Business

July 24, 2013

United Tech posts big second quarter profit, revenue gains

Stephen Singer
Associated Press

United Technologies, citing strong orders at its elevator business in China and for commercial airline parts, posted double-digit percentage increases in profit and revenue for the second quarter Tuesday.

The aerospace and building systems conglomerate is benefiting from its $18.4 billion purchase of Goodrich, and subsidiary Pratt & Whitney’s $1.5 billion deal to buy Rolls-Royce out from a joint venture that makes engines for the Airbus A320. Without the acquisitions, revenue for the quarter would have been flat.

The parent company of helicopter maker Sikorsky Aircraft, Otis elevator and other businesses beat Wall Street estimates, posting net income of $1.56 billion, or $1.70 per share, or $1.69 per share to account for discontinued businesses.

United Technologies, based in Hartford, Conn., fell shy of analyst expectations for revenue, posting sales of $16 billion, up 16 percent from 2012.

Analysts polled by FactSet, on average, expected earnings of $1.58 per share on revenue of $16.37 billion.

CEO Louis Chenevert said strong orders put the company in a good position for a return to growth, excluding its acquisitions in the second half of 2013.

New equipment orders at Otis increased 23 percent over the year-ago quarter, led by 39 percent growth in China.

Orders for large commercial engine spare parts were up 65 percent at Pratt & Whitney, including the benefit from its Rolls-Royce buyout. Excluding benefits from the Rolls-Royce deal, commercial spare parts orders rose 15 percent at Pratt & Whitney.

Chief Financial Officer Greg Hayes told analysts on a conference call that estimates of about 5 percent growth in spare parts sales are “probably more like flattish,” though the company is looking forward to momentum in orders.

There are 575 workers who are taking retirement offers at Pratt & Whitney, and that is expected to boost profitability at the engine maker, he said. With the winding down of U.S. operations in Afghanistan, military engine sales are ìcoming down significantly.

ìThis is a tough year at Pratt,î Hayes said.

Edward Jones analyst Christian Mayes said analysts have been waiting some time for orders of engine parts to increase.

There’s some healing going on in that market, he said.

In addition, Otis elevator performed well in China, despite a sluggish economy, he said.

United Technologies, which announced it will boost restructuring costs for 2013 to $450 million, up $100 million from previous projections, can find areas to cut and make other changes at its acquisitions, Mayes said. They have more room to go on that,î he said.

United Technologies said the restructuring costs should be offset by one-time items.

It also said it has completed its business sales. It sold non-core businesses, including industrial products businesses, a wind energy company and its Rocketdyne engine-making segment, to focus on aerospace and building systems and to raise money to help finance the Goodrich purchase.




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


 
 

 
LM-F35-hours

F-35 fleet surpasses 15,000 flying hours

The Lockheed Martin F-35 Lightning II fleet recently surpassed 15,000 flight hours, marking a major milestone for the program.  “Flying 15,000 hours itself demonstrates that the program is maturing, but what I think is e...
 
 

Raytheon awarded first international contract for Paveway IV

Raytheon has received a contract from an international customer for Pavewayô IV precision guided bombs valued at more than $200 million. As part of the sale Raytheon will deliver hundreds of the advanced munitions, which are regarded as the ‘weapon of choice’ for the Royal Air Force. The contract represents the first sale of Pavewayô...
 
 
Northrop Grumman photograph

Northrop Grumman dedicates Aircraft Integration Center of Excellence in Florida

Northrop Grumman photograph Tom Vice, corporate vice president and president, Northrop Grumman Aerospace Systems, addresses the media with, from left, Florida State Sen. John Thrasher, Florida Gov. Rick Scott, U.S. Rep. Ron DeS...
 

 

Lockheed Martin GMLRS alternative warhead logs successful flight test series, shifts to next testing phase

Lockheed Martin successfully conducted the fifth and final Production Qualification Test for the new Guided Multiple Launch Rocket System Alternative Warhead recently at White Sands Missile Range, N.M. During the long-range test, four rockets were fired from a HIMARS launcher and destroyed their respective targets approximately 65 kilometers away. The test is the final milestone...
 
 

Forecast International expects UAV market to rise strongly through next decade

The wars in Iraq and Afghanistan sent unmanned aerial vehicle production to record heights, but with the last U.S. military troops in Afghanistan slated to depart the country this year, the Pentagon’s demand for unmanned air vehicles is slackening. However, while fewer UAVs are expected to roll off the production lines from 2014 to 2023,...
 
 
sikorsky-china

China certifies Sikorsky S-76D™ helicopter

Sikorsky Aircraft Corp. announced April 15 that the Civil Aviation Administration of China has issued a validation type certificate for the S-76D™ aircraft, allowing Sikorsky to begin delivering the commercial helicopter  to...
 




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>