By H. Will Racke

Illinois Tool Works Inc. managed to beat earnings expectations for the fourth quarter even as profits remained flat amid a challenging market for industrial goods.

In the latest quarter, the Glenview, Ill.-based manufacturing conglomerate posted net income of $450 million, or $1.23 per diluted share, in a performance that was identical to the $450 million, or $1.17 a share, it earned in the same period a year before. Per share earnings were 6 cents higher in the latest quarter thanks to a 6 percent reduction in shares outstanding, to 365.9 million.

Quarterly operating revenues totaled $3.26 billion, a slide of 6.5 percent from the previous year’s final quarter sales of $3.50 billion. Company officials attributed the decline to unfavorable foreign currency translation due to the strong U.S. dollar. ITW derives more than half its sales from outside the U.S.

“Stable demand across our business portfolio and solid execution showed strong Q4 performance,” said CFO Michael Larsen in a Wednesday morning conference call with analysts.

ITW’s latest per-share earnings topped by 3 cents the $1.20 analysts surveyed by Yahoo Finance had been anticipating.

The company held the line on profits despite a drop in overall sales largely through its restructuring efforts. That revamping program translated to a quarterly operating margin of 20.7 percent, a full percentage point better than the fourth quarter of 2014.

While slowing demand for industrial equipment hurt its construction and welding segments, ITW managed to generate organic growth in its consumer-facing segments such as automotive and food products.

ITW has “been in a sluggish growth environment, but their organic growth rate is still in the low single digits,” said Tom Hayes, a securities analyst for Northcoast Research. “Sales were stronger than expected in several categories, automotive being one.”

In the past, ITW has often boosted its sales growth through the acquisition of new companies and brands. As part of its new business strategy, however, it plans to slim down its product line and concentrate more on organic growth from increased sales within its existing businesses.

“In 2015, we began our pivot to focus on our organic growth agenda, and we made meaningful progress,” said CEO Scott Santi during the conference call.

Though he remains neutral on ITW, Hayes saw potential for the company to continue to boost its earnings numbers by further streamlining costs and taking advantage of any rebound in the industrial economy. “With better growth rates and the benefits of initiatives to run the company better, we will see EPS growth,” he said.

ITW annual earnings per share (in U.S. dollars)

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Looking to the year ahead, ITW estimated full-year EPS between $5.35 and $5.55. That range was consisted with the current Bloomberg consensus forecast of $5.41 for 2016.

For all of 2015, the company’s profits totaled $1.90 billion, or $5.13 per share, compared to $2.95 billion, or $7.28 a share, for the previous year. Full-year revenue declined 7.4 percent to $13.41 billion from $14.48 billion in 2014.

In late-afternoon trading Wednesday, ITW shares were trading up $1.84, or 2.2 percent, at $86.1.