Honeywell Reports First Quarter Sales of $7.6 Billion; Earnings of $0.54 Per Share
Company Reports First Quarter In-Line; Anticipating Continued Tough Economic Conditions; Targets Full-Year 2009 Earnings of $2.85 - 3.20 Per Share
MORRIS TOWNSHIP, N.J. -- Honeywell (NYSE: HON) today announced first quarter 2009 sales of $7.6 billion versus $8.9 billion in 2008. Earnings were $0.54 per share, versus $0.85 per share in the prior year. Cash flow from operations was $341 million versus $721 million in the first quarter of 2008 and free cash flow (cash flow from operations less capital expenditures) was $232 million, compared to $571 million last year.
“Honeywell delivered first quarter results that were in line with our expectations,” said Honeywell Chairman and CEO Dave Cote. “While we anticipated a difficult first half of 2009, slow global economic conditions continue and we are adjusting our outlook accordingly.”
“The seed planting that we’ve done over the past several years, combined with the benefits from our global productivity initiatives, are helping in this tough economic environment,” concluded Cote. “Honeywell is a stronger and more flexible company today that can perform in both good times and bad. We continue to invest in new technology, geographic expansion, and process improvements, and will emerge from this downturn an even more efficient and productive growth company.”
Honeywell expects full-year sales of $32.3 - 33.2 billion, earnings per share of $2.85 - 3.20, and free cash flow conversion greater than 100% of net income.
First Quarter Segment Highlights
• Sales were down 9%, compared with the first quarter of 2008, resulting from lower volumes in Commercial Aerospace and the unfavorable impact of divestitures partially offset by growth in Defense and Space.
• Segment profit declined 13% and segment margin decreased by 90 bps to 17.7%, due to lower sales volumes partially offset by increased net productivity.
• Honeywell and Qantas Airlines received approval by the Australian Civil Aviation Safety Authority to use the Honeywell SmartPath™ Ground-Based Augmentation System (GBAS) at Sydney International Airport for satellite-based landings on their A380 aircraft. Honeywell’s SmartPath GBAS is the next-generation navigation technology that supports precision approach and landings using Global Positioning System satellite data and transmits digital guidance signals to aircraft.
• Honeywell was awarded a $70 million contract by the U.S. Air Force for development of new technologies for small gas turbine engines. Funding from the contract will be used to develop and mature a number of technologies, including thermal management, power, controls, health management, and alternative fuels, for the Versatile Affordable Advanced Turbine Engine.
• Honeywell will provide safety and navigational avionics products including IntuVue™, Honeywell’s 3-D weather radar, and the 131-9A Auxiliary Power Unit (APU) for installation on 70 new Airbus A320 aircraft and on 25 optional A320 aircraft to Wizz Air Hungary Ltd. Honeywell and Wizz Air also finalized a long-term service agreement on the Honeywell APU.
Automation and Control Solutions
• Sales were down 6%, compared with the first quarter of 2008, resulting from the unfavorable impact of foreign exchange partially offset by net growth from acquisitions.
• Segment profit declined 5%, primarily due to volume declines, while segment margin increased by 10 bps to 10.4%, due to net productivity improvements.
• Process Solutions announced that Shire Human Genetic Therapies will use several Honeywell solutions – including Experion® Process Knowledge System®, Experion Batch Manager, the OneWireless™ industrial wireless network, and Uniformance Process Historian Database – to control manufacturing processes at its new $250 million production facility in Lexington, Massachusetts.
• Building Solutions was selected by the U.S. Army Corps of Engineers to help the Department of Defense and other federal agencies address energy consumption in their facilities. Honeywell was one of 16 energy services companies to receive a contract for this new program, which could involve as much as $900 million in energy efficiency, renewable energy, and water conservation projects over the next 10 years.
• Honeywell introduced the 5870API Wireless Asset Protection Sensor that guards against theft in both residential and commercial security settings. One of the newest additions of Honeywell’s popular 5800 Series of wireless devices, the 5870API attaches easily to virtually any valuable requiring protection within a home or business, including paintings, flat screen televisions, and other electronics, family heirlooms, safes, machinery, office equipment, and more.
• Sales were down 41%, compared with the first quarter of 2008, resulting from lower volumes and the negative impact of foreign exchange.
• Segment profit declined 102% and segment margin decreased by 1,210 bps to (0.4)%, due to lower sales volumes partially offset by increased productivity driven by cost savings initiatives.
• Honeywell launched its new sequential boosting technology, a groundbreaking turbo technology that enables the new Jaguar XF 3.0L V6 diesel to reduce fuel consumption by 12% and C02 emissions by 10% compared to its predecessor. This new boosting system allows the V6 engine to achieve performance levels of current V8 engines with a staggering 600Nm of torque.
• Honeywell turbochargers were featured on 25 vehicles launched at the 79th International Motor Show of Geneva in March. Honeywell’s applications ranged from 1.4 to 6.0L diesel and gasoline engines, reflecting the global trend toward turbocharging in delivering automotive performance and fuel efficiency.
• Sales were down 25%, compared with the first quarter of 2008, primarily resulting from lower volumes at UOP and price declines due to formula pricing at our Resins and Chemicals business.
• Segment profit declined 53% and segment margin decreased by 690 bps to 11.9%, due to lower volumes partially offset by lower raw material costs and the positive impact of cost savings initiatives.
• Honeywell’s UOP launched Envergent Technologies, a new joint venture with Ensyn Corp. that will offer technology and equipment to convert second-generation biomass into pyrolysis oil for power generation, heating fuel, and conversion into transportation fuels.
• Honeywell is developing a new low-global-warming-potential (LGWP) blowing agent for energy efficient polyurethane foam insulation. The new material is part of a larger LGWP platform that also includes new refrigerants for mobile applications.
Honeywell will discuss its results during its investor conference call today starting at 8:00 a.m. EDT. To participate, please dial (719) 325-4846 a few minutes before the 8:00 a.m. start. Please mention to the operator that you are dialing in for Honeywell’s investor conference call. The live webcast of the investor call will be available through the “Investor Relations” section of the company’s Website (http://www.honeywell.com/investor ). Investors can access a replay of the investor call starting at 11:00 a.m. EDT, April 24, until midnight, May 1, by dialing (719) 457-0820. The access code is 2142307.
Honeywell International (www.honeywell.com) is a Fortune 100 diversified technology and manufacturing leader, serving customers worldwide with aerospace products and services; control technologies for buildings, homes and industry; automotive products; turbochargers; and specialty materials. Based in Morris Township, N.J., Honeywell’s shares are traded on the New York, London, and Chicago Stock Exchanges. For more news and information on Honeywell, please visit www.honeywellnow.com.
This release contains certain statements that may be deemed “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, that address activities, events or developments that we or our management intends, expects, projects, believes or anticipates will or may occur in the future are forward-looking statements. Such statements are based upon certain assumptions and assessments made by our management in light of their experience and their perception of historical trends, current economic and industry conditions, expected future developments and other factors they believe to be appropriate. The forward-looking statements included in this release are also subject to a number of material risks and uncertainties, including but not limited to economic, competitive, governmental, and technological factors affecting our operations, markets, products, services and prices. Such forward-looking statements are not guarantees of future performance, and actual results, developments and business decisions may differ from those envisaged by such forward-looking statements.
This news content was configured by WebWire editorial staff. Linking is permitted.
News Release Distribution and Press Release Distribution Services Provided by WebWire.