Business

July 24, 2012

‘Tough’ second quarter expected for United Technologies

Future of defense spending, European debt and other problems seen as threats to United Tech 2Q

by Stephen Singer
Associated Press

United Technologies Corp. will release its second-quarter earnings results before the markets open July 26.

 

WHAT TO LOOK FOR: The conglomerate, based in Hartford, Conn., makes jet engines, elevators, heating and cooling equipment for homes and businesses and other aerospace and building systems. It’s in the process of selling several businesses to help finance its largest acquisition to date; $16.5 billion for aerospace supplier Goodrich Corp. in Charlotte, N.C.

Cowen and Co. analyst Cai von Rumohr said recently that more details about the Goodrich deal “could outweigh a well-advertised tough” second quarter.

United Technologies announced July 23 it’s selling its rocket propulsion business for $550 million. Industrial businesses of its Hamilton Sundstrand segment and a wind power company also are up for sale.

The company has warned of slowing economic growth in the United States, China and Europe, the impact of rising oil prices on airline customers and the debt crisis in Europe. Chief Financial Officer Greg Hayes told investor analysts last month that orders for Otis elevator in China are down about 20 percent since June 2011.

And he said India’s economy is “a little bit more uncertain” following the devaluation of the rupee in the last four years.

Von Rumohr said aerospace and defense contractors – United Technologies’ Pratt & Whitney sells military jet engines and Sikorsky Aircraft manufactures the Black Hawk – should produce “decent” second-quarter results. But Congress seems unlikely to resolve the threat of automatic defense spending cuts until late this year, he said, “making it a growing overhang for stocks.”

Edward Jones analyst Matt Collins said in a client note that a key risk to his “Buy” rating is a “muted rebound” in commercial aerospace and commercial construction markets. The conglomerate’s overseas operations also expose it to currency and geopolitical risks, he said.

 

WHY IT MATTERS: United Technologies’ markets span aerospace, defense and home and commercial real estate markets and the conglomerate’s reach extends into emerging markets in China and India, its results indicate how key segments of the domestic and international economies are performing.

 

WHAT’S EXPECTED: United Technologies is expected to post lower profit and revenue in the second quarter than last year’s comparable period. Analysts polled by FactSet expect United Technologies to earn $1.42 per share on revenue of $14.5 billion, compared with $1.45 per share and revenue of $15.08 billion in last year’s April-June period.




All of this week's top headlines to your email every Friday.


 
 

 

Headlines August 28, 2014

News: After F-15 jet crash in Virginia, rescue helicopters search for pilot - Helicopters are searching for an Air National Guard pilot after his F-15 jet crashed in the mountains of Virginia this morning, military officials said.   Business: U.S. Air Force 3DELRR contract expected soon - The U.S. Air Force could award the contract for its...
 
 

News Briefs August 28, 2014

Russian directing new offensive in Ukraine The Obama administration believes Russia is leading a new military counteroffensive in Ukraine. U.S. State Department spokeswoman Jen Psaki says Russia has sent additional columns of tanks and armored vehicles into its neighbor’s territory. She says the incursions suggest a ìRussian-directed counteroffensive is likely underway in the contested e...
 
 
LM-C5

Double Deuce

A U.S. Air Force crew ferried the 22nd C-5M Super Galaxy from the Lockheed Martin facilities in Marietta, Ga., Aug. 25. Aircraft 86-0011 was ferried by a crew led by Maj. Gen. Dwyer L. Dennis, Director, Global Reach Programs, O...
 

 
Northrop Grumman photograph

First ever RQ-4 Global Hawk hits 100th flight on NASA mission

Northrop Grumman photograph A historical look at the first Global Hawk (AV1) during its maiden flight over Edwards Air Force Base, Calif., on Feb. 28, 1998. AV1 has made history again with its 100th flight in support of NASA en...
 
 

Northrop Grumman’s CIRCM system completes U.S. Army flight testing

Northrop Grumman’s Common Infrared Countermeasures system recently completed another round of U.S. Army testing by demonstrating its capabilities on a UH-60M Black Hawk helicopter. The flight test was conducted at Redstone Arsenal in Huntsville, Ala., by the Redstone Test Center. The Northrop Grumman CIRCM system was subjected to rigorous conditions over a six-week period, after...
 
 
NASA photograph by David Olive

NASA completes successful battery of tests on composite cryotank

https://www.youtube.com/embed/qkGI6JeNY0E?enablejsapi=1&rel=0 NASA photograph by David Olive One of the largest composite cryotanks ever built recently completed a battery of tests at NASA’s Marshall Space Flight Cen...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>