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Honeywell Posts Full-Year Sales Results

January 29, 2014

Honeywell announced its results for the fourth quarter and full year 2013. " Honeywell had a very strong fourth quarter, capping off a terrific year across the board with record sales, margins, and earnings," said Honeywell Chairman and CEO Dave Cote . "Even in a continued slow-growth environment, our 2013 sales grew 4 percent and proforma earnings were up 11 percent, above our guidance, exiting the year with better than expected sales in every business. We generated strong margin expansion driven by excellent execution, with benefits from continued traction on our key process and productivity initiatives across the portfolio. We sustained our 'seed planting' investments for the future including innovating new products and technologies, and expanding geographically. We've also proactively funded new repositioning projects by smartly redeploying non-operating gains. Our short-cycle businesses accelerated as we ended the year and our long-cycle order backlog stood at an impressive $15.5 billion . While we think it's prudent to remain cautious on the global economy at this time, we're increasingly confident in our 2014 outlook based on the momentum from the fourth quarter. And, the benefits from smart gain deployment actions position the Company for strong earnings growth and outperformance over the next 5 years." In a release on January 24 , the Company noted that sales were up 3 percent compared with the fourth quarter of 2012 driven by 3 percent Commercial growth and a 2 percent increase in Defense and Space. Commercial original equipment (OE) sales were approximately flat driven by continued OE build rates and favorable platform mix offset by higher payments due to BGA OEM customers. Commercial aftermarket sales were up 5 percent driven by higher airline spares and BGA RMU (Repairs, Modifications, and Upgrades) sales. Defense and Space sales increased 2 percent driven by a royalty gain and international strength offsetting planned program ramp downs. Segment profit was up 6 percent, and segment margins expanded 60 bps to 20.5 percent, primarily due to productivity net of inflation, and commercial excellence, partially offset by investments for growth. BGA OEM payments were offset by a royalty gain in Defense and Space. Sales were up 10 percent reported, up 4 percent organic, compared with the fourth quarter of 2012, primarily driven by the favorable impact of acquisitions, growth in Energy, Safety, and Security due to strong residential end markets, new product introductions, and strength in the Americas Distribution business. Segment profit was up 8 percent and segment margins were down (20) bps to 15.3 percent driven by the dilutive impact of acquisitions, higher Building Solutions and Distribution sales, and continued investments for growth partially offset by volume and productivity net of inflation, including benefits from prior period repositioning. Sales were up 12 percent reported, 9 percent organic, compared with the fourth quarter of 2012, driven by the favorable impact of the Thomas Russell acquisition, increased UOP catalyst and gas processing volume, and improved production volumes in Advanced Materials. Segment profit was up 30 percent and segment margins expanded 210 bps to 15.7 percent in the fourth quarter primarily due to strong volume and productivity, partially offset by continued investments for growth. Sales were up 16 percent reported, 15 percent organic, compared with the fourth quarter of 2012, driven by continued growth from new platform launches, higher global turbo gas penetration and light vehicle production, and an uptick in China commercial vehicle demand. Segment profit was up 41 percent in the fourth quarter and segment margins expanded 250 bps to 13.6 percent primarily driven by strong Turbo material productivity and volume leverage, and operational improvements in Friction Materials. Honeywell is a Fortune 100 diversified technology and manufacturing company. More information: ((Comments on this story may be sent to ))

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