Stock Analysis on Net

Illinois Tool Works Inc. (NYSE:ITW)

$22.49

This company has been moved to the archive! The financial data has not been updated since February 11, 2022.

Analysis of Reportable Segments

Microsoft Excel

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Segment Profit Margin

Illinois Tool Works Inc., profit margin by reportable segment

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


Automotive OEM Segment
The profit margin exhibited a declining trend from 22.84% in 2017 to a low of 17.78% in 2020. A modest recovery was noted in 2021, with the margin increasing to 19.46%, though it remained below the levels observed in 2017 through 2019.
Food Equipment Segment
Margins showed relative stability in the early years, hovering around 26%. However, there was a significant dip in 2020, dropping to 19.67%, followed by a partial rebound to 22.57% in 2021. This pattern suggests sensitivity to external factors impacting profitability during 2020.
Test & Measurement and Electronics Segment
This segment demonstrated a consistent upward trajectory in profit margins, rising from 22.43% in 2017 to 27.41% in 2021. Notably, margins increased steadily each year except for a minor plateau between 2019 and 2020.
Welding Segment
The welding segment maintained relatively high profit margins throughout the period. Starting at 26.98% in 2017, margins increased gradually to reach 29.7% by 2021, indicating sustained profitability and potential operational efficiency.
Polymers & Fluids Segment
Profit margins showed a positive trend across the timeline, increasing from 20.71% in 2017 to 25.33% in 2021. The most notable growth occurred after 2019, suggesting improvements in cost management or market conditions.
Construction Products Segment
The margin profile for construction products experienced moderate growth, rising from 23.86% in 2017 to 27.25% in 2021. The data indicates a consistent upward movement, especially from 2019 onward.
Specialty Products Segment
This segment reported relatively high and stable margins, starting at 27.19% in 2017 and concluding at 27.18% in 2021, with minor fluctuations in intervening years. This steadiness points to a robust profit structure.
General Observations
Across most segments, margins faced headwinds in 2020, likely linked to economic disruptions during that period, with varying degrees of recovery observed in 2021. Segments such as Welding, Test & Measurement and Electronics, Polymers & Fluids, and Construction Products show clear long-term margin improvement, indicating strengthening profitability. Conversely, Automotive OEM and Food Equipment segments experienced more volatility and slower recovery trajectories.

Segment Profit Margin: Automotive OEM

Illinois Tool Works Inc.; Automotive OEM; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


Operating Revenue
Operating revenue exhibited a fluctuating trend over the five-year period. There was an increase from 3,271 million US dollars in 2017 to a peak of 3,338 million US dollars in 2018. Subsequently, revenue declined consecutively to 3,063 million in 2019 and further to 2,571 million in 2020. In 2021, a modest recovery was noted with revenue rising to 2,800 million US dollars, though it remained below the earlier peak levels.
Operating Income
Operating income showed a notable downward trend from 2017 through 2020, starting at 747 million US dollars in 2017 and decreasing to 457 million US dollars in 2020. In 2021, operating income experienced a partial rebound, increasing to 545 million US dollars; however, this value continued to trail behind figures from the years 2017 to 2019.
Segment Profit Margin
The segment profit margin mirrored the trends found in operating income and revenue, declining from 22.84% in 2017 to a low of 17.78% in 2020. A recovery phase was visible in 2021, with the margin rising to 19.46%, though it did not return to the initial higher margins seen in 2017 and 2018.
Overall Analysis
The data indicates that the segment experienced significant operational challenges starting in 2019, with both revenue and profitability decreasing through to 2020. The global economic environment and sector-specific factors likely contributed to this downward trajectory. The improvement in 2021 suggests a degree of recovery, yet performance metrics remain below those recorded in the earlier period. The decline in segment profit margin highlights pressure on costs and/or pricing, reflecting a less favorable operating environment during this period. Continued monitoring of these metrics would be advisable to assess the sustainability of the recovery.

Segment Profit Margin: Food Equipment

Illinois Tool Works Inc.; Food Equipment; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


Operating Income
The operating income exhibited an overall decline from 2017 to 2020, starting at 556 million US dollars in 2017, slightly increasing to 578 million in 2019, then sharply dropping to 342 million in 2020. In 2021, there was a partial recovery with operating income rising to 469 million, though this remained below the pre-2020 levels.
Operating Revenue
The operating revenue showed a fluctuating trend over the five-year period. It increased modestly from 2123 million US dollars in 2017 to 2214 million in 2018, then slightly decreased to 2188 million in 2019. A significant drop occurred in 2020 with revenue falling to 1739 million, followed by a rebound to 2078 million in 2021, yet not regaining the peak values of the earlier years.
Segment Profit Margin
The segment profit margin exhibited stability around 26% from 2017 through 2019. However, in 2020, the margin decreased markedly to 19.67%, reflecting profitability pressures during that year. In 2021, the margin improved to 22.57%, indicating some recovery but remaining below the levels seen before 2020.

Segment Profit Margin: Test & Measurement and Electronics

Illinois Tool Works Inc.; Test & Measurement and Electronics; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


Operating Income
Operating income demonstrated an overall upward trend from 2017 to 2021. Starting at US$464 million in 2017, it increased steadily to US$523 million in 2018 and US$542 million in 2019. A slight decline was observed in 2020, with operating income decreasing to US$507 million. However, the segment rebounded strongly in 2021, reaching a peak of US$643 million, indicating robust profitability improvement in that year.
Operating Revenue
Operating revenue followed a somewhat fluctuating pattern over the analyzed period. Beginning at US$2,069 million in 2017, revenue rose modestly to US$2,171 million in 2018 but then slightly declined to US$2,121 million in 2019. A more pronounced drop occurred in 2020, with revenue falling to US$1,963 million, likely reflecting challenging conditions in that year. In 2021, the segment experienced a significant recovery, with operating revenue increasing sharply to US$2,346 million, marking the highest level in the period.
Segment Profit Margin
The segment profit margin consistently improved throughout the period, indicating enhanced operational efficiency and profitability. Starting at 22.43% in 2017, the margin rose steadily each year to 24.09% in 2018, 25.55% in 2019, and 25.83% in 2020. The most notable increase occurred in 2021, when the margin reached 27.41%, the highest value recorded over the five years, reflecting strong cost management or higher value sales within the segment.

Segment Profit Margin: Welding

Illinois Tool Works Inc.; Welding; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


The analysis of the Welding reportable segment reveals several noteworthy trends over the five-year period ending December 31, 2021.

Operating Revenue
The operating revenue exhibited growth from 2017 through 2018, increasing from 1,538 million to 1,691 million US dollars. However, there was a decline in 2019 and a more significant drop in 2020, with revenue falling to 1,638 million and 1,384 million, respectively. The segment rebounded in 2021, rising to 1,650 million US dollars, though this figure remained slightly below the 2018 peak.
Operating Income
Operating income followed a similar trajectory with initial growth, increasing from 415 million in 2017 to 474 million in 2018. It then decreased moderately in 2019 to 453 million and more substantially in 2020 to 376 million. A strong recovery occurred in 2021, with operating income reaching 490 million US dollars, surpassing previous years' results.
Segment Profit Margin
The segment profit margin demonstrated relative stability with minor fluctuations. It improved from 26.98% in 2017 to peak at 28.03% in 2018, before slightly decreasing in subsequent years—27.66% in 2019 and 27.17% in 2020. In 2021, the profit margin increased notably to 29.7%, the highest level across the observed period.

Overall, the segment experienced a downturn in both revenue and operating income during 2019 and 2020, which corresponds to broader economic challenges during that timeframe. The significant recovery in 2021 reflects resilience and improved operational performance. The consistent profit margin, culminating in a record high in 2021, indicates effective cost management or pricing strategies despite periods of revenue volatility.


Segment Profit Margin: Polymers & Fluids

Illinois Tool Works Inc.; Polymers & Fluids; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


The analysis of the financial performance in the "Polymers & Fluids" segment over the five-year period reveals several notable trends. Operating income shows a consistent upward trajectory, starting at US$357 million in 2017 and increasing each year to reach US$457 million by 2021. This indicates a robust growth in the segment's profitability.

Operating revenue remains relatively stable between 2017 and 2018 at US$1,724 million but experiences a decline over the next two years, reaching a low of US$1,622 million in 2020. However, 2021 records a significant recovery with revenue rising to US$1,804 million, the highest in the observed period. This rebound suggests an improvement in sales or pricing power in the final year of the dataset.

Correspondingly, the segment profit margin demonstrates a consistent increase throughout the period. It rises from 20.71% in 2017 to 25.33% in 2021, reflecting enhanced operational efficiency, better cost management, or a favorable product mix. The margin's growth, especially notable from 2019 onwards, aligns with the upward trend in operating income despite the mid-period dip in revenue.

Operating Income
Steady growth each year, increasing by approximately 28% over five years.
Operating Revenue
Relatively stable initially, followed by a decline in 2019 and 2020, and a strong recovery in 2021 surpassing previous levels.
Segment Profit Margin
Consistent improvement year-over-year, indicating increasing profitability and operational effectiveness.

In summary, the segment demonstrates resilience and increasing profitability despite revenue fluctuations in the middle years. The strong profit margin growth and the recovery in operating revenue are positive indicators of the segment's financial health and operational performance over the five-year period.


Segment Profit Margin: Construction Products

Illinois Tool Works Inc.; Construction Products; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


Operating Income
The operating income exhibited a generally positive trend from 2017 to 2021, starting at 399 million US dollars in 2017 and ending at 530 million US dollars in 2021. There was a slight dip in 2019 to 383 million US dollars, but it recovered in the following years, reaching the highest value recorded in the period under review.
Operating Revenue
Operating revenue showed some fluctuations over the five-year period. It rose modestly from 1,672 million US dollars in 2017 to a peak of 1,700 million US dollars in 2018, then declined to 1,625 million US dollars in 2019. Revenue remained relatively stable in 2020 at 1,652 million US dollars before increasing significantly to 1,945 million US dollars in 2021, marking a substantial recovery and growth compared to earlier years.
Segment Profit Margin
The segment profit margin demonstrated a consistent upward trend. Beginning at 23.86% in 2017, the margin increased steadily each year, except for a minor decline in 2019 to 23.57%. The margin rose again to 25.48% in 2020 and further to 27.25% in 2021, indicating improving profitability within the segment.
Overall Analysis
Despite some variability in operating revenue, the segment showed improvement in both operating income and profit margin over the period, particularly notable in 2021. The robust increase in operating income alongside rising profit margins suggests enhanced operational efficiency and profitability. The data implies the segment was able to manage costs effectively while growing revenue towards the end of the timeframe, thereby strengthening financial performance.

Segment Profit Margin: Specialty Products

Illinois Tool Works Inc.; Specialty Products; segment profit margin calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Operating revenue
Segment Profitability Ratio
Segment profit margin1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment profit margin = 100 × Operating income ÷ Operating revenue
= 100 × ÷ =


Operating Income
The operating income of the segment showed a generally declining trend from 2017 to 2020, decreasing from 527 million USD in 2017 to 432 million USD in 2020. In 2021, however, there was a noticeable recovery with operating income rising to 504 million USD, approaching the levels observed in 2017 and 2018.
Operating Revenue
Operating revenue followed a downward pattern over the majority of the period examined. Starting at 1938 million USD in 2017, revenue marginally increased in 2018 to 1951 million USD but then declined significantly in 2019 and 2020 reaching a low of 1660 million USD in 2020. The year 2021 showed signs of recovery with revenue climbing back to 1854 million USD, indicating a rebound though not yet reaching the peak values of earlier years.
Segment Profit Margin
The segment profit margin displayed relatively stable performance across the five years, fluctuating narrowly between 25.86% and 27.19%. The margin decreased gradually from 27.19% in 2017 to a low of 25.86% in 2019 but improved moderately thereafter, returning to nearly the initial level at 27.18% in 2021. This stability suggests consistent profitability relative to revenue despite the fluctuations in absolute income and revenue figures.
Overall Analysis
The segment experienced challenges in both revenue and operating income during 2019 and 2020, potentially reflecting broader market or operational difficulties. The recovery in 2021 in both revenue and operating income indicates improved business conditions or operational efficiencies. Throughout the period, the profit margin remained relatively stable, suggesting effective cost management or pricing strategies that preserved profitability despite revenue volatility.

Segment Return on Assets (Segment ROA)

Illinois Tool Works Inc., ROA by reportable segment

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


The analysis of return on assets (ROA) percentages across several reportable segments reveals distinct trends and fluctuations over the five-year period.

Automotive OEM
This segment exhibited a generally declining trend in ROA from 31.1% in 2017 to a low of 19.85% in 2020, representing a significant reduction in asset efficiency. However, a partial recovery occurred in 2021, with the ROA increasing to 24.12%, indicating an improved but still subdued profitability relative to earlier years.
Food Equipment
The Food Equipment segment showed strong ROA values in 2017 and 2018, peaking at 56.13%, followed by a slight decrease in 2019 to 55.47%. A notable decline occurred in 2020, where ROA dropped sharply to 34.79%, likely reflecting operational challenges. In 2021, there was a partial rebound to 44.58%, though the ROA remained below its pre-2020 peak.
Test & Measurement and Electronics
This segment maintained relatively stable ROA figures from 2017 through 2020, fluctuating moderately between 18.95% and 22.83%. In 2021, a decline to 19.83% was observed, suggesting marginal deterioration in asset returns after several years of steadiness.
Welding
The Welding segment consistently demonstrated strong ROA performance, increasing from 54.89% in 2017 to a peak of 61.72% in 2019. Despite a drop in 2020 to 53.71%, ROA reached its highest level at 62.5% in 2021, indicating robust profitability and resilience throughout the period.
Polymers & Fluids
A clear upward trend is evident in this segment, with ROA increasing steadily each year from 17.27% in 2017 to 24.3% in 2021. This indicates progressive improvements in asset utilization and operational efficiency over the five-year span.
Construction Products
The Construction Products segment displayed a generally stable to slightly increasing ROA trend. The values ranged from 33.36% in 2017 to 38.77% in 2021, with moderate year-to-year fluctuations, suggesting consistent performance with incremental gains in asset profitability.
Specialty Products
ROA in Specialty Products showed a declining trend from 30.62% in 2017 to 26.42% in 2020, followed by a modest recovery to 29.96% in 2021. This pattern indicates some challenges in maintaining asset returns, but also some recent improvement toward former levels.

Overall, segments such as Welding and Polymers & Fluids showed notable strength and positive momentum in return on assets, while Automotive OEM and Food Equipment experienced more variability and declines before partial recoveries. Test & Measurement and Electronics, Construction Products, and Specialty Products exhibited moderate fluctuations with no extreme deviations, reflecting relatively steady but varied performance across segments. The impact of external factors, potentially including market conditions in 2020, appears evident in several segments through marked ROA declines and subsequent recoveries.


Segment ROA: Automotive OEM

Illinois Tool Works Inc.; Automotive OEM; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


The analysis of the annual Automotive OEM segment data reveals several significant trends across the five-year period from 2017 to 2021.

Operating Income
Operating income exhibited a generally declining trend over the period. After remaining relatively stable between 2017 and 2018, with values of 747 million and 751 million USD respectively, it decreased notably in 2019 to 659 million USD. This decline continued sharply in 2020, reaching 457 million USD, which likely reflects the impact of broader economic or industry-specific challenges during that year. In 2021, operating income showed partial recovery, increasing to 545 million USD, though it did not return to the earlier levels observed in 2017 and 2018.
Identifiable Assets
Identifiable assets demonstrated a slight but consistent decrease over the reviewed years. Starting at 2402 million USD in 2017, the asset base dropped marginally each year ending at 2260 million USD in 2021. This modest contraction may suggest asset optimization, disposals, or limited reinvestment in this segment during the period.
Segment Return on Assets (ROA)
The segment ROA exhibited a decline from a high of 31.45% in 2018 to a low of 19.85% in 2020, indicating a reduction in the efficiency of asset utilization to generate operating income. In 2021, there was a notable improvement to 24.12%, reflecting a recovery in operational profitability relative to assets, albeit still below the peak levels seen earlier in the period.

In summary, the data reflects a segment experiencing decreasing profitability and asset base contraction, particularly pronounced during the 2019-2020 interval. The 2021 figures suggest some recovery in both income and returns on assets, implying potential stabilization or improvement after a period of challenges.


Segment ROA: Food Equipment

Illinois Tool Works Inc.; Food Equipment; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


Operating Income
The operating income displayed a generally positive trend from 2017 through 2019, increasing slightly from 556 million USD in 2017 to 578 million USD in 2019. However, there was a significant decline in 2020, with operating income dropping to 342 million USD. In 2021, the operating income recovered partially to 469 million USD but remained below the levels observed in 2017 to 2019.
Identifiable Assets
Identifiable assets showed a moderate fluctuation during the examined years. The asset base decreased slightly from 1054 million USD in 2017 to 1019 million USD in 2018, followed by a minor increase to 1042 million USD in 2019. There was a decline again in 2020 to 983 million USD, with a subsequent recovery to 1052 million USD in 2021, nearly reaching the initial level of 2017.
Segment Return on Assets (ROA)
Segment ROA remained robust from 2017 through 2019, maintaining levels above 52%, and peaking at 56.13% in 2018. In 2020, there was a marked decline to 34.79%, reflecting a significant reduction in profitability relative to assets during that year. The ROA improved in 2021 to 44.58%, indicating a partial recovery but still lower than the pre-2020 period.
Summary Insights
The data indicates a strong and stable performance in operating income and asset utilization efficiency from 2017 to 2019. The sharp declines in 2020 across operating income and ROA suggest the impact of adverse conditions during that year, likely external factors. The subsequent recovery in 2021 demonstrates resilience but does not fully return to the previous peak levels, which may suggest ongoing challenges or a cautious market environment. Asset levels remained relatively stable throughout the period, showing no significant expansions or contractions.

Segment ROA: Test & Measurement and Electronics

Illinois Tool Works Inc.; Test & Measurement and Electronics; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


The annual data for the Test & Measurement and Electronics segment reflects several noteworthy trends over the five-year period.

Operating Income
The operating income exhibits a generally positive trend with an increase from 464 million US dollars in 2017 to 643 million US dollars in 2021. There was a consistent rise from 2017 to 2019, reaching 542 million, followed by a slight decline to 507 million in 2020. However, the figure rebounded strongly in 2021, achieving the highest value in the observed period. This indicates improving profitability potential despite a temporary dip in 2020.
Identifiable Assets
Identifiable assets remained fairly stable from 2017 through 2020, fluctuating slightly in the range of approximately 2200 to 2450 million US dollars. A significant increase is observed in 2021, where assets rose sharply to 3242 million US dollars. This substantial asset growth may suggest strategic investments or acquisitions that could support future growth in the segment.
Segment Return on Assets (ROA)
Segment ROA shows a rising performance from 18.95% in 2017 to a peak of approximately 22.83% in 2019, maintaining similar levels through 2020. However, there is a noticeable decline in 2021 to 19.83%, despite the higher operating income and assets. This decline in ROA suggests that the increase in assets was not immediately matched by proportional operating income gains, indicating potential inefficiencies or the time lag in realizing returns on new investments.

Overall, the segment demonstrates growth in profitability and asset base over the five years, with some fluctuations in efficiency as indicated by ROA. The dramatic asset increase in the final year and the corresponding dip in ROA warrant attention to understand the causes and potential future impacts on segment performance.


Segment ROA: Welding

Illinois Tool Works Inc.; Welding; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


Operating Income
The operating income demonstrated variability over the observed period. It increased from 415 million USD in 2017 to a peak of 474 million USD in 2018. This was followed by a slight decline to 453 million USD in 2019 and a more marked decrease to 376 million USD in 2020. The segment rebounded strongly in 2021, reaching the highest value in the series at 490 million USD. This pattern suggests resilience with a notable recovery after the downturn in 2020.
Identifiable Assets
The identifiable assets showed minor fluctuations with an overall modest decrease from 756 million USD in 2017 to 700 million USD in 2020. However, there was an upward adjustment in 2021, where assets rose again to 784 million USD, exceeding the starting point. This trend indicates a relatively stable asset base with a slight dip followed by replenishment or growth towards the end of the period.
Segment Return on Assets (ROA)
The segment ROA maintained a generally high and stable level, ranging between approximately 54.9% and 62.5%. It increased from 54.89% in 2017 to a peak of 61.72% in 2019, dipped to 53.71% in 2020, and then rose again to 62.5% in 2021. This trend aligns with the fluctuations seen in operating income and assets, reflecting efficiency and profitability improvements in asset utilization, with a temporary decline coinciding with the fall in operating income in 2020.

Segment ROA: Polymers & Fluids

Illinois Tool Works Inc.; Polymers & Fluids; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


Operating Income
The operating income of the segment exhibits a positive trend over the five-year period. Beginning at $357 million in 2017, it shows a gradual annual increase, reaching $457 million by the end of 2021. This indicates steady growth in profitability within the segment.
Identifiable Assets
Identifiable assets reveal a declining trend from $2,067 million in 2017 to $1,855 million in 2020, followed by a slight increase to $1,881 million in 2021. Overall, the asset base contracted by approximately 9% over the period, suggesting possible divestitures, asset optimization, or depreciation impacts.
Segment Return on Assets (ROA)
The segment ROA demonstrates a consistent improvement throughout the period. Starting at 17.27% in 2017, it rises annually to achieve 24.3% by the end of 2021. This upward movement reflects enhanced efficiency in utilizing assets to generate operating income.

Segment ROA: Construction Products

Illinois Tool Works Inc.; Construction Products; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


Operating Income
The operating income demonstrates a general upward trend over the five-year period. Starting at 399 million USD in 2017, it increased steadily to 414 million USD in 2018. There was a slight decline to 383 million USD in 2019, followed by a recovery to 421 million USD in 2020. The most significant growth occurred in 2021, reaching 530 million USD, marking the highest operating income in the period and a substantial increase compared to the prior years.
Identifiable Assets
Identifiable assets remained relatively stable between 2017 and 2019, with minor fluctuations from 1,196 million USD in 2017 to 1,167 million USD in 2018 and 1,176 million USD in 2019. Starting in 2020, the assets increased more noticeably, rising to 1,239 million USD and then to 1,367 million USD in 2021. This suggests a period of expansion or reinvestment in the segment during the last two years under review.
Segment Return on Assets (ROA)
The segment return on assets shows an overall positive trend with fluctuations. The ROA was relatively strong at 33.36% in 2017, improving to 35.48% in 2018 before dipping to 32.57% in 2019. It then rebounded to 33.98% in 2020 and saw a significant increase to 38.77% in 2021, indicating improved profitability relative to the asset base in the most recent year.
Summary of Trends
Across all key metrics, the data reflects a period of stable to improving performance, particularly in the last two years. The operating income and identifiable assets both show growth trends beginning in 2020, which is accompanied by an increase in segment ROA, highlighting enhanced efficiency and profitability. The dip in operating income and ROA in 2019 appears to be a temporary setback, with subsequent recovery and stronger results in 2020 and 2021. Overall, the segment displays increased asset investment alongside improved returns, suggesting effective management of resources and market conditions in the latest periods.

Segment ROA: Specialty Products

Illinois Tool Works Inc.; Specialty Products; segment ROA calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating income
Identifiable assets
Segment Profitability Ratio
Segment ROA1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment ROA = 100 × Operating income ÷ Identifiable assets
= 100 × ÷ =


Operating Income
The operating income for the Specialty Products segment exhibited fluctuations over the five-year period. Starting at 527 million US dollars in 2017, it decreased slightly to 522 million in 2018, followed by a more pronounced decline to 472 million in 2019. The downward trend continued into 2020, reaching 432 million. However, a recovery is evident in 2021 with operating income rising to 504 million, indicating a partial rebound from prior declines.
Identifiable Assets
Identifiable assets showed a gradual decline from 1,721 million US dollars in 2017 to 1,635 million in 2020. This decrease was relatively steady but modest. In 2021, a slight increase to 1,682 million was observed, suggesting a stabilization or modest growth in asset base after four years of reduction.
Segment Return on Assets (ROA)
Segment ROA demonstrated a declining trend from 30.62% in 2017 to 26.42% in 2020, reflecting decreasing efficiency or profitability relative to assets during this period. In 2021, the ROA improved notably to 29.96%, which aligns with the increased operating income and asset base, indicating enhanced asset utilization and a strengthening performance in the final year analyzed.

Segment Asset Turnover

Illinois Tool Works Inc., asset turnover by reportable segment

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


The analysis of the annual reportable segment asset turnover ratios reveals distinct trends across the various segments over the five-year period ending December 31, 2021.

Automotive OEM
The asset turnover ratio exhibits a decreasing trend from 1.40 in 2018 to a low of 1.12 in 2020, followed by a partial recovery to 1.24 in 2021. This suggests a moderate decline in asset efficiency during the mid-period with some improvement in the final year.
Food Equipment
The ratio is relatively stable at a high level, peaking at 2.17 in 2018, then dipping to 1.77 in 2020 before rising again to 1.98 in 2021. This pattern indicates strong asset utilization overall, notwithstanding a temporary dip possibly related to external factors affecting 2020.
Test & Measurement and Electronics
This segment shows a gradual decline in asset turnover from 0.93 in 2018 to 0.72 in 2021, with a slight drop already present in 2019. The steady decrease indicates diminishing efficiency in asset use over the period.
Welding
The ratio remains relatively robust, increasing from 2.03 in 2017 to a peak of 2.23 in 2019, decreasing slightly in 2020 to 1.98, and improving again to 2.10 in 2021. This pattern suggests strong asset turnover with minor volatility.
Polymers & Fluids
The data shows a modest upward trend, from 0.83 in 2017 to 0.96 in 2021, with minor fluctuations. This implies gradual improvement in asset utilization over the examined years.
Construction Products
The turnover ratio remains relatively consistent, fluctuating slightly around 1.4 to 1.46 until 2018, dipping to 1.33 in 2020, then rebounding to 1.42 in 2021. This indicates stable asset efficiency with a minor impact during 2020.
Specialty Products
The ratio declines from 1.16 in 2018 to 1.02 in 2020, with a rebound to 1.10 in 2021. This suggests a temporary reduction in asset turnover efficiency, partially recovered by the end of the period.

Overall, several segments experienced a dip in asset turnover ratios around 2020, which may be indicative of external disruptions during that period. Most segments show a degree of recovery in 2021, although the magnitude varies. The Welding and Food Equipment segments consistently demonstrate higher asset turnover ratios compared to others, indicating better relative asset utilization.


Segment Asset Turnover: Automotive OEM

Illinois Tool Works Inc.; Automotive OEM; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


The Automotive OEM segment exhibits several distinct trends over the analyzed five-year period ending in 2021.

Operating Revenue
The segment's operating revenue increased slightly from 3271 million USD in 2017 to 3338 million USD in 2018, before declining to 3063 million USD in 2019. This downward trajectory continued more sharply into 2020, with revenue dropping to 2571 million USD, likely reflecting external challenges. A modest recovery is observed in 2021, with revenue rising to 2800 million USD, though it remains below earlier levels from 2017 and 2018.
Identifiable Assets
The identifiable assets of the segment display a gradual decrease over the period. Starting at 2402 million USD in 2017, assets slightly declined to 2388 million USD in 2018 and remained relatively stable at 2417 million USD in 2019. A more noticeable reduction occurred in 2020 and 2021, with assets decreasing to 2302 million USD and 2260 million USD respectively, pointing to possible asset disposals, impairments, or reduced investments in the segment.
Segment Asset Turnover
The asset turnover ratio, which measures efficiency in using assets to generate sales, starts at 1.36 in 2017 and increases slightly to 1.40 in 2018. This is followed by a decline to 1.27 in 2019 and a more significant drop to 1.12 in 2020, aligning with reduced revenue during this period. By 2021, the ratio improves to 1.24, indicating a partial rebound in asset utilization efficiency, correlating with the uptick in operating revenue.

Overall, the segment faced challenges impacting both revenue and asset base starting in 2019, with the most pronounced effects in 2020. Subsequent modest recovery in 2021 is evident but has not yet restored the segment to its earlier performance levels. The declining asset base alongside fluctuating asset turnover ratios suggests adjustments in asset management and operational efficiency over the period.


Segment Asset Turnover: Food Equipment

Illinois Tool Works Inc.; Food Equipment; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


The analysis of the Food Equipment reportable segment over the five-year period reveals several notable trends in operating revenue, identifiable assets, and segment asset turnover.

Operating Revenue
The operating revenue exhibited moderate growth from 2017 to 2018, increasing from $2,123 million to $2,214 million. In 2019, revenue slightly declined to $2,188 million and experienced a more pronounced decrease in 2020 to $1,739 million. This drop may be indicative of external challenges impacting sales during that year. However, in 2021, operating revenue rebounded to $2,078 million, approaching levels seen in earlier years but not fully recovering to the 2018 peak.
Identifiable Assets
Identifiable assets demonstrated relative stability throughout the period, fluctuating minimally between $983 million and $1,054 million. After peaking at $1,054 million in 2017, assets slightly declined over the next three years, reaching a low of $983 million in 2020, before increasing again to $1,052 million in 2021. This pattern suggests consistent asset management with minor adjustments likely reflecting operational or strategic shifts.
Segment Asset Turnover
Segment asset turnover, calculated as operating revenue divided by identifiable assets, showed a generally decreasing trend over the first four years, dropping from 2.01 in 2017 to 1.77 in 2020. This decline indicates that the efficiency with which assets generated revenue weakened, particularly in 2020. However, there was a recovery in 2021, with the turnover rising to 1.98, approaching earlier levels. This improvement may reflect enhanced operational performance or improved asset utilization after a challenging 2020.

Overall, the segment faced a significant downturn in revenue and asset efficiency in 2020, likely driven by external factors impacting the business environment. The subsequent recovery in 2021 in both revenue and asset turnover suggests resilience and an ability to adapt, although the segment had not fully reached the prior peak revenue levels by the end of the period. The stable identifiable assets imply controlled investment and management of resources through varying market conditions.


Segment Asset Turnover: Test & Measurement and Electronics

Illinois Tool Works Inc.; Test & Measurement and Electronics; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


The "Test & Measurement and Electronics" segment demonstrates notable fluctuations in operating revenue over the five-year period. After an initial increase from 2069 million USD in 2017 to 2171 million USD in 2018, revenue showed a slight decline to 2121 million USD in 2019, followed by a more pronounced drop to 1963 million USD in 2020. Subsequently, revenue recovered significantly to 2346 million USD in 2021, reaching the highest level within the examined timeframe.

Identifiable assets within this segment exhibit a general downward trend from 2449 million USD in 2017 to 2239 million USD in 2020. This decline is interrupted in 2021 by a substantial increase to 3242 million USD, indicating a significant investment or revaluation of assets during that year.

The segment asset turnover ratio, which measures the efficiency of asset use in generating revenue, reflects some variability. After rising from 0.84 in 2017 to a peak of 0.93 in 2018, it decreases to 0.89 in 2019 and slightly further to 0.88 in 2020. In 2021, the ratio notably declines to 0.72, the lowest point in the observed period. This reduction suggests that despite the increased asset base, asset utilization efficiency has deteriorated in terms of revenue generation.

Operating Revenue
Overall growth with fluctuations, peaking in 2021 after a dip in 2020.
Identifiable Assets
General decline from 2017 to 2020, followed by a significant rise in 2021.
Segment Asset Turnover
Highest efficiency in 2018; gradually declining afterward, with a marked drop in 2021.

In summary, the segment experienced revenue volatility with a recovery in the final year, accompanied by asset expansion that outpaced revenue growth, as reflected in decreased asset turnover efficiency. This pattern may indicate recent strategic asset investments or changes in asset composition affecting operational efficiency.


Segment Asset Turnover: Welding

Illinois Tool Works Inc.; Welding; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


Operating Revenue
Operating revenue exhibited a generally fluctuating trend over the five-year span. It increased from 1,538 million USD in 2017 to a peak of 1,691 million USD in 2018. Subsequently, revenue declined to 1,638 million USD in 2019 and more sharply to 1,384 million USD in 2020. In 2021, there was a recovery, with revenue rising to 1,650 million USD, approaching the earlier peak levels.
Identifiable Assets
Identifiable assets showed a gradual decline from 756 million USD in 2017 to 700 million USD in 2020. However, in 2021, assets increased to 784 million USD, reaching the highest recorded value in the analyzed period. This suggests a reinvestment or acquisition activity in the final year examined.
Segment Asset Turnover
The segment asset turnover ratio showed variability while maintaining an overall range between approximately 1.98 and 2.23. It increased from 2.03 in 2017 to a high of 2.23 in 2019, indicating improved utilization of assets during that period. This was followed by a decrease to 1.98 in 2020, coinciding with the dip in revenue and assets, before recovering slightly to 2.10 in 2021. The pattern suggests asset efficiency is somewhat sensitive to revenue fluctuations.
Summary
Overall, the data indicates that the welding segment experienced revenue growth early in the period, followed by a significant decline in 2020, likely reflective of broader economic or market challenges. The rebound in 2021 points to a recovery phase. Asset levels followed a similar pattern with reduction through 2020 and growth in 2021, potentially signaling renewed investment. The asset turnover ratio reflected these changes, peaking when revenue and asset levels aligned favorably, and declining during the downturn. The trends collectively suggest the segment’s performance and asset utilization were affected by cyclical factors, with signs of resilience emerging by the end of the period.

Segment Asset Turnover: Polymers & Fluids

Illinois Tool Works Inc.; Polymers & Fluids; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


The annual data for the Polymers & Fluids segment reveals several key trends over the five-year period from 2017 to 2021.

Operating Revenue
The operating revenue remained constant at $1724 million from 2017 to 2018, followed by a gradual decline through 2019 and 2020, reaching a low of $1622 million. In 2021, a notable recovery occurred with revenue increasing to $1804 million, surpassing the initial 2017 level.
Identifiable Assets
The identifiable assets steadily decreased from $2067 million in 2017 to $1855 million in 2020. A slight increase was observed in 2021 with assets rising to $1881 million, although still below the 2017 figure. This indicates a general contraction in asset base over the period with a modest rebound in the final year.
Segment Asset Turnover
The segment asset turnover ratio exhibited a generally upward trend, starting at 0.83 in 2017 and increasing to 0.9 by 2019. There was a minor decline to 0.87 in 2020, followed by a significant improvement to 0.96 in 2021. This trend suggests increasing efficiency in using assets to generate revenue, particularly in the most recent year.

Overall, the segment experienced a dip in both revenue and assets through 2020, likely influenced by external factors impacting demand or operations. However, the improvement in asset turnover alongside a revenue increase in 2021 points to enhanced asset utilization and potentially more effective operational management during that period.


Segment Asset Turnover: Construction Products

Illinois Tool Works Inc.; Construction Products; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


Operating Revenue
The operating revenue for the segment showed slight fluctuations in the early years, ranging from 1,672 million USD in 2017 to a slight increase in 2018 at 1,700 million USD. This was followed by a decline to 1,625 million USD in 2019. A modest recovery occurred in 2020 with revenue increasing to 1,652 million USD. The most notable change took place in 2021, where operating revenue rose significantly to 1,945 million USD, indicating strong growth after a period of relative stability and small declines.
Identifiable Assets
The identifiable assets exhibited a mostly steady upward trend over the five-year period. Beginning at 1,196 million USD in 2017, assets decreased slightly to 1,167 million USD in 2018 and remained relatively stable in 2019 at 1,176 million USD. From 2020 onward, the segment experienced consistent asset growth, reaching 1,239 million USD in 2020 and rising further to 1,367 million USD in 2021. This suggests ongoing investment and asset accumulation during the latter years.
Segment Asset Turnover
The segment asset turnover ratio, which measures the efficiency of asset use to generate revenue, displayed a minor decline from 1.40 in 2017 to 1.33 in 2020, indicating a gradual reduction in asset utilization efficiency over this period. However, in 2021, the ratio rebounded to 1.42, surpassing the 2017 level. This recovery reflects enhanced efficiency in asset use, coinciding with the significant increase in operating revenue during 2021.

Segment Asset Turnover: Specialty Products

Illinois Tool Works Inc.; Specialty Products; segment asset turnover calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Operating revenue
Identifiable assets
Segment Activity Ratio
Segment asset turnover1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment asset turnover = Operating revenue ÷ Identifiable assets
= ÷ =


Operating Revenue
The operating revenue experienced a slight increase from 2017 (US$ 1,938 million) to 2018 (US$ 1,951 million), reflecting stability in sales. However, a noticeable decline occurred in 2019 and 2020, with revenues decreasing to US$ 1,825 million and US$ 1,660 million respectively. This downward trend suggests reduced demand or other operational challenges during that period. In 2021, operating revenue rebounded somewhat to US$ 1,854 million, indicating partial recovery.
Identifiable Assets
Identifiable assets showed a gradual downward trend over the analyzed period, beginning at US$ 1,721 million in 2017 and decreasing each year to reach US$ 1,635 million in 2020. A modest increase was observed in 2021, with assets rising to US$ 1,682 million. This pattern may indicate asset optimization or divestitures followed by reinvestment or acquisition activities near the end of the period.
Segment Asset Turnover
Segment asset turnover ratios reflect efficiency in using assets to generate revenue. The ratio increased slightly from 1.13 in 2017 to a peak of 1.16 in 2018, suggesting improved effectiveness. Subsequently, the ratio declined to 1.1 in 2019 and further to 1.02 in 2020, consistent with the decreased revenue and asset base. By 2021, it recovered to 1.1, indicating a return toward previous efficiency levels.
Overall Trends and Insights
The segment experienced a peak in performance around 2018, followed by declines in revenue and asset turnover in 2019 and 2020, suggesting operational or market challenges during those years. The recovery in 2021 across revenue, assets, and turnover ratio points to a positive directional shift. The partial rebound may reflect adaptation to external conditions, improved market demand, or better asset utilization. Nonetheless, none of the 2021 metrics fully surpass prior peak levels, indicating room for continued performance improvement.

Segment Capital Expenditures to Depreciation

Illinois Tool Works Inc., capital expenditures to depreciation by reportable segment

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


The analysis of the segment capital expenditures to depreciation ratios over the five-year period reveals several discernible trends across the various reportable segments.

Automotive OEM
The ratio exhibits a fluctuating pattern, starting at 1.32 in 2017 and peaking at 1.5 in 2018. Subsequently, there is a notable decline reaching a trough of 0.6 in 2020, followed by a partial recovery to 0.91 in 2021. This suggests variability in capital investments relative to asset depreciation, with a significant reduction during the 2019-2020 periods, possibly reflecting industry-specific cycles or strategic capital allocation changes.
Food Equipment
This segment shows more stability with ratios ranging from 0.6 to 0.85 over the period. The ratio increases slightly from 0.6 in 2017 to 0.85 in 2019, then experiences a slight decrease but remains relatively stable around the low 0.7s by 2021. This stability indicates consistent capital expenditure in relation to depreciation, maintaining asset base renewal without dramatic fluctuations.
Test & Measurement and Electronics
A generally upward trend is observed, starting at 0.25 in 2017 and gradually increasing to 0.56 by 2021, with a minor dip in 2020. The rising ratio suggests an increasing level of capital expenditures relative to depreciation, indicating potential expansion or investment in this segment's asset base.
Welding
The ratio increases from 0.61 in 2017 to above 1.0 in 2019, and remains above 1.0 through 2021, albeit with a slight decrease in 2021 to 1.04. Sustaining a ratio above 1.0 indicates capital expenditures consistently outpacing depreciation, reflecting ongoing asset growth and possibly modernization efforts within the segment.
Polymers & Fluids
This segment maintains a low but steady ratio, ranging narrowly between 0.18 and 0.24. The slight upward movement over time points to modest increases in capital expenditure relative to depreciation, consistent with cautious or incremental investment in fixed assets.
Construction Products
The ratio shows variability, increasing from 0.67 in 2017 to a peak of 1.0 in 2019, before dropping to 0.68 in 2020 and rising again to 0.94 in 2021. This pattern indicates fluctuating investment intensity relative to asset depreciation, suggesting periods of capital expansion interspersed with more conservative spending phases.
Specialty Products
The ratio generally trends upward from 0.7 in 2017 to a peak of 0.95 in 2019, followed by a decline to 0.68 in 2020 and a subsequent increase to 0.76 in 2021, demonstrating moderate fluctuations. This indicates varying levels of capital expenditure aligned with depreciation dynamics, reflecting adjustments in asset investment strategies.

Overall, the data highlights varying capital expenditure strategies across segments, with some, like Welding and Automotive OEM, displaying higher volatility and periods of investment exceeding depreciation, whereas others, such as Polymers & Fluids and Food Equipment, present more stable and conservative capital spending patterns relative to asset depreciation.


Segment Capital Expenditures to Depreciation: Automotive OEM

Illinois Tool Works Inc.; Automotive OEM; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


Plant and equipment additions
There is a noticeable fluctuation in plant and equipment additions over the five-year period. Starting at $147 million in 2017, the additions rose to a peak of $184 million in 2018. This was followed by a decline to $134 million in 2019 and a more significant drop to $79 million in 2020. The figure then partially recovered to $116 million in 2021, indicating some rebound in capital investments after the downturn in 2020.
Depreciation and amortization and impairment of intangible assets
The depreciation and amortization expense shows a relatively steady upward trend with minor fluctuations. It increased from $111 million in 2017 to $123 million in 2018 and slightly rose to $125 million in 2019. The expense peaked at $131 million in 2020 before slightly decreasing to $128 million in 2021, suggesting consistent asset utilization and some impairment considerations over the years.
Segment capital expenditures to depreciation ratio
The ratio of capital expenditures to depreciation presents a declining trend overall. Starting at 1.32 in 2017, it increased to 1.5 in 2018 but then fell sharply to 1.07 in 2019. The ratio continued to decline more significantly to 0.6 in 2020, reflecting reduced capital spending relative to asset aging or depreciation. A modest recovery to 0.91 in 2021 suggests a cautious increase in capital expenditures but still below depreciation levels, indicating an overall conservative approach to new investment in this segment.

Segment Capital Expenditures to Depreciation: Food Equipment

Illinois Tool Works Inc.; Food Equipment; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


Plant and equipment additions
The capital investment in plant and equipment showed an overall moderate increase from 27 million US dollars in 2017 to a peak of 35 million US dollars in 2019. However, after 2019, there was a slight decline, with additions dropping to 34 million in 2020 and further down to 30 million in 2021. This indicates that investment activities intensified up to 2019 but experienced a reduction in the following years.
Depreciation, amortization, and impairment of intangible assets
Depreciation and amortization expenses decreased from 45 million US dollars in 2017 to 41 million US dollars by 2019 and remained relatively stable at around 41-42 million US dollars through 2020 and 2021. This suggests a consistent depreciation expense with slight fluctuations, possibly reflecting the age and composition of the asset base.
Segment capital expenditures to depreciation ratio
The ratio of capital expenditures to depreciation increased significantly from 0.6 in 2017 to 0.85 in 2019, indicating a period where capital investment exceeded depreciation by a greater margin, suggesting asset base expansion. Post-2019, the ratio declined to 0.83 in 2020 and further down to 0.71 in 2021, indicating reduced capital expenditure relative to the depreciation charge. This trend might imply a slowdown in asset growth or a more conservative investment strategy in recent years.
Overall insights
The data reveals a cycle of rising investment in plant and equipment up to 2019, followed by a reduction through 2021. Depreciation expenses remained relatively stable, underscoring a steady asset base utilization. The capital expenditure to depreciation ratio's rise and subsequent decline aligns with these observations, highlighting a phase of asset expansion followed by tempered investment activity. These trends may reflect strategic adjustments to capital deployment or responses to broader economic conditions impacting the segment.

Segment Capital Expenditures to Depreciation: Test & Measurement and Electronics

Illinois Tool Works Inc.; Test & Measurement and Electronics; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


Plant and Equipment Additions
The annual investment in plant and equipment fluctuated over the five-year period. Starting at 23 million USD in 2017, it increased to a peak of 31 million USD in 2018. A decline followed in 2019 and 2020 to 26 million and 23 million USD respectively, before rising sharply to 37 million USD in 2021. This pattern suggests a fluctuating capital investment strategy with a significant increase in the most recent year.
Depreciation, Amortization, and Impairment of Intangible Assets
This expense shows a general downward trend from 2017 through 2021. Beginning at 92 million USD in 2017, it decreased steadily to 88 million USD in 2018, then dropped more markedly to 69 million USD in 2019. There was a slight recovery to 75 million USD in 2020, followed by a further decrease to 66 million USD in 2021. This reduction over time could indicate asset aging or amortization schedules leading to lower charges.
Segment Capital Expenditures to Depreciation Ratio
The ratio of capital expenditures to depreciation reveals notable shifts during the period. Starting at 0.25 in 2017, it increased consistently to 0.35 in 2018 and 0.38 in 2019. A decline to 0.31 occurred in 2020, but the ratio rose sharply to 0.56 in 2021, the highest across the five years. This suggests that capital spending outpaced depreciation significantly in 2021, possibly reflecting increased investment in long-term assets or modernization efforts.

Segment Capital Expenditures to Depreciation: Welding

Illinois Tool Works Inc.; Welding; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


Plant and equipment additions
The data shows a steady upward trend in additions to plant and equipment from 2017 through 2019, increasing from 17 million US dollars to 28 million US dollars. This upward trend then stabilizes in 2020 and 2021, maintaining values of 27 million US dollars in each year.
Depreciation and amortization and impairment of intangible assets
There is a gradual decline in depreciation, amortization, and impairment expenses from 28 million US dollars in 2017 to 24 million US dollars in 2020. In 2021, this figure experiences a slight rise to 26 million US dollars, indicating a modest increase after the previous downward trend.
Segment capital expenditures to depreciation ratio
The ratio of capital expenditures relative to depreciation shows a consistent increase over the period. Starting at 0.61 in 2017, the ratio rises annually to 1.13 in 2020, before slightly decreasing to 1.04 in 2021. This trend suggests a growing level of investment in capital expenditures relative to the depreciation expenses over the years, reaching a peak around 2020.
Overall observations
The overall capital investment in plant and equipment grew significantly in the initial years, then remained stable, while depreciation expenses slightly decreased before a minor rebound. The increasing capital expenditure to depreciation ratio over the period reflects a strategic emphasis on maintaining or expanding asset base relative to asset consumption and aging, particularly notable in the years preceding 2021.

Segment Capital Expenditures to Depreciation: Polymers & Fluids

Illinois Tool Works Inc.; Polymers & Fluids; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


Plant and Equipment Additions
The annual investments in plant and equipment remained relatively stable over the five-year period, fluctuating slightly between US$15 million and US$18 million. This consistency suggests a steady maintenance and potential incremental expansion in physical assets within the segment.
Depreciation, Amortization, and Impairment of Intangible Assets
There is a clear downward trend in depreciation and amortization expenses, decreasing from US$89 million in 2017 to US$62 million in 2021. This decline could indicate aging assets fully depreciated over time or a reduction in the intangible asset base, leading to lower ongoing amortization charges.
Segment Capital Expenditures to Depreciation Ratio
The ratio of capital expenditures to depreciation has generally increased over the reviewed period, moving from 0.18 in 2017 to 0.24 in 2021. This upward trend indicates that capital investments have gradually grown in proportion to the depreciation expenses, which may reflect efforts to sustain or enhance the segment’s asset base relative to the rate at which assets are expensed.

Segment Capital Expenditures to Depreciation: Construction Products

Illinois Tool Works Inc.; Construction Products; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


The analysis of the "Construction Products" segment over the five-year period from 2017 to 2021 reveals several notable trends related to capital expenditures and asset depreciation.

Plant and Equipment Additions
The annual investments in plant and equipment showed fluctuations over the period. Starting at $22 million in 2017, the additions increased moderately to $25 million in 2018 and further to $29 million in 2019. However, there was a decline in 2020, with additions dropping to $21 million, likely reflecting cautious capital deployment during that year. The figure rebounded strongly in 2021, reaching the highest level in the five-year span at $30 million.
Depreciation and Amortization and Impairment of Intangible Assets
Depreciation and amortization expenses remained relatively stable throughout the period. The amount decreased slightly from $33 million in 2017 to $29 million in 2019. In 2020 and 2021, the values increased moderately again to $31 million and $32 million, respectively. This pattern suggests a consistent recognition of asset wear and amortization, with minor variations potentially influenced by changes in asset base or impairment charges.
Segment Capital Expenditures to Depreciation Ratio
This ratio reflects the relationship between investments in plant and equipment and the depreciation charge. The ratio started at 0.67 in 2017, indicating that capital expenditures were approximately two-thirds of depreciation costs. It rose steadily to 0.78 in 2018 and reached parity in 2019, showing capital spending matching depreciation expense and signaling potential maintenance or modest growth. In 2020, the ratio dropped to 0.68, aligning with the lower capital additions observed that year. By 2021, the ratio increased again to 0.94, indicating a near match between investments and asset consumption, highlighting a strategic emphasis on asset renewal or expansion.

Overall, the data illustrates a segment that experienced moderate investment growth with a temporary slowdown in 2020, potentially due to external market conditions. Depreciation expenses remained largely consistent, and the capital expenditure to depreciation ratio signals an approach balancing asset maintenance with cautious growth initiatives, culminating in a notable rebound of capital spending by 2021.


Segment Capital Expenditures to Depreciation: Specialty Products

Illinois Tool Works Inc.; Specialty Products; segment capital expenditures to depreciation calculation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Plant and equipment additions
Depreciation and amortization and impairment of intangible assets
Segment Financial Ratio
Segment capital expenditures to depreciation1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Segment capital expenditures to depreciation = Plant and equipment additions ÷ Depreciation and amortization and impairment of intangible assets
= ÷ =


Plant and Equipment Additions
The data shows that plant and equipment additions fluctuated over the five-year period. Additions increased from 45 million USD in 2017 to a peak of 58 million USD in 2018, followed by a slight decline to 56 million USD in 2019. A noticeable decrease occurred in 2020, reaching 36 million USD, the lowest value in the period. There was a rebound in 2021 with additions rising to 41 million USD, though the figure remained below the earlier peak years.
Depreciation, Amortization, and Impairment of Intangible Assets
Depreciation and amortization expenses showed a gradually declining trend throughout the period. Beginning at 64 million USD in 2017 and remaining stable in 2018, the amount decreased to 59 million USD in 2019, then further declined to 53 million USD in 2020. In 2021, there was a slight increase to 54 million USD, but overall, the trend indicates a reduction in these expenses over the period.
Segment Capital Expenditures to Depreciation Ratio
This ratio experienced variability reflecting changes in capital expenditure relative to depreciation. Starting from 0.7 in 2017, the ratio rose significantly to 0.91 in 2018 and reached its highest point at 0.95 in 2019. However, it dropped sharply to 0.68 in 2020, consistent with the decline in capital expenditures. There was a slight improvement to 0.76 in 2021, indicating a modest recovery in capital spending relative to depreciation.
Overall Observations
The data reflect a period of initial investment increase up to 2019, followed by a contraction in 2020, likely impacted by broader economic conditions. Depreciation and amortization expenses were on a general downward trend, suggesting either a reduction in capital assets or changes in asset lives or impairment. The capital expenditure to depreciation ratio pattern aligns with these trends, showing reduced investment intensity in recent years but a partial recovery after 2020. Collectively, the trends indicate cautious capital deployment behavior in the specialty products segment with an emphasis on managing depreciation expenses.

Operating revenue

Illinois Tool Works Inc., operating revenue by reportable segment

US$ in millions

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products
Intersegment revenue
Total

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


The annual reportable segment operating revenue data reveals several notable trends across the periods analyzed.

Automotive OEM
Revenue in this segment increased slightly from 2017 to 2018, followed by a decline in 2019 and a more pronounced drop in 2020. There was a moderate recovery in 2021, but the revenue did not return to the earlier peak levels.
Food Equipment
This segment showed steady growth from 2017 to 2018, then a slight decline in 2019. A significant decrease occurred in 2020, likely reflecting broader economic challenges, before revenues partially rebounded in 2021, though still below 2018 levels.
Test & Measurement and Electronics
The trend for this segment was generally positive with gradual increases from 2017 through 2019. There was a decline in 2020, mirroring overall downturns, but a strong recovery in 2021 led to the highest revenue in the five-year span.
Welding
Revenues grew from 2017 to 2018, followed by a slight decline in 2019. A sharper decrease occurred in 2020, but the segment recovered in 2021 to nearly match 2018 levels, indicating resilience in the segment.
Polymers & Fluids
This segment maintained relatively stable revenues from 2017 through 2018, with a gradual decline in 2019 and 2020. A moderate increase in 2021 suggests a positive turnaround after periods of contraction.
Construction Products
Revenue in this segment experienced modest growth from 2017 through 2018, followed by a slight decline in 2019. Unlike many other segments, 2020 saw a small increase, and 2021 delivered a significant jump, resulting in the highest revenue recorded in this timeframe.
Specialty Products
After incremental growth between 2017 and 2018, this segment saw a decline in 2019 and a further decrease in 2020. The 2021 revenues showed recovery but remained below the 2018 peak.
Intersegment Revenue
These values, consistently negative, indicate minor reductions in intersegment revenue across all periods, with little variation overall.
Total Revenue
The total operating revenue peaked in 2018, followed by declines in 2019 and 2020. The largest drop occurred between 2019 and 2020, likely reflecting widespread operational challenges. However, 2021 saw a considerable overall recovery, nearly reaching the 2018 level, driven by rebounds in several key segments such as Test & Measurement and Electronics, Construction Products, and Food Equipment.

Operating income

Illinois Tool Works Inc., operating income by reportable segment

US$ in millions

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products
Unallocated
Total

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


The operating income data shows varied performance across different segments over the analyzed five-year period.

Automotive OEM
This segment experienced a decline from 747 million USD in 2017 to 659 million USD in 2019, followed by a sharp drop to 457 million USD in 2020. A partial recovery occurred in 2021, rising to 545 million USD but still below the initial 2017 level.
Food Equipment
Operating income remained relatively stable between 2017 and 2019, fluctuating around the mid-500 million USD range. In 2020, there was a notable decrease to 342 million USD, with a subsequent rebound to 469 million USD in 2021, indicating resilience amid adversity.
Test & Measurement and Electronics
This segment showed a consistent upward trend with operating income increasing from 464 million USD in 2017 to 542 million USD in 2019. A minor decline occurred in 2020, but it sharply recovered and exceeded previous levels in 2021, reaching 643 million USD, the highest among all segments.
Welding
After growth from 415 million USD in 2017 to 474 million USD in 2018, there was a decline in 2019 and a more pronounced decline in 2020 to 376 million USD. In 2021, the segment rebounded to 490 million USD, surpassing the 2017 figure.
Polymers & Fluids
This segment demonstrated steady growth throughout the period, increasing from 357 million USD in 2017 to 402 million USD in 2020, and further to 457 million USD in 2021, indicating solid performance.
Construction Products
Operating income showed minor fluctuations from 399 million USD in 2017, dipping to 383 million USD in 2019. However, a positive trend emerged in the last two years, with figures rising to 421 million USD in 2020 and significantly to 530 million USD in 2021.
Specialty Products
This segment experienced a gradual decline from 527 million USD in 2017 to 472 million USD in 2019 and further down to 432 million USD in 2020. In 2021, it regained some ground rising to 504 million USD but remained below the initial levels.
Unallocated
Reported values were notably negative from 2018 onward, with losses increasing from -41 million USD in 2018 to -161 million USD in 2021, indicating growing costs or expenses not directly tied to any segment.
Total Operating Income
Total operating income peaked in 2018 at 3,584 million USD. This was followed by a decline to 3,402 million USD in 2019 and a sharper decrease to 2,882 million USD in 2020, reflecting the impact of global disruptions. In 2021, a recovery occurred with total operating income rising to 3,477 million USD, approaching pre-pandemic levels.

Overall, the data reflects the significant impact of external factors on most segments in 2020, with a partial to strong recovery in 2021. Segments tied to technology and industrial products, specifically Test & Measurement and Electronics as well as Polymers & Fluids, exhibited resilience and growth across the period. In contrast, segments more directly dependent on automotive and specialty industrial markets showed more volatility and slower recovery. The increase in unallocated losses suggests rising overhead or restructuring costs impacting overall profitability. The total operating income trend corroborates these observations, revealing a trough in 2020 followed by a notable rebound.


Depreciation and amortization and impairment of intangible assets

Illinois Tool Works Inc., depreciation and amortization and impairment of intangible assets by reportable segment

US$ in millions

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products
Total

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


Overall Depreciation, Amortization, and Impairment Trend
The total depreciation and amortization expense, along with impairment of intangible assets, displayed a downward trend over the five-year period. Starting at $462 million in 2017, the total amount remained relatively stable through 2018 at $461 million but then decreased significantly to $426 million in 2019. The values for 2020 and 2021 remained close to those levels, at $427 million and $410 million respectively, indicating a gradual decline overall.
Automotive OEM Segment
The Automotive OEM segment saw a general increase from 2017 to 2020, rising from $111 million to $131 million. However, in 2021, the depreciation and amortization expense slightly declined to $128 million. This segment demonstrated relative stability with moderate fluctuations, maintaining a leading position in terms of expense amounts compared to other segments.
Food Equipment Segment
Expenses in the Food Equipment segment were relatively stable throughout the period, fluctuating narrowly between $41 million and $45 million. There was a small decline from $45 million in 2017 to $41 million in 2019 and 2020, followed by a slight recovery to $42 million in 2021.
Test & Measurement and Electronics Segment
This segment experienced a noticeable decline from $92 million in 2017 to $66 million in 2021, with the lowest point observed in 2019 at $69 million. A temporary increase occurred in 2020 to $75 million, but the overall trend indicates decreasing amortization and impairment costs in this segment.
Welding Segment
The Welding segment showed minor fluctuations, with a gradual decrease from $28 million in 2017 to $24 million in 2020, followed by a slight increase to $26 million in 2021. These small changes suggest a relatively stable expense profile.
Polymers & Fluids Segment
A clear downward trend is evident in the Polymers & Fluids segment, starting at $89 million in 2017 and declining steadily each year to $62 million by 2021. This represents the most significant decrease among the segments analyzed and may reflect changes in asset base, impairment charges, or amortization policies.
Construction Products Segment
The Construction Products segment exhibited overall stability, with minor fluctuations from $33 million in 2017, slightly decreasing to $29 million in 2019, then incrementally rising again to $32 million in 2021. These changes appear marginal and do not suggest a strong trend.
Specialty Products Segment
This segment demonstrated a decline from $64 million in 2017 and 2018 to $53 million in 2020, followed by a modest increase to $54 million in 2021. The trend indicates a mild reduction in depreciation and amortization expenses over the period, with partial recovery toward the end.

Plant and equipment additions

Illinois Tool Works Inc., plant and equipment additions by reportable segment

US$ in millions

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products
Total

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


The analysis of plant and equipment additions across the reported segments reveals distinct trends over the five-year period. The total expenditures demonstrate fluctuation, with a peak in 2018 and a significant decline in 2020, followed by a recovery in 2021.

Automotive OEM
This segment shows notable variability, starting at 147 million in 2017, rising to a peak of 184 million in 2018. A decline follows, reaching the lowest point of 79 million in 2020, then recovering to 116 million in 2021. The fluctuations suggest sensitivity to market or operational conditions affecting capital investment in this area.
Food Equipment
Spending in this segment remains relatively stable, fluctuating between 27 million and 35 million. The highest addition was in 2019 (35 million), with a slight decline thereafter but no dramatic shifts, indicating consistent investment levels.
Test & Measurement and Electronics
The segment exhibits some variation, with a gradual increase overall. After starting at 23 million in 2017, it peaks at 37 million in 2021. Minor decreases are observed mid-period, but the upward trend by the end suggests expanding capital investment in this segment.
Welding
Capital additions increase steadily from 17 million in 2017 to 28 million in 2019, then stabilize around 27 million in the subsequent years. This indicates a growth phase followed by a plateau in investment.
Polymers & Fluids
Investment remains stable, spanning 15 million to 18 million throughout the period, with no clear upward or downward trend, reflecting consistent expenditure levels.
Construction Products
This segment shows moderate variability, ranging from 21 million to 30 million. After rising from 22 million in 2017 to 29 million in 2019, investments decrease in 2020 but recover by 2021, indicating some sensitivity to external factors but relatively quick recovery.
Specialty Products
The data reveals an increase from 45 million in 2017 to 58 million in 2018, followed by a decline to 36 million in 2020, and a partial recovery to 41 million in 2021. This pattern mirrors the broader trend of an investment peak in 2018 and a dip during 2020.
Total
Overall capital additions demonstrate a peak in 2018 at 364 million, followed by a decrease to 236 million in 2020, which aligns with the general dip in acquisitions noted in multiple segments. The total rebounds to 296 million in 2021, though it does not reach the previous peak, indicating cautious re-expansion in capital expenditures.

Identifiable assets

Illinois Tool Works Inc., identifiable assets by reportable segment

US$ in millions

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Automotive OEM
Food Equipment
Test & Measurement and Electronics
Welding
Polymers & Fluids
Construction Products
Specialty Products
Corporate
Total

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).


Automotive OEM
The identifiable assets in this segment showed a slight decline over the five-year period, decreasing from 2402 million USD in 2017 to 2260 million USD in 2021. The values remained relatively stable between 2017 and 2019 but experienced a gradual decline from 2020 onward.
Food Equipment
This segment's assets were somewhat volatile, with a decrease from 1054 million USD in 2017 to a low of 983 million USD in 2020, followed by a recovery to 1052 million USD in 2021, essentially returning to the 2017 level.
Test & Measurement and Electronics
There was a notable pattern in this segment, where assets decreased steadily from 2449 million USD in 2017 to 2239 million USD in 2020, followed by a significant increase to 3242 million USD in 2021, marking the highest value across the observed years.
Welding
Assets in the welding segment fluctuated modestly, rising from 756 million USD in 2017 to 789 million USD in 2018, then declining to 700 million USD in 2020 before rebounding to 784 million USD in 2021. Overall, the segment ended slightly higher in 2021 compared to 2017.
Polymers & Fluids
This segment exhibited a steady decline in identifiable assets from 2067 million USD in 2017 to 1855 million USD in 2020, with a slight increase to 1881 million USD in 2021. The overall trend indicates a moderate reduction over the period.
Construction Products
In contrast to many other segments, construction products showed a consistent increase in assets, rising from 1196 million USD in 2017 to 1367 million USD in 2021, suggesting progressive growth throughout the period.
Specialty Products
The assets in specialty products experienced a gradual decline from 1721 million USD in 2017 to 1635 million USD in 2020, with a slight recovery to 1682 million USD in 2021. The trend indicates relative stability with a mild downward bias.
Corporate
Corporate assets fluctuated significantly, with a steep decrease from 5135 million USD in 2017 to 3535 million USD in 2018, followed by recovery phases reaching 4659 million USD in 2020, and dipping again to 3809 million USD in 2021. These variations suggest changes in corporate-level asset allocation or structure.
Total
Total identifiable assets declined markedly from 16780 million USD in 2017 to 14870 million USD in 2018, then showed a recovery trend to 16077 million USD in 2021. Despite this recovery, the total assets remain below the 2017 peak, reflecting overall asset reduction offset by later increases.