FAS 123R expense

0.03

-

0.16

-

EPS from Continuing Operations Adjusted

1.46

$          

1.16

$          

3.94

$          

3.13

$          

First Nine Months

Third Quarter

Financial Highlights

EPS  from Continuing Operations

3rd Quarter and YTD as of March 31st

$1.16

$3.13

$3.73

$1.46

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

Q3 FY06

Q3 FY05

YTD FY06

YTD FY05

Influences on Earnings

Increased Volume

Win Strategy

Restructuring/Move to Low Cost Countries

Sales Mix –

Aerospace

Inventory Changes

Financial Highlights

Sales –

3rd Quarter and YTD through March 31st

FY06

FY05

FY06

FY05

Sales

$2,498

$2,112

$6,769

$5,896

% change

18%

15%

Sales from acquisitions & divestitures

$203

$500

Sales without acquisitions & divestitures

$2,295

$2,112

$6,269

$5,896

% change

9%

6%

Currency effects

($37)

($67)

Sales without acquisitions, divestitures & currency

$2,332

$2,112

$6,336

$5,896

% change

10%

7%

3rd  Quarter

YTD

Influences on Sales

Continued Industrial End Market Strength

Aerospace

Commercial OEM

Globalization Trends

Acquisitions

Segment Reporting

Industrial North America

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$1,063

$2,922

$925

$2,577

% change

15%

13%

Acquisitions

$60

$177

without Acquisitions

$1,003

$2,745

$925

$2,577

% change

8%

7%

Currency effects

$5

$12

without Acquisitions & Currency

$998

$2,733

$925

$2,577

% change

8%

6%

Operating Margin

As reported

$165

$432

$120

$340

% of sales

15%

15%

13%

13%

FY2006

FY2005

Segment Reporting

Industrial Rest of World

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$774

$2,071

$623

$1,756

% change

24%

18%

Acquisitions

$118

$251

without Acquisitions

$656

$1,820

$623

$1,756

% change

5%

4%

Currency effects

($39)

($74)

without Acquisitions & Currency

$695

$1,894

$623

$1,756

% change

12%

8%

Operating Margin

As reported

$99

$247

$63

$191

% of sales

13%

12%

10%

11%

FY 2006

FY 2005

Segment Reporting

Aerospace

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$391

$1,085

$337

$995

% change

16%

9%

Acquisitions

without Acquisitions

$391

$1,085

$337

$995

% change

16%

9%

Currency effects

($2)

($4)

without Acquisitions

$393

$1,089

$337

$995

% change

17%

9%

Operating Margin

As reported

$54

$157

$44

$145

% of sales

14%

14%

13%

15%

FY 2006

FY 2005

Segment Reporting

Climate & Industrial Controls

3rd Qtr

YTD

3rd Qtr

YTD

Sales

As reported

$270

$691

$227

$569

% change

19%

22%

Acquisitions

$25

$72

without Acquisitions

$245

$619

$227

$569

% change

8%

9%

Currency effects

($1)

without Acquisitions & Currency

$246

$619

$227

$569

% change

8%

9%

Operating Margin

As reported

$24

$52

$27

$51

% of sales

9%

8%

12%

9%

FY 2006

FY 2005

Fiscal YTD Results

Sales Increased 14.8%

7.4% Organic Growth

Cash flow from operations -9.0% of sales

Earnings from continuing operations per

diluted share of $3.73, up 19.2% from

$3.13 last year

Year over Year Comparisons

Excludes Acquisitions & Currency

Aerospace Calculated on 12-Month Moving Average

Parker New Order Rates

March-06

March-05

March-04

North American Industrial

+3%

+5%

+24%

International Industrial

+2%

+4%

+16%

Aerospace

+23%

+12%

+11%

Climate & Industrial Controls

+14%

-3%

+1%

Strong Cash Flow –

Cash From Operations

FY06 YTD $610M

459

538

529

631

551

662

854

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

4.0%

6.0%

8.0%

10.0%

12.0%

Financial Leverage

Debt to Debt Equity

27.1%

20.0%

22.0%

24.0%

26.0%

28.0%

30.0%

32.0%

34.0%

36.0%

38.0%

FY99

FY00

FY01

FY02

FY03

FY04

FY05

FY06

Target

Balance Sheet Summary

Cash

Working Capital

Inventory

Accounts Receivable

PP & E

Shareholders Equity

FY 2006  Earnings Outlook Assumptions

Segment Sales & Operating Income

FY 2006 Sales Change versus FY 2005

22.0%

-

20.0%

CIC

9.2%

-

8.8%

Aerospace

18.2%

-

17.5%

Industrial ROW

13.6%

-

13.2%

NA Industrial

FY 2006 Operating Margin Percentages

8.3%

-

8.0%

CIC

14.6%

-

14.4%

Aerospace

12.1%

-

11.9%

Industrial ROW

15.0%

-

14.8%

NA Industrial

FY 2006  Earnings Outlook assumptions

below Operating Margin

Corporate Admin

+18.5% to +19.5%

vs. FY 2005

Interest Expense

+16.0% to  +17.0% vs. FY 2005

Other Exp. (Income) *

+35.0% to +38.0%

vs. FY 2005

Tax Rate

29.0%

*Adoption of FAS 123R by the Company will result in additional expense of no more than $.20 per diluted share in Fiscal

Year 2006 all of which will be reflected in the Other Expense (Income) line.  Loss on Sale of Thermoplastics and income

from litigation settlement are also included in the Other Expense (Income) line.

Earnings Outlook

Low

High

Previous guidance, income from continuing operations

$4.97

$5.22

including loss from divestiture

Revised guidance, income from continuing operations

$5.07

$5.22

including loss from divestiture

Revised guidance, income from continuing operations

$5.15

$5.30

excluding loss from divestiture

Previous guidance, income from continuing operations

$5.05

$5.30

excluding loss from divestiture

Questions & Answers...

Appendix

Income Statements

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Income Statement –

3rd Quarter

% of Sales

% of Sales

Net sales

$2,498.1

100.0%

$2,112.5

100.0%

Cost of sales

1,952.2

78.1%

1,688.8

79.9%

Gross profit

545.9

21.9%

423.7

20.1%

S, G & A

276.7

11.1%

215.2

10.2%

Interest expense

21.0

0.8%

17.1

0.8%

Other expense

(6.9)

-0.3%

2.0

0.1%

Income from Cont'g Operations b/f taxes

255.1

10.2%

189.3

9.0%

Income taxes

77.5

3.1%

48.7

2.3%

Income from Cont'g Operations

$177.5

7.1%

$140.6

6.7%

     Discontinued Operations

0.0%

(1.3)

-0.1%

Net Income

$177.5

7.1%

$139.4

6.6%

FY 2006

FY 2005

Income Statement –

3rd Quarter YTD

% of Sales

% of Sales

Net sales

$6,769.2

100.0%

$5,896.3

100.0%

Cost of sales

5,313.6

78.5%

4,683.4

79.4%

Gross profit

1,455.5

21.5%

1,212.9

20.6%

S, G & A

759.6

11.2%

627.5

10.6%

Interest expense

57.1

0.8%

50.5

0.9%

Interest & other income

4.2

0.1%

11.6

0.2%

Income from Cont'g Operations b/f taxes

634.6

9.4%

523.4

8.9%

Income taxes

184.2

2.7%

146.3

2.5%

Income from Cont'g Operations

$450.4

6.7%

$377.1

6.4%

     Discontinued Operations

$28.9

0.4%

$66.2

1.1%

Net Income

$479.3

7.1%

$443.3

7.5%

FY 2006

FY 2005