Illinois Tool Works Inc.

Good morning. My name is Julianne, and I will be your conference operator today. At this time, I would like to welcome everyone to the conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. For those participating in the Q&A, you'll have the opportunity to ask one question, and if needed, one follow-up question. Thank you. Karen Fletcher, Vice President of Investor Relations, you may begin your conference.

Okay, thank you, Julianne. Good morning and welcome to ITW's fourth quarter 2019 conference call. I'm joined with our Chairman and CEO, Scott Santee, and Senior Vice President and CFO, Michael Larson. During today's call, we will discuss fourth quarter and full year 2019 financial results and provide guidance for full year 2020. Slide 2 is a reminder that this presentation contains our financial forecast for 2020 as well as other forward-looking statements identified on this slide. We refer you to the company's 2018 Form 10-K for more detail about important risks that could cause actual results to differ materially from our expectations. This presentation uses certain non-GAAP measures, and a reconciliation of those measures to the most comparable GAAP measures is contained in the press release. Finally, I'd like to remind folks we have our Investor Day coming up six weeks from today on March 13th in Fort Worth, Texas. We encourage you to join us or listen to the webcast for an update on our strategy and long-range plans. A link to access the webcast is posted on our investor website. So please turn to slide three, and it's now my pleasure to turn the call over to our chairman and CEO, Scott Santee.

Thank you, Karen, and good morning, everyone. The ITW team delivered another quarter of solid operational execution and strong financial performance in Q4. Despite some broad-based macro challenges, we delivered gap EPS growth of 9%, operating margin of 23.7%, an after-tax return on invested capital of 28.9% in the quarter. For the full year, against the backdrop of an industrial demand environment that went from decelerating in the first half of the year to contracting in the second half of the year, we continued to execute well in the things within our control. As a result, despite revenues that were down $700 million, or 4.5% year-on-year, we delivered record GAAP EPS of 774, expanded operating margin to 24.4%, excluding higher restructuring expenses, and grew free cash flow by 9%. In addition, we were able to raise our dividend by 7% and return $2.8 billion to shareholders in the form of dividends and share repurchases. Equally important, in 2019, we continued to make solid progress on our path to ITW's full potential performance through the execution of of our enterprise strategy. Last year, we invested more than $600 million to support the execution of our strategy and further enhance the growth and profitability performance of our core businesses. In addition, each of our divisions continued to make progress in executing well-defined and focused plans to achieve full potential performance in their respective businesses. We look forward to providing a full progress update on our enterprise strategy and our progress towards ITW's full potential performance at our investor day in March. Looking ahead, ITW's powerful and proprietary business model, diversified high-quality business portfolio, and dedicated team of highly skilled ITW colleagues around the world position as well to continue to deliver differentiated performance across a range of economic scenarios in 2020 and beyond. And now I'll turn the call over to Michael, who will provide you with more detail on our Q4 and full-year 2019 performance, as well as our guidance for 2020. Michael. Thank you, Scott, and good morning, everyone.