Rockwell Automation Announces Further Cost Reductions

    MILWAUKEE--Sept. 25, 2001--Rockwell Automation today announced plans to eliminate an additional 750 jobs worldwide due to the continued decline in demand in global industrial automation markets.
    Don Davis, Rockwell Automation's Chairman and Chief Executive Officer, said: "These are painful actions, but we are operating in a very difficult and uncertain economic environment. We are committed to maintaining our competitive strength during this unprecedented industry slowdown by balancing the appropriate level of cost reduction with investments for future growth."
    The company expects that these actions will achieve net cost savings of approximately $50 million in fiscal year 2002 after taking into account the costs associated with strategic investments in expanded offerings for value added services and manufacturing solutions. The charge related to this reduction will be largely offset by an $18 million gain realized in the fourth quarter in connection with a favorable patent infringement settlement.
    Sales in the fourth quarter ending September 30, 2001 are expected to be down approximately 4% from third quarter 2001 levels. As a result, earnings per share for the fourth quarter are expected to be in the range of 5 to 7 cents, resulting in full year earnings per share of 91 to 93 cents.
    In light of the continuing weak manufacturing environment and increasingly uncertain market conditions, it is very difficult to make a meaningful projection of fiscal year 2002 results. Assuming a further 4% sales decline, earnings per share in the first quarter of fiscal year 2002 are expected to be modestly higher than fourth quarter earnings.