Aerospace Boosts UTC Earnings

Jan 21, 2009
Jim Swickard



Growth at Sikorsky and solid Pratt & Whitney business helped boost United Technologies' (UTC) fourth-quarter 2008 income by 8 percent, offsetting declines at its Carrier subsidiary, the company announced this morning.

The Hartford, CT-based company reported fourth quarter earnings came to $1.15 billion, or $1.23 per diluted share, compared with $1.1 billion, or $1.08 per share, a year earlier.

Consolidated revenues for the quarter at $14.5 billion were lower than last year by 1 percent, with 3 points of organic growth more than offset by 5 points of adverse foreign exchange translation. Cash flow from operations was $2.0 billion and, after capital expenditures of $406 million, substantially exceeded fourth quarter net income.

"UTC had a solid close to 2008 in spite of deteriorating end markets and currency headwinds. Solid margin expansion at the aerospace units and at UTC Fire & Security offset the impact of a sharp decline at Carrier," said UTC President and CEO Louis Chýýnevert. "Balance works at UTC. While Carrier saw organic revenue decline 7 percent in the quarter, all other units reported organic growth with Sikorsky at an exceptional 25 percent. Commercial aerospace spares orders in the quarter were just below sales at Pratt & Whitney and just above sales at Hamilton Sundstrand."

Full year earnings per share of $4.90 and net income of $4.7 billion increased 15 and 11 percent, respectively, from 2007 results. Revenues increased 7 percent to $58.7 billion, including 5 points of organic growth, 1 point foreign exchange, and 1 point net acquisitions. Full year cash flow from operations was $6.2 billion and capital expenditures were $1.2 billion.

"We remain confident that UTC's strong global franchises and experienced management team will continue to outperform even in this environment," Chýýnevert said. He went on to confirm the conglomerate's expectation for earnings per share of $4.65 to $5.15 in 2009.

Photo of Sikorsky S-76A: Sikorsky