Honeywell’s third quarter sales up 14 pc

The company’s third quarter earnings of $1.10 per share posted an increase of 45 per cent over $0.76 in the third quarter last year.  Honeywell is raising its 2011 sales and EPS outlook and now expects 2011 sales of $36.5 - 36.7 billion, up approximately 13 per cent over 2010.

“Honeywell’s strong third quarter results are a continuation of the momentum we’ve seen across our businesses in 2011,” said Honeywell chairman and CEO Dave Cote.  “Our third quarter sales growth reflects a particularly robust commercial aerospace upcycle, with growth in both original equipment and aftermarket sales. It also highlights the company’s extensive innovation pipeline and increasing presence in high growth regions in all our businesses.”  

“Despite signals of slower economic growth, we expect positive organic growth to continue the rest of this year and into 2012,” added Cote. “The repositioning actions we took in the third quarter, funded by non-operational gains, better position our businesses for 2012 and beyond. These repositioning tailwinds, combined with our great positions in good industries, execution track record, and disciplined playbook, will be keys to our continued outperformance.”

Honeywell’s sales in aerospace were up 8 per cent compared with the third quarter of 2010, primarily due to 20 per cent growth in Commercial original equipment and aftermarket volumes, partially offset by lower military and government services sales.

This segment profit was up 16 per cent and segment margin increased 120 bps to 18.2 per cent, primarily due to increased volume, favorable mix, and productivity net of inflation, partially offset by higher research and development costs.

Honeywell has been chosen by Air China to provide a comprehensive suite of avionics components for its new fleet of 30 B737NG aircraft.  Air China also selected Honeywell’s SmartRunway on all of its future incoming aircraft.

In automation and control solutions segment, the firm’s sales were up 14 per cent, compared with the third quarter of 2010, with 6 per cent growth from acquisitions net of divestitures, 4 per cent impact from favorable foreign exchange and 4 per cent organic growth due to higher products volumes and solutions sales.  

This segment profit was up 15 per cent and segment margins increased 20 bps to 13.8 per cent driven by higher volumes and project sales, partially offset by inflation and investment for growth across the portfolio.

Building solutions was awarded a $20.5 million contract at Heathrow Airport’s new Terminal 2 in London to provide an integrated fire safety, public address, and voice alarm system that will help ensure the more than 20 million passengers expected to pass through the terminal have a safe and comfortable travel experience.

Honeywell’s sales in transportation and systems were up 22 per cent compared with the third quarter of 2010, due to higher global passenger and commercial vehicle turbo volumes overall, new platform launches, and 9 per cent favourable impact from foreign exchange.

Meanwhile, the firm’s profit of specialty materials was up 31 per cent and segment margins increased 80 bps to 17.3 per cent due to favorable price over raw spreads, higher project sales and catalyst growth, and productivity, partially offset by inflation and the unfavourable margin impact from the phenol plant acquisition.