Monday, October 26, 2009

Honeywell International Inc. (HON) Third Quarter Profit Declines but Beats Expectations

Honeywell International Inc., a Fortune 100 diversified technology and manufacturing leader, recently announced that the company’s third-quarter profit fell 15 percent due to slower sales in all its divisions with aviation and industrial products continuing to struggle.

For the third quarter ended September 30, the company earned $608 million, or 80 cents per share, down from $719 million, or 97 cents per share, one year ago. In addition, revenue declined 17 percent to $7.7 billion, down from $9.28 billion during the third quarter of 2008. Analysts surveyed by Thomson Reuters expected lower earnings of 72 cents per share on higher revenue of $7.88 billion.

More than half of Honeywell’s sales are overseas and as a result, the company has been hit by some of the economy’s weakest sectors, including the aerospace, automotive and construction markets. Sales in the company’s aerospace business decreased 16 percent in the third quarter compared with one year ago due to lower volume in commercial aerospace; however, this decline was partly offset by higher military equipment sales and aircraft modifications.

According to the company’s chief financial officer, David J. Anderson, Honeywell believes that it is too early to declare a recovery in certain sectors, but the company anticipates that its turbo business and commercial aerospace repairs and maintenance business to “rebound somewhat” next year.

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