Parker Hannifin Corporation

Quarterly Earnings Release

4th Quarter FY 2007

August 1, 2007

Exhibit 99.2

*

*

*

*

*

Slide 2

Forward-Looking Statements

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 both its 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, and growth and innovation 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;

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 and interest rates. The company makes these statements as of the date of this

disclosure, and undertakes no obligation to update them.

Slide 3

Non-GAAP Financial Measure

This presentation reconciles sales amounts reported in accordance with

U.S. GAAP to sales amounts adjusted to remove the effects of acquisitions

made within the prior four quarters as well as the effects of currency

exchange rates on sales. The effects of acquisitions and currency

exchange rates are removed to allow investors and the company to

meaningfully evaluate changes in sales on a comparable basis from period

to period.

Slide 4

Discussion Agenda

CEO 4

th

quarter highlights

Key performance measures & outlook

Questions & answers

CEO closing comments

Slide 5

Fourth Quarter and Total Year Highlights

Record Sales, Earnings, Cash Flow and

Segment Operating Margins

Earnings

per

share

from

continuing

operations

up

19%

for

the

quarter

and

33%

for

the

year

Inventory down to 11.8% of Sales

5% organic growth for the year

Globally balanced in Sales and margins as

evidenced by an all-time record in segment

operating margin of 13.8%

Slide 6

Financial Highlights

EPS from Continuing Operations

4

th

Quarter and Total Year

$1.55

$1.84

$7.01

$5.28

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

Q4 FY07

Q4 FY06

FY07

FY06

Slide 7

Influences on Earnings

4

th

Quarter and Total Year

Sales increased 10% for the quarter and 14% for

the year

Gross profit improved 16% for the quarter and

21% for the year

Higher Other income

Reduction in shares outstanding

3.9 million net reduction for the year

Offset by:

Higher SG&A expense

Higher Interest expense

Higher income taxes

Lower quarterly and annual rate

Slide 8

Financial Highlights

Sales –

4

th

Quarter and Total Year

Dollars in millions

FY2007

%

Change

FY2006

FY2007

%

Change

FY2006

Sales

As reported

2,874

$

9.8 %

2,617

$

10,718

$

14.2 %

9,386

$

Acquisitions

120

      

4.6 %

585

        

6.2 %

Currency

59

        

2.2 %

241

        

2.6 %

Adjusted Sales

2,695

$

3.0 %

9,892

$  

5.4 %

4th Quarter

YTD

Slide 9

Influences on Sales

Continued Industrial end market strength

International

–

Asia Pacific

–

Latin America

–

Europe –

particularly

Germany

Distribution

Aerospace

Acquisitions

Emerging markets

Slide 10

Segment Reporting

Industrial North America

Dollars in millions

FY2007

%

Change

FY2006

FY2007

%

Change

FY2006

Sales

As reported

1,055

$

(1.6)%

1,072

$

4,064

$  

1.8 %

3,993

$

Acquisitions

21

        

2.0 %

98

          

2.5 %

Currency

2

          

0.2 %

4

            

0.1 %

Adjusted Sales

1,032

$

(3.8)%

3,962

$  

(0.8)%

Operating Margin

As reported

165

$   

165

$   

598

$      

597

$   

  % of Sales

15.6 %

15.4 %

14.7 %

15.0 %

YTD

4th Quarter

Slide 11

Segment Reporting

Industrial International

Dollars in millions

FY2007

%

Change

FY2006

FY2007

%

Change

FY2006

Sales

As reported

1,083

$

30.3 %

831

$   

3,901

$  

34.4 %

2,903

$

Acquisitions

90

        

10.8 %

415

        

14.3 %

Currency

54

        

6.5 %

222

        

7.6 %

Adjusted Sales

939

$   

13.0 %

3,264

$  

12.5 %

Operating Margin

As reported

143

$   

106

$   

533

$      

354

$   

  % of Sales

13.2 %

12.8 %

13.7 %

12.2 %

4th Quarter

YTD

Slide 12

Segment Reporting

Aerospace

Dollars in millions

FY2007

%

Change

FY2006

FY2007

%

Change

FY2006

Sales

As reported

445

$   

5.9 %

420

$   

1,685

$  

12.0 %

1,505

$

Acquisitions

3

          

0.6 %

15

          

1.0 %

Currency

3

          

0.7 %

12

          

0.8 %

Adjusted Sales

439

$   

4.6 %

1,658

$  

10.2 %

Operating Margin

As reported

67

$      

64

$      

270

$      

221

$   

  % of Sales

15.1 %

15.3 %

16.0 %

14.7 %

4th Quarter

YTD

Slide 13

Segment Reporting

Climate & Industrial Controls

Dollars in millions

FY2007

%

Change

FY2006

FY2007

%

Change

FY2006

Sales

As reported

292

$   

(0.7)%

294

$   

1,068

$  

8.4 %

985

$   

Acquisitions

6

          

2.1 %

56

          

5.7 %

Currency

--

          

-- %

4

            

0.3 %

Adjusted Sales

286

$   

(2.8)%

1,008

$  

2.4 %

Operating Margin

As reported

25

$      

31

$      

82

$        

83

$      

  % of Sales

8.7 %

10.5 %

7.7 %

8.5 %

4th Quarter

YTD

Slide 14

Parker Order Rates

Excludes Acquisitions & Currency

3-month year-over-year comparisons, except Aerospace

Aerospace is calculated using a 12-month moving average

FY07

FY06

Total Parker

3 %

+   

12 %

+

Industrial North America

3 %

-    

8 %

+   

Industrial International

14 %

+

13 %

+

Aerospace

8 %

+   

15 %

+

Climate & Industrial Controls

6 %

-    

22 %

+

Three months ending June

Slide 15

Balance Sheet Summary

Cash

Working capital

Inventory

Accounts

receivable

Pensions –

FAS 158

Slide 16

Strong Cash Flow –

Cash From Operations

459

538

529

631

662

854

955

955

558

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

4.0%

6.0%

8.0%

10.0%

12.0%

FY 07 -

$955

$161 pension contribution; 

$61 incremental to FY06

Dollars in millions

Slide 17

Financial Leverage

Debt to Debt Equity

21.4%

16.0%

18.0%

20.0%

22.0%

24.0%

26.0%

28.0%

30.0%

32.0%

34.0%

36.0%

38.0%

FY99

FY00

FY01

FY02

FY03

FY04

FY05

FY06

FY07

Not to exceed 37% over the cycle

Slide 18

FY 2008  Earnings Outlook Assumptions

Segment Sales & Operating Income

  FY 2008 Sales change versus FY 2007

  Industrial North America

.5 %

  -- 

1.5 %

  Industrial International

8.9 %

  -- 

9.9 %

  Aerospace

0.0 %

  -- 

1.0 %

  Climate & Industrial Controls

0.0 %

  -- 

1.0 %

  FY 2008 Operating margin percentages

  Industrial North America

14.5 %

  -- 

14.9 %

  Industrial International

14.0 %

  -- 

14.4 %

  Aerospace

15.7 %

  -- 

16.1 %

  Climate & Industrial Controls

7.8 %

  -- 

8.2 %

Slide 19

FY 2008  Earnings Outlook Assumptions

below Operating Margin

Corporate Admin

-

5% to   -

9% vs. FY 2007

Interest Expense

-

28% to  -

29% vs. FY 2007

Other Exp. (Income) 

+ 45% to + 41% vs. FY 2007

Tax Rate

30 %

Slide 20

Earnings Outlook –

FY08

Low

High

EPS from continuing operations

7.20

$ 

7.60

$  

Slide 21

Questions & Answers...

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Appendix

Income Statements

4

th

Quarter

Total Year

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Slide 23

Income Statement –

4

th

Quarter

Dollars in millions

% of Sales

% of Sales

Net Sales

2,874.4

$  

100.0 %

2,616.7

$

100.0 %

Cost of sales

2,223.8

     

77.4 %

2,054.0

  

78.5 %

Gross profit

650.6

        

22.6 %

562.7

      

21.5 %

S, G & A

333.4

        

11.6 %

277.1

      

10.6 %

Interest expense

21.5

          

.7 %

18.7

        

.7 %

Other (income) expense

(2.2)

           

(.1)%

1.7

          

.1 %

Income from cont'g operations before taxes

297.9

        

10.4 %

265.2

      

10.1 %

Income taxes

80.7

          

2.8 %

77.4

        

3.0 %

Income from cont'g operations

217.2

        

7.6 %

187.8

      

7.2 %

  Discontinued operations

6.0

          

.2 %

Net income

217.2

$      

7.6 %

193.8

$   

7.4 %

FY 2007

FY 2006

Slide 24

Income Statement –

Total Year

Dollars in millions

% of Sales

% of Sales

Net Sales

10,718.1

$

100.0 %

9,385.9

$

100.0 %

Cost of sales

8,273.0

     

77.2 %

7,367.6

  

78.5 %

Gross profit

2,445.1

     

22.8 %

2,018.3

  

21.5 %

S, G & A

1,226.9

     

11.4 %

1,036.6

  

11.0 %

Interest expense

83.4

          

.8 %

75.8

        

.8 %

Other (income) expense

(24.4)

         

(.2)%

5.9

          

.1 %

Income from cont'g operations before taxes

1,159.2

     

10.8 %

900.0

      

9.6 %

Income taxes

329.2

        

3.1 %

261.7

      

2.8 %

Income from cont'g operations

830.0

        

7.7 %

638.3

      

6.8 %

  Discontinued operations

34.9

        

.4 %

Net income

830.0

$      

7.7 %

673.2

$   

7.2 %

FY 2007

FY 2006