Honeywell cuts full-year sales target on parts shortage
Oct 22 (Reuters) - Honeywell International Inc (HON.O) on Friday cut its full-year sales forecast, as global supply chain disruptions cause a shortage of parts and components for the U.S. industrial conglomerate.
Closed ports due to a resurgence of COVID-19 cases in Asia, aggravated by the fast-spreading Delta variant, and labor shortages have strained global supply chains as well as led to a surge in raw material prices.
Honeywell said a shortage of parts had curtailed production in its biggest segment, the aerospace unit. It also said an electronic component shortage was hurting its safety and productivity solutions unit, which houses the automation equipment business used by customers including Amazon.Com Inc (AMZN.O).
The company cut its full-year sales estimates to between $34.2 billion and $34.6 billion, compared with its prior forecast of $34.6 billion to $35.2 billion to "reflect the persistent effects of the macro-challenged environment".
Analysts, on average, had expected full-year sales of $35.10 billion, according to Refinitiv IBES estimate.
Honeywell also narrowed full-year profit forecast range to $8.00 to $8.10, from $7.95 to $8.10 earlier.
Shares of the company fell 1.6% premarket. They have risen nearly 6% for the year.
Excluding one-time items, Honeywell earned $2.02 per share, beating estimates of $1.99 per share for the third-quarter ended Sept. 30, benefiting from a rise in commercial and business aviation.
Net sales rose to $8.47 billion from $7.80 billion a year earlier, but missed analysts' average estimate of $8.65 billion.
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