06 Industrial Automation

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Industrial AutomationIndustrial Automation

Investor UpdateInvestor Update

Safe Harbor Statement

Our commentary and responses to your questions may contain forward-looking statements, including our outlook for the remainder of the year and Emerson undertakes noobligation to update any such statement to reflect later developments. Information on factors that could cause actual results to vary materially from those discussed today isavailable in our most recent Annual Report on Form 10-K as filed with the SEC.

Non-GAAP Measures

In this presentation we will discuss some non-GAAP measures (denoted with *) in talking about our companys performance, and the reconciliation of those measures to the mostcomparable GAAP measures is included in the back of this presentation or contained within this presentation.

Jean-Paul MontupetExecutive Vice President

February 8, 2008


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10%

8%

41%

41%

Industrial Automation SummaryIndustrial Automation SummaryIndustrial Automation Summary

22%7%

13%

18%

22%

18%FluidAutomation

PowerGeneration

PowerDistribution

Motors &Drives

MechanicalPower

Transmission

2007 Sales by Product

2007 Sales by Geography

UnitedStates

ROW

Asia

Europe

IndustrialEquipment

2005 2006 2007 CAGR

Sales $3.2B $3.8B $4.3B 14.8%

Earnings $0.5B $0.6B $0.7B 19.7%

% of Sales 14.3% 15.1% 15.6%

2005-07

Global Manufacturing Facilities

United States/Canada 30

Europe 35

Asia 10Latin America 10

% Best Cost ~25%


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Emerson Industrial AutomationEmerson Industrial AutomationEmerson Industrial Automation

Gears Bearings Couplings Components

Mechanical Power Transmission Motors & Drives

Genset Alternators

Solenoid Valves Controls Pneumatics

Fluid Automation Components HeatingCable

Wind & HydroGenerators

Ultrasonics Cleaning Plastic Joining Transformers Lighting

Industrial Equipment Electrical Distribution

Power Generation Industrial Automation
http://www.nelsonheaters.com/Products/Heaters/Cables/Limitrace.htmhttp://www.nelsonheaters.com/Products/Heaters/Cables/Limitrace.htm


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Industrial Automation - Key MessagesIndustrial AutomationIndustrial Automation--Key MessagesKey Messages Improved through-the-cycle underlying growth from

2 - 4% to 3 - 5% Increased Presence in Power Generation, with sustainable

higher long term growth rate Increased participation in faster growing segments of the

Industrial Automation Market

Energy Saving Products

Hazardous Environment Products Variable Speed Drives

Fluid Automation

Growing participation in Emerging Markets

Success in the Power Generation segment worldwidecontinues to be one of the main growth drivers

Continued focus on emerging markets Increasing the pace of new product development Positioned to expand in the Automation space Asset Management has generated strong cash flow


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Key Industrial Automation Growth DriversKey Industrial Automation Growth DriversKey Industrial Automation Growth Drivers

Energy Savings EmergingMarkets

Fluid Automation Variable Speed DrivesHazardous Environment

Solutions

Power Generation

% of Total Sales

8%14%

20%

20022007

2012F


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Industrial Automation Key MessagesIndustrial Automation Key MessagesIndustrial Automation Key Messages

Improved through-the-cycle underlying growth from2 - 4% to 3 - 5%

Success in the Power Generation segment

worldwide continues to be one of the main growthdrivers

5-year growth CAGR: 20.2%

Caterpillar contract renewed through 2012 Continuing to grow with Caterpillar, other gensetmanufacturers worldwide and in other power generationsegments: renewable energies (wind, hydro) and marine

Continued focus on emerging markets Increasing the pace of new product development

Positioned to expand in the Automation space

Asset Management has generated strong cash flow


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Power Generations Global FootprintPower GenerationPower Generations Global Footprints Global Footprint

Angouleme

Orlans

1980

1995

Olomouc I & IICzech Rep.

Lexington

1999

Mankato

Fuzhou I & IIChina

1999

1999

2001

NoidaIndia

2002

200

6

Reynosa

2007

Adding Capacity To Serve Global Demand

Cluj, Romania

2008


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Evolution Of A Partnership With CaterpillarEvolution Of A Partnership With CaterpillarEvolution Of A Partnership With Caterpillar

This slide has been omitted


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Power Generation Growth DriversPower Generation Growth DriversPower Generation Growth Drivers

Data Centers Telecommunications

Emerging MarketsOil & Gas


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Wind Energy OpportunitiesWind Energy OpportunitiesWind Energy Opportunities

Emerson positioned to supportthe wind power generationindustry with a broad offering ofproducts and technologies

Working with Emerson NetworkPower to pursue opportunities inChina

Supporting Vestas in Europeand pursuing new partners 2MW Wind Power Alternator

CompositeCoupling

Motors & Drives for Turbine Control

China's Wind Power Investment

-

$0.5B

$1.0B

2000 2004 2008 2012


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Small Hydro Power Market Served market $150M growing at 10%

11% Emerson market penetration mainly in Europe

Strong partnership with market leader: VATECHPlan Develop European customers and larger

generators

Hydro And Marine PowerHydro And Marine PowerHydro And Marine Power

Marine Market Electric propulsion (Cruise, LNG, etc)

Essential and standby power

O&G (Tankers, LNG, FPSO, Supply Vessels, etc)

Served market: $400M - Emerson penetration: 3%

70% of the Market in Asia

Plan Gain share in auxiliary gensets

Fuzhou plant positioned to serve market

Shipbuilding is

rapidly expanding inAsia
http://www.oilonline.com/news/features/oe/20060913.Asian_ya.22173.asp


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Success in the Power Generation segmentworldwide continues to be one of the main growthdrivers

Continued focus on emerging markets

All divisions expanding their manufacturing, sales andservice activities in all emerging markets

Increasing the pace of new product development




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Emerging Markets GrowthEmerging Markets GrowthEmerging Markets Growth

$26$3

$88

$38 $52$92

$18

$278

$85$123

-

$100M

$200M

$300M

EasternEurope

Russia Asia-Pacific LatinAmerica

MiddleEast/Africa

2002 2007

Fixed Rate Destination Sales

Total Emerging Markets

2002 2007

Sales (M) $207 $596

5 yr. CAGR 24%

2002-2007CAGR

29% 48% 26% 18% 19%

8%14%

20%

20022007

2012F

% of Total Sales


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Middle East5%

Africa

2%

Eastern

Europe/

Russia

6%

WesternEurope

87%

Taiwan

3%

Australia6%

India

9%

Japan

23%

China

36%Korea

8%

S. E. Asia

15%

Venezuela

7%

Argentina5%Brazil

27%

Mexico

44%

Chile

3%

Columbia

4%

Other L.A.

10%

Global Sales DistributionGlobal Sales DistributionGlobal Sales DistributionWorld-Wide Europe & Middle East

Asia-Pacific Latin America

41%

41%

10%

8%

UnitedStatesROW

Asia

Europe


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Increasing Emerging Markets ParticipationIncreasing Emerging Markets ParticipationIncreasing Emerging Markets Participation China

Two new plants started in 2007 (Mechanical Power Transmission -Zhangzhou, Alternators - Fuzhou)

Implementing a multi-division Industrial Automation Distribution

sales force India

Increasing participation in Alternators Joint Venture

Increasing sales resources

Eastern Europe New Alternators and Electrical Components plants in Romania in

2008

Adding sales resources

Middle East Adding sales resources in every division

Hazardous environment electrical material Service Center in Dubaiand Saudi Arabia

Latin America Increasing sales resources


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Emerson Industrial AutomationEastern European LocationsEmerson Industrial AutomationEmerson Industrial AutomationEastern European LocationsEastern European Locations

Lodz, Poland

Fluid Automation

Novo Mesto, Slovakia

Industrial Equipment

Mechanical PowerTransmission

Brno, Czech RepublicDrive Support Center

Istanbul, Turkey Drive Support Center

Alternator Sales Support

Olomouc, Czech Republic

Alternators

Poznan, Poland

Motors

Iklad, Hungary

Motors

Cluj, Romania

Alternators

Electrical Distribution

Kiev, Ukraine

Shared Sales Offices

Warsaw, Poland


Prague, Czech Republic


Budapest, Hungary

Shared SalesOffices

Bucharest, Romania

Shared SalesOffices


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Emerson Industrial AutomationAsian LocationsEmerson Industrial AutomationEmerson Industrial AutomationAsian LocationsAsian Locations

Shanghai, China Industrial Equipment

Fluid Automation

Motors & Drives


Power Distribution

Fuzhou, China

Alternators

Delhi, India

Alternators

Fluid Automation

Zhangzhou, China Mechanical PowerTransmission

Tianjin, China MechanicalPower Transmission

Pune, India

Drive Support

Singapore

Motors & Drives

Fluid Automation


Power Distribution


Taipei, Taiwan Industrial Equipment

Motors

Hong Kong, Shenzhen


Fluid Automation

MotorsBangkok, Thailand


Fluid Automation

Motors

Drive Support Centre

Chennai, India Drive Support

Fluid Automation

Beijing, China Industrial Equipment

Fluid Automation

Motors & Drives


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Success in the Power Generation segmentworldwide continues to be one of the main growthdrivers



Increasing use of best cost engineering resources

Implementing new Emerson product development process

Customer-focused value-added solutions




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New Product DevelopmentNew Product DevelopmentNew Product DevelopmentIndustrial Automation New Products

Percentage of Sales

20.0%21.4%

20.0% 19.6%19.0%

19.6%

~30%

~23%

15%

20%

25%

30%

2002 2003 2004 2005 2006 2007 2008E 2012

+7 pts

US/Europe based Engineering: 67% Best Cost based Engineering: 33%

2008E Engineering & Design Resource Headcount = 1050

Philippines

3%

Japan & Hong Kong

1%Western Europe

33%

US & Canada

33%

China

13%

Eastern Europe

2%

India12%

Best Cost

33%Latin America

3%


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New Product Development2007 2012 Portfolio ManagementNew Product DevelopmentNew Product Development200720072012 Portfolio Management2012 Portfolio Management



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New Product GrowthNew Product GrowthNew Product Growth

Growth Driver Examples

Energy Efficiency

High Efficiency Dyneo Motors & Drives Program

Wind Power GeneratorsCompact, Efficient Power Supplies

High Speed/Variable Speed Alternators

Integrated Solutions& OperatingEfficiency

Crane & Elevator Motors, Gears Brakesand Drives

Integrated Variable Speed Solutions

Digitax Servo Drives Platforms

Synergies with otherEmerson Businesses

Pneumatics Control with Integrated ProcessConnectivity

Affinity Variable Speed Drives for HVAC

Total 2012 New Product Sales: $1.5+B


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Sources Of Energy SavingsSources Of Energy SavingsSources Of Energy Savings

Electronic Speed Control

Complete System Designto Optimize Efficiency

Energy Efficient

Motor

The Dyneo program provides an integrated solution forenergy efficiency


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DC squaremechanical design up

to 2800 Nm

Customized

Solutions

Explosion Proof

LSRPM

Permanent Magnet Motor

Power: 0.75 to 390 kW

Torque: 10 to 1400 Nm via 11Speed ranges (375 to 5500 rpm)

Electronicvariable speedsolutions

DYNEO: A New Concept Of Permanent MagnetSolutions For Energy & Space SavingsDYNEO: A New Concept Of Permanent MagnetDYNEO: A New Concept Of Permanent MagnetSolutions For Energy & Space SavingsSolutions For Energy & Space Savings


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Increasing the pace of new product development Positioned to expand in the Automation space

Focus growth on automation solutions

Attractive spaces in Discrete and Hybrid markets Asset Management has generated strong cash flow


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Growth OpportunitiesGrowth OpportunitiesGrowth Opportunities

Core Product Lines &

Geographic Expansion

Variable Speed Drives

Fluid Automation Hazardous Environment

Electrical Materials

China

Latin America India

Explore adjacentspaces and unserved

market segments


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Emerson ParticipationEmerson ParticipationEmerson Participation



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Emerson Currently Participates In PiecesOf The Factory Automation SpaceEmerson Currently Participates InEmerson Currently Participates InPiecesPiecesOf The Factory Automation SpaceOf The Factory Automation Space



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Market TrendsMarket TrendsMarket Trends

Solutions

customized to meettheir own uniqueneeds

A continual pipeline

of new andimproved products.

Lower initial and lifecycle costs.

Aggressively

implementing newtechnologies

Facing industry

consolidation &globalization

Focusing on:

Improving flexibility

Decreasing time-to-market

Cutting operational

costs Core competencies

End Users Want: Manufacturers Are:Industrial Automation

Suppliers Must:

Understand the needs

of manufactures andend users

Keep pace with newtechnologies

Serve globalcustomers

Address both discreteand process needs

Provide solutions atlower and lower costs


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Success in the Power Generation segment worldwide

continues to be one of the main growth drivers Continued focus on emerging markets


Positioned to expand in the Automation space Asset Management has generated strong cash flow

more to come

Achieved continuous improvement each of the past 5 years,in line with the plan presented in 2003

Further improvement planned for the next five years, mostlycoming from Inventory turns and driven by lean

manufacturing and supply chain optimization


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Asset ManagementDelivered Strong Cash Flow And Improved ROTCAsset ManagementAsset ManagementDelivered Strong Cash Flow And Improved ROTCDelivered Strong Cash Flow And Improved ROTC



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Industrial Automation Key MessagesIndustrial AutomationIndustrial AutomationKey MessagesKey Messages Improved through-the-cycle underlying growth from

2 - 4% to 3 - 5%






2007 2008EReported Sales Growth 13% 6-9%

Underlying Sales Growth 10% 2-5%

EBIT Margin 15.6% (30)-(10) basis ptsExcluding Anti-Dumping Duties 20-40 basis pts


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Industrial Automation Key MessagesIndustrial AutomationIndustrial AutomationKey MessagesKey Messages Improved through-the-cycle underlying growth from

2 - 4% to 3 - 5%






2007 2008EReported Sales Growth 13% 6-9%

Underlying Sales Growth 10% 2-5%

EBIT Margin 15.6% (30)-(10) basis ptsExcluding Anti-Dumping Duties 20-40 basis pts

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06 Industrial Automation