(Corrects name in third paragraph)
April 17 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
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
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.
Shares of Honeywell rose slightly to $93.51 in premarket
(Reporting by Ernest Scheyder and Lewis Krauskopf; Editing by