CLEVELAND, Feb. 4 /PRNewswire-FirstCall/ -- Parker Hannifin Corporation
(NYSE: PH), the global leader in motion and control technologies, has been
notified that the European Commission (EC) is imposing a fine of 25.6 million
euros (approximately $32.9 million), in connection with its investigation of
whether Parker's ITR subsidiary, acquired in 2002, violated the competition
laws of the European Union commencing in 1986. The fine results from an
investigation of a business unit of ITR that manufactures marine hose,
typically used in oil exploration. Parker fully cooperated with the
investigation. The business unit had revenues of approximately $15 million
when acquired.
"The problems that were uncovered started long before Parker acquired this
small, Italian company and were concealed from Parker," said Tom Piraino, Vice
President, General Counsel and Secretary. "We are disappointed in the
magnitude of the fine imposed by the EC, particularly given our quick response
to the problems we encountered and cooperation with the EC investigation,
which underscores our commitment to ethical business practices and sound
stewardship. Particularly disappointing is the portion of the fine that the
EC chose to impose for the period prior to Parker's acquisition of the
business. We are evaluating all of our options, including an appeal of this
EC decision."
With annual sales exceeding $12 billion, Parker Hannifin is the world's
leading diversified manufacturer of motion and control technologies and
systems, providing precision-engineered solutions for a wide variety of
mobile, industrial and aerospace markets. The company employs approximately
62,000 people in 48 countries around the world. Parker has increased its
annual dividends paid to shareholders for 52 consecutive years, among the top
five longest-running dividend-increase records in the S&P 500 index. For more
information, visit the company's web site at http://www.parker.com, or its
investor information site at http://www.phstock.com.
Forward-Looking Statements
Forward-looking statements contained in this and other written and oral
reports are made based on known events and circumstances at the time of
release, and as such, are subject in the future to unforeseen uncertainties
and risks. All statements regarding future performance, earnings projections,
events or developments are forward-looking statements. It is possible that the
future performance and earnings projections of the company and individual
segments may differ materially from current expectations, depending on
economic conditions within its mobile, industrial and aerospace markets, and
the company's ability to maintain and achieve anticipated benefits associated
with announced realignment activities, strategic initiatives to improve
operating margins, actions taken to combat the effects of the current
recession, and growth, innovation and global diversification initiatives. A
change in economic conditions in individual markets may have a particularly
volatile effect on segment results. Among the other factors which may affect
future performance are: changes in business relationships with and purchases
by or from major customers or suppliers, including delays or cancellations in
shipments or significant changes in financial condition; uncertainties
surrounding timing, successful completion or integration of acquisitions;
threats associated with and efforts to combat terrorism; uncertainties
surrounding the ultimate resolution of outstanding legal proceedings,
including the outcome of any appeals; competitive market conditions and
resulting effects on sales and pricing; increases in raw material costs that
cannot be recovered in product pricing; the company's ability to manage costs
related to employee retirement and health care benefits and insurance; and
global economic factors, including manufacturing activity, air travel trends,
currency exchange rates, difficulties entering new markets and general
economic conditions such as inflation, deflation, interest rates and credit
availability. The company makes these statements as of the date of this
disclosure, and undertakes no obligation to update them.
