UTC reports third quarter EPS growth of 14 percent
UTC reports third quarter EPS growth of 14 percent, expects 2010 EPS of $4.70, up 14 percent, and increases expected 2010 net restructuring by $100 Million.
United Technologies Corp. reported third quarter 2010 earnings per share of $1.30 and net income attributable to common shareowners of $1.2 billion, up 14 percent and 13 percent, respectively, over the year ago third quarter. Results for the current and prior year quarters included net charges for restructuring and one time items of $0.09 and $0.13 per share, respectively. Before these charges, earnings per share increased 9 percent year over year. Currency hedges at Pratt & Whitney Canada, net of foreign exchange translation, contributed $0.02 to the earnings per share increase.
"UTC's results this quarter reflect solid operating leverage with strong conversion on organic revenue growth," said Louis Chenevert, UTC Chairman & Chief Executive Officer. "Sustained and structural cost reduction actions drove record segment operating margin, while we increased our investment in new game changing technologies. Cash generation continued to be exceptional, and we made additional contributions of $350 million to our domestic pension plans.
"Based on the strong year to date performance, we are raising 2010 earnings per share guidance to $4.70, the high end of our prior range of $4.60 to $4.70, while increasing restructuring, net of one time items, by $100 million," Chenevert added. "As expected, commercial aerospace aftermarket orders have rebounded nicely but the commercial construction markets remain weak. Additional restructuring will further position us for solid earnings growth in the years ahead."
New equipment orders at Otis were down 1 percent over the year ago third quarter. Commercial HVAC new equipment orders at Carrier grew 3 percent including unfavorable foreign exchange of 1 point. Commercial spares orders at Pratt & Whitney's large engine business grew 35 percent and at Hamilton Sundstrand were up 13 percent over the year ago third quarter.
"We expect 2010 earnings per share will grow 14 percent over 2009 on revenues of $54 billion, up 2 percent," Chenevert continued. "We now expect full year cash flow from operations less capital expenditures to exceed 100 percent of net income attributable to common shareowners. UTC's leadership team remains focused on maximizing the potential of our world class franchises and achieving industry leading margins in all of our operating segments."
Share repurchase was $494 million in the quarter and $1.6 billion year to date. Acquisition spend was $183 million in the quarter and $2.6 billion year to date. For the year, UTC expects that share repurchase and acquisition spend will be at least $2 billion and around $3 billion, respectively.
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