Press Release

ITW Reports Diluted Net Income Per Share of 89 Cents in the 2007 Third Quarter; Revenues Increased 16 Percent, Net Income Grew 10 Percent and Diluted Net Income Per Share was 14 Percent Higher in the Quarter

October 17, 2007

GLENVIEW, ILLINOIS - (October 17, 2007) - Illinois Tool Works Inc. (NYSE:ITW) today reported 14 percent growth in diluted net income per share in the 2007 third quarter. Diluted net income per share was $0.89 versus $0.78 in the 2006 third quarter. Additionally, the Company's third quarter net income increased 10 percent.

The double-digit growth in third quarter earnings per share was in part due to ongoing strength from a broad variety of international end markets tempered by weaker North American end market activity. Total Company revenues increased 15.7 percent in the quarter. While total base revenues grew 2.2 percent in the quarter, international base revenues increased 5.1 percent and North American base revenues were up modestly. Even with slower North American end markets, the Company's North American base revenue growth rate improved 160 basis points from the 2007 second quarter. Also, acquisitions net of divestitures added 10.3 percent of growth to revenues while translation contributed 3.8 percent. Other income decreased $16.8 million from the year ago period as a result of lower investment income.

For the 2007 third quarter, revenues were $4.094 billion versus $3.538 billion for the prior year period. Third quarter operating income improved to $696.3 million from $626.9 million a year ago. Net income was $491.1 million compared to $446.1 million in the prior year period. The Company's third quarter operating margins of 17.0 percent were 70 basis points lower than the year-ago period due to the significantly higher levels of acquisitions in the last half of 2006 and thus far in 2007. Excluding acquisitions, third quarter base margins improved 60 basis points versus the prior year period.

For the 2007 nine months, revenues increased 15 percent, operating income grew 8 percent, net income rose 9 percent and diluted net income per share was 12 percent higher than the year-ago period. Operating revenues were $12.013 billion versus $10.415 billion for the prior year period. Operating income improved to $1.964 billion from $1.827 billion a year ago. Net income was $1.399 billion compared to $1.278 billion and diluted net income per share was $2.50 versus $2.24 in the prior year period. The Company's 2007 nine month operating margins of 16.3 percent were 120 basis points lower than the year earlier period.

The Company's free operating cash flow was a strong $656 million in the third quarter. This cash was utilized to acquire 18 companies in the most recent quarter representing $218 million of annualized revenues. Through September 30, the Company acquired 37 companies totaling $830 million of annualized revenues and in aggregate paid less than one times revenues. In the third quarter, the Company also repurchased $479 million of shares as part of its open-ended buyback program. Year to date, the Company has spent a total of $959 million to repurchase shares.

"Despite continued headwinds in a number of North American end markets, we capitalized on stronger international end markets and our 80/20 operating discipline to post double-digit earnings growth for the quarter," said David B. Speer, chairman and chief executive officer. "We continue to be optimistic about our acquisition opportunities and, as a result, we have modified our acquisition range to $1.0 billion to 1.2 billion of annualized revenues for the full year."

Segment highlights include:

North American Engineered Products third quarter revenues increased 2.4 percent as base revenues declined 1.7 percent and acquisitions net of divestitures added 3.7 percent. Base revenue performance improved in the quarter versus the second quarter largely due to better than expected North American automotive base revenues and easier comparables. In the quarter, automotive base revenues increased 2 percent thanks largely to better builds by the Detroit 3 and the New Domestics. As a result of ongoing weakness in housing construction, North American construction base revenues declined 5 percent. Operating income declined 3.2 percent as base income fell 5.0 percent mainly due to weak construction results. As a result, operating margins of 16.6 percent were 100 basis points lower than the year ago period. For the 2007 nine months, revenues grew 0.6 percent, operating income declined 7.3 percent and operating margins of 16.5 percent were 140 basis points lower than a year ago.

International Engineered Products third quarter revenues and operating income increased 32.5 percent and 28.3 percent, respectively. Revenues grew dramatically as base revenues contributed 6.7 percent and acquisitions net of divestitures added 16.7 percent. Translation contributed 9.2 percent to the top line. Both base revenues and base operating income largely benefited from contributions from the construction and automotive business units. Operating margins of 14.7 percent were 50 basis points lower than the year ago period due to the dilutive impact of acquisitions. For the 2007 nine months, revenues increased 32.8 percent, operating income grew 30.5 percent and operating margins of 14.0 percent were 20 basis points lower than the year earlier period.

North American Specialty Systems third quarter revenues increased 10.5 percent mainly due to an 8.3 percent contribution from acquisitions net of divestitures. Base revenues added 1.9 percent to the top line largely due to the food equipment and welding business units. Operating income growth of 7.3 percent was primarily due to base income contributions from welding and food equipment. Operating margins of 19.4 percent were 60 basis points lower than the year earlier period due to the dilutive effect of acquisitions. For the 2007 nine months, revenues increased 9.9 percent, operating income grew 3.6 percent and operating margins of 18.9 percent were 110 basis points lower than the year ago period.

International Specialty Systems third quarter revenues increased 26.3 percent. The significant growth in revenues was due primarily to a 15.0 percent contribution from acquisitions net of divestitures. Base revenues contributed 3.6 percent and translation added 7.6 percent to the top line. Base revenues largely benefited from growth from the food equipment business units. Operating income increased 25.3 percent as base income growth of 10.5 percent was attributable to the food equipment, test and measurement, and welding businesses. Operating margins of 14.4 percent were 10 basis points lower than the year ago period. For the 2007 nine months, revenues increased 29.0 percent, operating income grew 22.1 percent and operating margins of 12.9 percent were 80 basis points lower that the year earlier period.

Looking ahead, the Company is forecasting a 2007 fourth quarter diluted earnings per share range of $0.86 to $0.90 and a full-year range of $3.36 to $3.40. Total Company base revenues are expected to grow in a range of 2.1 percent to 4.1 percent in the fourth quarter and 1.9 percent to 2.5 percent for the full year. If the Company achieves the midpoints of these forecasted ranges, the diluted earnings per share growth would be 14 percent for the fourth quarter and 12 percent for the full year.

This Earnings Release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitations, statements regarding end market conditions, base revenue growth, earnings growth, operating income, other income, acquisitions, use of free cash and the Company's related forecasts. These statements are subject to certain risks, uncertainties and other factors which could cause actual results to differ materially from those anticipated. Important factors that could cause actual results to differ materially from the Company's expectations are set forth in ITW's Form 10-Q for the 2007 second quarter.

ITW is a $14.1 billion in revenues diversified manufacturer of highly engineered components and industrial systems and consumables. The Company consists of approximately 750 business units in 49 countries and employs some 55,000 people.

CONTACT: John Brooklier, 847-657-4104 or jbrooklier@itw.com