Ingersoll Rand Announces Record Earnings and Revenues for 2006 Second Quarter; Earnings Increased by 14% to $0.95 per Share

-- Revenues increased by 10% to $3,042 million in the second quarter.

-- Diluted earnings per share increased by 14% for the 2006 second quarter.

-- Full year EPS forecast increased to $3.45 to $3.55.

Ingersoll-Rand Company Limited (NYSE:IR), a leading diversifiedindustrial company, today announced record earnings and revenues forthe second quarter of 2006.

The company reported net earnings of $313.5 million, or dilutedearnings per share (EPS) of $0.95, for the second quarter of 2006.Second-quarter net earnings included $322.0 million, or EPS of $0.97,from continuing operations, as well as $8.5 million of costs, or EPSof $(0.02), from discontinued operations, which represents retainedcosts of divested businesses. Reported second-quarter EPS increased by14% compared with 2005, and EPS from continuing operations alsoincreased by 14%.

Net earnings for the 2005 second quarter of $285.4 million, or EPSof $0.83, included $0.85 from continuing operations and $6.4 millionof costs, or $(0.02), for discontinued operations.

"We continue to demonstrate strong growth and operationalimprovement across our global businesses," said Herbert L. Henkel,chairman, president and chief executive officer. "This progress is thedirect result of a successful portfolio transformation, as well as anongoing transformation of our operating culture.

"As opposed to the capital-intense, heavy-machinery profile of ourpast, today's Ingersoll Rand is a multi-brand commercial productsmanufacturer serving customers in diverse global markets. Ourindustry-leading businesses continue to prove their manufacturingexcellence, product innovation and operational efficiency, whichcombine to deliver customer pleasing solutions. Our ability toleverage the enterprise has enabled us to significantly offsetmaterials price increases, and our focus on building a 'one IngersollRand' culture is creating new pathways for sharing knowledge, bestpractices and resources for the benefit of the global enterprise.Ingersoll Rand is a different, and better, company today, and ispoised to generate greater progress and value for customers, employeesand shareholders for the future."

Additional Highlights for the 2006 Second Quarter

Revenues: The company's revenues increased by 10% to $3,041.9million compared with revenues of $2,759.5 million for the 2005 secondquarter. Second quarter revenues increased in all business segmentsand geographical markets compared with 2005.

Total recurring revenues, which include revenues from parts,service, rental, attachments and used equipment, increased by 11%compared with the second quarter of 2005, and accounted for 20% oftotal revenues.

Operating Income and Margins: Operating income of $416.5 millionfor the second quarter of 2006 increased by 10% compared with thesecond quarter of 2005. Second-quarter operating margins of 13.7% wereconsistent with 13.7% last year.

Interest and Other Expense: Interest expense was $30.4 million forthe second quarter of 2006, compared with $37.7 million in the 2005second quarter. Other expense totaled $1.2 million for the secondquarter, compared with $10.2 million in income for the second quarterof 2005. The year-over-year difference is attributable to foreignexchange losses in 2006 compared to foreign exchange gains in 2005,and increased minority interest expense in 2006.

Taxes: The company's effective tax rate for continuing operationsfor the second quarter of 2006 was 16.3%, compared to 17.0% in thesecond quarter of 2005.

Options Expense: In the first quarter of 2006 the company adoptedFAS 123(R), which requires the expensing of stock options. Totalpre-tax options expense for the second quarter was $3.4 million, orEPS of $(0.01). Total pre-tax expense for the year should approximate$16 million, or EPS of $(0.03).

Second-quarter Business Review

The company classifies its businesses into five reportablesegments based on industry and market focus: Climate ControlTechnologies, Compact Vehicle Technologies, Construction Technologies,Industrial Technologies, and Security Technologies.

Climate Control Technologies provides solutions for customers thattransport, preserve, store and display temperature-sensitive products,and includes the market-leading brands of Hussmann(R) and ThermoKing(R). Revenues for the segment of $798 million increased byapproximately 10% compared with the second quarter of 2005.Second-quarter 2006 operating margins were 11.1%, compared with 11.5%in the 2005 second quarter. Higher volumes and improved pricing wereoffset by material inflation and inventory adjustment costs.

Revenue from North American operations increased by approximately13% compared with last year. Transport refrigeration revenues expandedcompared to last year, bolstered by sales of the TriPac(R) auxiliarypower unit. Stationary refrigeration revenue also expanded fromincreased display case shipments and higher revenue from the serviceand installation business.

Revenue from international operations increased by 4%. Europeanrevenues increased compared with last year primarily driven byimprovements in the trailer business. Asian revenues declined, mainlydue to lower bus air conditioning sales in China.

The Compact Vehicle Technologies segment includes Bobcat(R)compact equipment and Club Car(R) golf cars and utility vehicles.Total revenues increased by approximately 9% to $789 million comparedwith $727 million in the 2005 second quarter. Operating marginsimproved to 17.4%, compared with 16.1% in the second quarter of 2005.

Bobcat revenues increased by 7% compared with last year, due toincreased sales of tracked vehicles and mini-excavators in NorthAmerica and improving compact equipment markets in Europe. Higherparts and attachment shipments also drove revenue gains compared to2005. Bobcat margins improved, reflecting volume gains and thebenefits of pricing actions and productivity initiatives, partiallyoffset by higher material and transportation costs.

Club Car revenues increased by 14% compared with the secondquarter of 2005, primarily reflecting market share gains in golf carsand higher sales of transport and utility vehicles. Margins alsoimproved compared with last year.

Construction Technologies includes Ingersoll Rand(R) road pavers,compactors, portable power products and general-purpose constructionequipment. Revenues increased by 13% to $389 million compared with thesecond quarter of 2005, due to ongoing strength in the markets forRoad Development and Utility Equipment and the growing Attachmentbusiness. Operating margins improved to 13.8% compared with 12.2% inthe second quarter of 2005 due to higher volumes, favorable productmix, higher prices and operating improvements, partially offset byhigher material costs.

Industrial Technologies is focused on providing solutions toenhance customers' industrial and energy efficiency and providesequipment and services for compressed air systems, tools, fluidhandling and energy generation systems. Total revenues in the secondquarter increased by approximately 12% to $483 million. Strength inworldwide industrial markets continued to benefit Air Solutions withimproved activity in all major geographic regions. ProductivitySolutions revenue also increased as a result of expanding activity intraditional industrial and fluid handling markets. Second-quarteroperating margins were 13.0% compared with 13.7% in 2005 as highervolumes, pricing and productivity savings were offset by highermaterial costs, unfavorable product mix and the impact of a four-weekwork stoppage at an air compressor facility in India.

Security Technologies includes mechanical and electronic securityproducts; biometric and access-control technologies; security andscheduling software; integration and services. Second-quarter revenuesincreased by 10% to $583 million, led by strong commercial andinstitutional market growth in all major geographical regions.Operating margins were 16.8% compared with 17.9% in 2005. Marginimprovements from commercial and institutional volume and productivitygains were offset by significant cost increases for nonferrous metalsand increased investment spending for new product launches.

Balance Sheet

Total debt at the end of the second quarter was $1,639 million.The debt-to-capital ratio was 21.1% at the end of the second quarter,compared with 27.9% at the end of the second quarter of 2005. Duringthe second quarter of 2006, the company purchased approximately 5million shares of Ingersoll Rand stock for $220 million under a $2billion stock repurchase program. Additionally, approximately 2.5million shares of stock have been purchased in July for $100 million.Approximately $610 million remains available for future sharepurchases under the program. The company is targeting to invest $800million to purchase shares for full-year 2006.

2006 Outlook

"Activity in most of Ingersoll Rand's major end markets remainedstrong during the second quarter," said Henkel. "Second-quarter ordersfor the total company increased by approximately 14% compared with2005. Based on our projected order pattern and current expectationsfor material cost inflation, we expect third-quarter 2006 earnings of$0.82 to $0.87 per share," said Henkel. "Earnings from continuingoperations are expected to be $0.85 to $0.90 per share, withdiscontinued operations at 3 cents of costs. These forecasts reflect a13% to 20% EPS improvement in continuing operations compared withthird-quarter 2005. Second half revenues are expected to increase by6% to 8% compared with 2005. The tax rate for the balance of 2006 isexpected to be 16.7%.

"We had a strong start in the first half of the year and we expectrecord revenues and earnings for 2006," said Henkel. "Full-year 2006revenue growth should approximate 8% to 9% compared with 2005. We areincreasing the forecast for full-year EPS to a range of $3.45 to $3.55per share. Earnings from continuing operations are expected to be$3.57 to $3.67 per share, with discontinued operations at 12 cents ofcosts. These forecasts represent a 16% to 19% EPS increase incontinuing operations, compared with 2005. Our available cash flow*forecast for 2006 remains in the range of $850 to $900 million."

* Available cash flow is equal to cash flow from operatingactivities and discontinued operations, excluding voluntary pensioncontributions, minus capital expenditures.

Ingersoll Rand is a leading diversified industrial companyproviding products, services and integrated solutions to industriesranging from transportation and manufacturing to food retailing,construction, and agriculture. With a 135-year-old heritage oftechnological innovation, we help companies worldwide to be moreproductive, efficient and innovative. In every line of our business,Ingersoll Rand enables companies and their customers to createprogress. For more information, visit www.ingersollrand.com.

This news release includes "forward-looking statements" as definedin the Private Securities Litigation Reform Act of 1995 with respectto our financial condition, results of operations and business. Thesestatements are based on currently available information and are basedon our current expectations and projections about future events. Thesestatements are subject to risks and uncertainties that could causeactual results, performance or achievements to differ materially fromanticipated results, performance or achievements.

These risks and uncertainties include, but are not limited to:fluctuations in the condition of, and the overall political landscapeof, the economies in which we operate; our competitive environment;material changes in technology or technology substitution; our abilityto attract, train and retain highly-qualified employees; unanticipatedclimatic changes; changes in governmental regulation; the costs andeffects of legal and administrative proceedings; changes in tax laws,tax treaties or tax regulations or the interpretation or enforcementthereof; currency fluctuations; our ability to complete acquisitionson financially attractive terms and successfully integrate them withour other businesses; and the impact of new accounting standards.Undue reliance should not be placed on such forward-looking statementsas they speak only as of the date made. Additional informationregarding these and other risks and uncertainties is contained in ourperiodic filings with the SEC, including, but not limited to, itsreport on Form 10-Q for the quarterly period ended March 31, 2006.

INGERSOLL-RAND COMPANY, LIMITED
Consolidated Income Statement
Second Quarter and Six Months
(In millions, except per share amounts)

UNAUDITED


Three Months Six Months
Ended June 30, Ended June 30,
----------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------

Revenues $3,041.9 $2,759.5 $5,752.9 $5,218.3

Cost of goods sold 2,215.4 2,019.1 4,213.4 3,829.8

Selling & administrative
expenses 410.0 361.3 781.9 712.5
-------- -------- -------- --------

Operating income 416.5 379.1 757.6 676.0

Interest expense (30.4) (37.7) (65.2) (74.2)

Other income / (expense) (1.2) 10.2 2.6 17.4
-------- -------- -------- --------

Earnings before taxes 384.9 351.6 695.0 619.2

Provision for taxes 62.9 59.8 110.6 95.1
-------- -------- -------- --------

Earnings from continuing
operations 322.0 291.8 584.4 524.1

Discontinued operations,
net of tax (8.5) (6.4) (17.7) (15.6)
-------- -------- -------- --------

Net earnings $ 313.5 $ 285.4 $ 566.7 $ 508.5
======== ======== ======== ========


Basic earnings per share
------------------------
Continuing operations $ 0.98 $ 0.86 $ 1.78 $ 1.53
Discontinued
operations $ (0.02) (0.02) (0.05) (0.04)
-------- -------- -------- --------
$ 0.96 $ 0.84 $ 1.73 $ 1.49
======== ======== ======== ========

Diluted earnings per
share
--------------------
Continuing operations $ 0.97 $ 0.85 $ 1.76 $ 1.52
Discontinued
operations $ (0.02) (0.02) (0.05) (0.05)
-------- -------- -------- --------
$ 0.95 $ 0.83 $ 1.71 $ 1.47
======== ======== ======== ========

Weighted-average number
of common shares
outstanding:
Basic 327.1 338.7 327.9 341.6
Diluted 330.8 342.2 331.5 345.5


INGERSOLL-RAND COMPANY LIMITED
Business Review
Second Quarter and Six Months
(In millions, except percentages)

UNAUDITED

Three Months Six Months
Ended June 30, Ended June 30,
------------------- -------------------
2006 2005 2006 2005
-------- -------- -------- --------
Climate Control Technologies
----------------------------
Revenues $ 798.0 $ 728.0 $1,481.6 $1,367.4
Operating income 88.4 83.7 157.6 143.9
and as a % of revenues 11.1% 11.5% 10.6% 10.5%

Compact Vehicle Technologies
----------------------------
Revenues 789.2 726.7 1,523.7 1,387.3
Operating income 137.1 117.2 258.3 225.7
and as a % of revenues 17.4% 16.1% 17.0% 16.3%

Construction Technologies
-------------------------
Revenues 388.5 343.1 717.5 612.6
Operating income 53.5 41.8 92.1 67.5
and as a % of revenues 13.8% 12.2% 12.8% 11.0%

Industrial Technologies
-----------------------
Revenues 483.3 432.2 922.4 835.7
Operating income 63.0 59.1 121.2 106.4
and as a % of revenues 13.0% 13.7% 13.1% 12.7%

Security Technologies
---------------------
Revenues 582.9 529.5 1,107.7 1,015.3
Operating income 98.0 94.9 177.6 163.9
and as a % of revenues 16.8% 17.9% 16.0% 16.1%

Total
-----
Revenues $3,041.9 $2,759.5 $5,752.9 $5,218.3
Operating income 440.0 396.7 806.8 707.4
and as a % of revenues 14.5% 14.4% 14.0% 13.6%

Unallocated corporate expense (23.5) (17.6) (49.2) (31.4)
-------- -------- -------- --------

Consolidated operating income $ 416.5 $ 379.1 $ 757.6 $ 676.0
======== ======== ======== ========
and as a % of revenues 13.7% 13.7% 13.2% 13.0%



INGERSOLL-RAND COMPANY LIMITED
Condensed Consolidated Balance Sheet
(In millions)

UNAUDITED


June December
30, 2006 31, 2005
--------- ---------
ASSETS
Current assets:
Cash and cash equivalents $ 258.7 $ 880.6
Marketable securities 0.6 156.5
Accounts and notes receivable, net 2,071.6 1,679.0
Inventories 1,297.7 1,128.8
Prepaid expenses and deferred income
taxes 402.7 403.3

----------- ----------
Total current assets 4,031.3 4,248.2

Property, plant and equipment, net 1,202.6 1,157.5
Goodwill 4,522.0 4,433.4
Intangible assets, net 719.3 717.0
Other assets 1,283.5 1,200.3
--------- ---------

Total assets $11,758.7 $11,756.4
========= =========




LIABILITIES AND EQUITY
Current liabilities:
Accounts payable $ 932.7 $ 812.5
Accrued compensation and benefits 398.9 401.4
Accrued expenses and other current
liabilities 1,122.2 1,053.1
Current maturities of long-term debt and
loans payable 467.5 932.7
--------- ---------

Total current liabilities 2,921.3 3,199.7

Long-term debt 1,171.4 1,184.3
Post-employment and other benefits 1,002.0 1,000.9
Other noncurrent liabilities 603.0 609.5
--------- ---------

5,697.7 5,994.4
--------- ---------
Shareholders' equity:
Class A common shares 324.8 330.7
Other shareholders' equity 5,735.5 5,558.9
Accumulated other comprehensive income /
(loss) 0.7 (127.6)
--------- ---------

Total shareholders' equity 6,061.0 5,762.0
--------- ---------

Total liabilities and equity $11,758.7 $11,756.4
========= =========