CORRECTED-UPDATE 2-Turbocharger sales help Honeywell profit zoom past expectations
(Corrects name in third paragraph)
April 17 (Reuters) - Diversified manufacturer Honeywell International Inc posted a better-than-expected quarterly profit on Thursday, helped by strong sales of automobile turbochargers in the United States and China.
The company, which also makes airplane cockpit parts, chemicals for the energy industry and scores of other electronics and equipment, said it is "cautiously optimistic" on the health of the global economy and that it still expects profit to rise at least 9 percent this year.
"We remain confident in our outlook and intend to perform better than our peers," Chief Executive Dave Cote said in a statement.
One of the company's brightest spots during the quarter was its Transportation Systems unit, which saw profit jump 39 percent, helped largely by demand for turbochargers, devices that boost an engine's torque.
While the unit is Honeywell's smallest, executives see it as one of the fastest-growing. Indeed, in a revised forecast announced on Thursday, Honeywell cut its 2014 margin outlook for its three other units, but raised the margin outlook for the Transportation Systems unit.
The company posted first-quarter net income of $1.02 billion, or $1.28 per share, compared with $966 million, or $1.23 per share, in the year-ago quarter.
By that measure, analysts expected earnings of $1.26 per share, according to Thomson Reuters I/B/E/S.
Net sales rose 4 percent to $9.68 billion, missing the $9.74 billion estimate from Wall Street.
Honeywell last month set a target to boost annual sales to more than $50 billion by 2018 and to spend $10 billion on acquisitions. Honeywell posted $39.1 billion in sales last year.
The New Jersey-based company expects high-growth regions such as China to drive about half its sales growth over the next five years, with profit margins for its business segments increasing to between 18.5 percent to 20 percent over that time, up from 16.5 percent for the first quarter.
The $10 billion in acquisitions targeted by the company is more than twice as much as Honeywell spent on deals in the previous five years. Honeywell and other industrial conglomerates are eager to bolster their operations through deals but may hesitate due to high valuations of targets.
Also on Thursday, Honeywell lifted the bottom end of its 2014 earnings forecast. The company now expects to earn $5.40 to $5.55 per share this year, where previously the bottom end of that range had been $5.35 per share.
Wall Street expects the company to earn $5.54 per share this year.
Honeywell this month elevated two executives to the newly created position of vice chairman, with each of them taking responsibility for aspects of the five-year financial plan.