Illinois Tool Works narrows 2023 profit forecast on expected hit from UAW strikes
Oct 24 (Reuters) - Illinois Tool Works on Tuesday narrowed its full-year profit forecast, as it expects United Auto Workers strikes to dent demand for its automotive parts in North America.
The company manufactures industrial equipment that caters to clients in the automotive, construction and food equipment industries across the globe.
The Illinois-based company now expects its full-year profit to range between $9.65 and $9.85 per share, compared with its prior expectations of $9.55 to $9.95.
The company's 2023 profit outlook includes a hit of 12 cents per share in the fourth quarter due to the UAW's coordinated labor action.
More than 40,000 union members working at Ford, General Motors and Stellantis are now on strike since the walkouts began on Sept. 15.
If the issue remains unresolved, the strike could impact organic growth of the automotive segment of Illinois Tool Works by about 3% to 5% in the fourth quarter, according to analysts at J.P Morgan.
Businesses ranging from airlines to auto parts makers are starting to feel the heat from the strike by hourly workers at the Detroit Three automakers.
Illinois Tool Works reported operating revenue of $4.03 billion for third quarter ended Sept. 30, up 0.5% from a year earlier. Analysts on average had expected $4.09 billion, as per LSEG data.
The company posted a profit of $2.55 per share, compared with Wall street expectations of $2.46 per share. (Reporting by Aishwarya Jain; Editing by Maju Samuel)
