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Crane Co. Gabelli Asset Management 12th Annual Aircraft Supplier Conference September 7, 2006

Crane Co. Gabelli Asset Management 12th Annual Aircraft Supplier Conference September 7, 2006. J. Robert Vipond Vice President & CFO Crane Co. Forward-Looking Statements Disclaimer.

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Crane Co. Gabelli Asset Management 12th Annual Aircraft Supplier Conference September 7, 2006

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  1. Crane Co. Gabelli Asset Management 12th Annual Aircraft Supplier Conference September 7, 2006 J. Robert Vipond Vice President & CFO Crane Co.

  2. Forward-Looking Statements Disclaimer This presentation includes forward-looking statements that are by their very nature uncertain. There can be no guarantee that any forward-looking statement will be fulfilled. The Company assumes no obligation to update forward-looking statements to reflect actual results or changes in or additions to the factors affecting such forward-looking statements. Reference is made to the Company’s Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission for additional information involving known and unknown risks, uncertainties and other factors. Please also refer to the full forward-looking statements disclaimer contained in the Company’s Form 10-K and subsequent reports filed with the Securities and Exchange Commission.

  3. Overview • Diversified manufacturer of highly engineered products - Focused niche markets which we dominate - Businesses high returns and cash flow - Acquisitions to strengthen existing businesses • Above all conduct business with integrity and honest dealings • Transitioning from Holding Co. to Operating Co. to accelerate EVA Growth • Our Goal is to build shareholder wealth

  4. Strategy for Profitable Growth Grow Profits from Existing Operations • Materially Improving Operations • Leveraging Intellectual Capital • Improving Customer Focus • Executing Operational Excellence • Strategic Linkages • Portfolio Trimming • Internal Mergers • Synergistic Acquisitions • 2001 - $197 Million – 6 transactions • 2002 - $82 Million – 7 transactions • 2003 - $169 Million – 4 transactions • 2004 - $51 Million – 2 transactions • 2005 - $9 Million – 2 transactions • 2006 - $162 Million – 3 transactions Integrated Operating Company Redeploy Free Cash Flow for Acquisitions Strengthen Existing Business Units Noble Composites pending Hart-Scott- Rodino

  5. Gating Chart

  6. 2005 ($214 Million) 2001 ($197 million) 6% 3% 13% 1% 17% 25% 35% 19% 50% 31% Better Portfolio Balance Business Segments Operating Profit Note: Pie charts show relative business unit contribution before corporate expenses.

  7. Crane Co. ($ in millions) * * • Operating profit before the 2004 net non-cash charges for asbestos and environmental and for 2002 before asbestos charge. *Dec. ‘05 Guidance

  8. 2006 Guidance Crane Co. estimates for sales, operating profit and margin % provided in Dec. ’05 Crane Co. estimates for tax rate and EPS updated in July ’06. • Operating profit before asbestos and environmental charge and Victaulic gain. For further details see non-GAAP reconciliation that accompanied our March 7, 2006 investor presentationon Crane Co. website at www.craneco.com.

  9. 1H’06 Results

  10. 2006 Guidance Free Cash Flow * Crane Co. estimate April ‘06

  11. Capitalization ($ in millions) • 12/31/05 Cash $180 million • 6/30/06 Cash $100 million

  12. 2006 Capital Deployment Redeploy Capital to Accelerate Growth $100 M of Cash at 6/30/06 Crane Co. Asbestos Liability - Recent trends more stable $185 M ’06 Free Cash Flow Rating Agencies - Stable BBB Baa-2 $294 M of Debt - 25% of Capital at 6/30/06 Shareholders - Dividends - Acquisitions - Stock Repurchases • Quarterly dividend increased 20% in July 2006 • 2006 acquisitions $162 million • In 1H’06, repurchased 636,300 shares for $25 million

  13. 2006 Summary Profit Growth From Existing Operations • Strengthened Management Teams • Strategic Acquisitions for Core Business • Operational Excellence Traction • Late Economic Cycle Exposure • Expect To Surpass 2005 Record EPS Redeploy Capital to Accelerate Growth • $100M of Cash at 6/30/06 • $185 M ’06 Free Cash Flow • $294 M of Debt: 25% of Capital at 6/30/06

  14. Gabelli Aircraft Supplier Conference Crane Co. (CR) Crane Aerospace September 7, 2006 Gregory A. Ward President Crane Aerospace Group, Inc.

  15. Crane Aerospace Group Our 4 Brands: ELDEC - Hydro-Aire - Lear Romec – P.L. Porter Elyria, OH Lyon, France Lynnwood, WA Burbank, CA Divested Resistoflex 2006 Wichita, KS • 2005 Sales $339M • No. of Employees 1,450 • Mfg Space 478,800 sq ft • Global Business 30+ countries Two plant consolidations completed

  16. Products and Solutions AIRCRAFTELECTRICALPOWER CABIN FLUIDMANAGE-MENT LANDING SYSTEMS Solutions Current Products Value Proposition • Battery Systems • Ground Fault Interrupters (SafeTripTM) • Inverters • Power Management & Distribution Systems • Automatic Transformer Rectifier Units Applications engineering excellence (system knowledge), lightest weight, highest value, highestpower quality AC-DC power conversion • Seat Actuation • Lumbar Support • Integrated Control • Power Conversion Rapid development, on time delivery and use of emerging technology. Customers will pay premiums for passenger comfort and extended passenger services • Lube and Scavenge Pumps • Coolant Pumps and Package Systems • Fuel Boost, Transfer and Jettison Pumps • Fuel Flowmeters / Fuel Gauging Systems Applications engineering excellence, superior product performance and packaging, fast development times and outstanding product support Applications engineering excellence, superior performance and flexible business models. Industry knowledgeand expertise. Extending the life of braking components • Brake Control Components and Systems • Hydraulic Equipment • Gear Extension & Retraction Systems • Brake temperature monitoring SENSING/ UTILITY SYSTEMS • Proximity Switches, Sensors, & Systems • Silicon On Sapphire Pressure Sensors • Weight & Balance Systems • Wireless Sensors (incl. SmartStem pressure) Highest reliability, most accurate, and highest value position indication of critical systems such as landing gear, doors, and control surfaces (prox only)

  17. OEM Sales Mix OEM Sales Total Civil Vs. Military Sales * 2006E Total Sales * 2006E OEM Sales *Civil: Commercial, Regional, Business, BFE *BFE:Buyer Furnished Equipment Strong Niche Shares • Landing: Brake Control 64% • Sensing/Utility: Proximity Sensing 63% • Fluid: Pumps 42% • Cabin: Seat Actuation 41% • Aircraft Electrical Power 30% Key Takeaway: Niche products and systems

  18. Three Business Models New Buyer Furnished Equipment (BFE) Model • Cabin Solution only • Serves both new and fielded fleets • Replacement cycle every 5 and 13 years • Short development and payback periods Classic OEM - Aftermarket Model • All Solutions except Cabin • Driven by new platforms • Long development cycles • Long payback periods 2006E Sales Mix OEM (61%) /Aftermarket (39%) Modernization & Upgrade (M&U) Model • Focused on Operators Cost of Operations • Market based on fielded fleet • Shorter development cycles • Shorter payback periods

  19. OEM Forecast For The Industry

  20. Strong Civil OEM Growth: 4 - 5% CAGR Commercial OEM Summary 2,500 2,000 1,500 Build Rates 1,000 500 0 2002 2003 2004 2005 2006 2007 2008 Landing Commercial OEM Sensing Commercial OEM Cabin Commercial OEM Fluid Commercial OEM AEP Commercial OEM Other Commercial OEM Commercial OEM Build Rate Crane civil OEM sales growth consistent with build rates Revenue

  21. Military OEM Growth: 3 - 4% CAGR 425 375 325 275 225 Revenue Build Rates 175 125 75 25 -25 2002 2003 2004 2005 2006 2007 2008 Fluid Military OEM Landing Military OEM Sensing Military OEM AEP Military OEM Military OEM Build Rate Crane military OEM sales growth consistent with build rates Build Rate Excludes Helicopters

  22. Aftermarket Industry Forecast Active FleetAnalysis* Key Industry Trends: • Robust Commercial Spares and R&O due to aircraft coming out of warranty & Increasing active fleet • 15,000+ aircraft today • 3 – 5 % CAGR projected • Growing installed base for Modernization & Upgrade opportunities • More Commercial Initial Provisioning * ACAS data Commercial Aftermarket projected at 3 - 5% CAGR for the Industry Market Issues: • Financial stability of the operators • Fuel prices / terrorism / air traffic control • Increased use of third-party R&O and logistics

  23. Operators Need To Modernize and Upgrade • Large fielded fleet • 15,000+ Civil Aircraft • 30,000+ Military Aircraft (fixed & rotorcraft) • New aircraft • Technology making the A/C more efficient • Difficult for legacy carriers to compete with newer fleets • Crane focus on adding value to the older aircraft • Mandated safety items • Systems and components that reduce operating costs • Operators will pay for added value • M&U tends to equate to better margins • Focused on balancing our Civil / Military mix • Adding sales force • Investing in Military technology 2006E M&U Mix 2007 – 09E M&U Mix

  24. Weight and Balance System AirWeighs under development Reduces operator costs New pax & baggage weights driving need Government funded flight demonstration program pending contract finalization C-130 Technology Demo completed Competing for 777 Freighter New M&U Products ControlUnit Sensors & Actuators Interface Actuator Existing Hydraulic Pump Strut Manifold Sensors & Actuators Interface Existing Reservoir Strut Gas Isolator Return Pressure Airplane Hydraulic Pressure Strut Oil • Wireless Tire Pressure System • “SmartStem” flying now • In-service evaluation on 777 • Reduces operator costs • Handheld version • Contract with Cessna • On Board System • Boeing contract 777 • Smiths contract 787

  25. Crane Aftermarket Growth: 15 – 20% CAGR M&U accelerating our Aftermarket growth

  26. Aerospace Market Summary Operators OEMs • Major U.S. Airlines making a modest profit • Global airlines continue growth • Impact of Oil prices & terror threat still in question • LCC model driving industry changes • Steady Aftermarket Sales growth • New opportunities due to large fleets • Modernization & Upgrades • Military business hard to forecast • JSF, Tanker • Funded upgrades • Increasing OEM Build Rates • Thru 2010 • OEM Price Concessions • YOY with Aftermarket pricing limits • Major military platforms in the out years • JSF / UCAV • Many OEM program opportunities • Replace incumbent systems • Airbus A350 XWB • Narrow body replacements • LJs and VLJs • UCAVs • Many M&U opportunities • Military • Civil Key Takeaway: 3-5% CAGR is expected in this changing aerospace market

  27. So What’s Our Strategy? Business Factors Strategic Issues • Airline financial health • Increasing build rates • Fuel costs & terror threats • High program investments • Intense price pressures • Technical resource shortages Increase Organic CAGR Maintain Margins Protect & Maintain All Solutions Intellectual Capital and Operational Excellence Everyone, Everywhere Commercial Commercial Commercial Aftermarket M & U OEM Military Military Military Prioritization of Investments Balanced Long & Short term EVA Growth

  28. Protect and Maintain the Franchises • Satisfy our customers • Voice of the Customer • Dedicated team and process • Monthly review and actions • Train the entire workforce • Flawless customer metrics • Responsiveness • On Time Delivery • Quality Satisfied Customers give us: • Follow on core business • New growth opportunities

  29. Giving our customers more value • Lean is our way of life • Enterprise-wide Operational Excellence • Structured daily process • Visual controls • All functions • Centralization of functions and processes • Leverage automation, standard work • Organized by value streams • Streamlined Organization Structure • Easy to do business with • Right people in the right roles • Increased productivity • Low cost sourcing • Facilities Consolidation

  30. Reducing Costs & Improving Service Legacy Business One Company Change Organization Transformation • 4 Business Units w/ P&L • 4 Leadership teams • Separate Functional Organizations • Multiple internal & external customer interfaces • Varying strategies & industry knowledge • Unique processes and procedures • 1 Business Unit (w/ P&L) • 1 Leadership team • One bonus system • Centralized several functional organizations • Sales & Marketing single face to the customer • Began common ERP system implementation • Group processes and procedures • Common strategic agenda • Streamlined organization • Right People, Right Roles • Centralized processes • Engineering • Quality • Program Mgmt • Infrastructure • Simplified customer interfaces • Order entry • Enterprise-wide OpEx • SDP, Kaizen • Value Streams • Standard work 2002 2005 2005 Sales = 9.7% growth Employees = 10% less SG&A Mfg space = 27% less 2006 Annual Savings = $5M 2006 (Sold Resistoflex 5/06) 2002 Sales = $257M Employees = 1,299 Mfg space = 494,000 • 2004 Sales = $309M* • Employees = 1,433* • Mfg space = 584,000* • Annual Savings = $7M 2004 (Acquisition of PL Porter)

  31. Investing more in Organic Growth • Maintain margins while increasing R&D investments • Growing the Core Solutions • Expanding Solutions with new M&U opportunities • Must Increase engineering capacity • To take advantage of growth opportunities • Retention of key contributors • Re-recruit the Keepers • Utilize remote engineering locations • Greater mix of low cost capacity • Self funded R&D • 2005 - $36M 10% of sales • 2006F - $43M 12% of sales

  32. Organic Growth Long-Term Short-Term

  33. Summary: Stay the Course • Our focus remains on • High value niche products • High margins • High growth • All five niche Solutions are in high demand • Grow the Solutions by satisfying our customers • Expand the Solutions with products and systems • That lower operating costs • Accelerate our M&U strategy Aerospace Group Strategy Delivers: • Franchise protection • High margins • High annual growth

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