Market Snapshot
  • U.S.
  • Europe
  • Asia
Ticker Volume Price Price Delta
DJIA 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 2.54 0.14%
NASDAQ 4,095.52 9.29 0.23%
Ticker Volume Price Price Delta
STOXX 50 3,155.81 16.55 0.53%
FTSE 100 6,625.25 41.08 0.62%
DAX 9,409.71 91.89 0.99%
Ticker Volume Price Price Delta
NIKKEI 14,512.38 -3.89 -0.03%
TOPIX 1,171.40 -1.97 -0.17%
HANG SENG 22,760.24 64.23 0.28%

HONEYWELL INTERNATIONAL INC: Final Results


Honeywell Reports Full Year Sales Up 3% to $37.7 Billion; Proforma Earnings Per

Share Up 11% to $4.48 Per Share; Reported Earnings Per Share of $3.69

- 2012 Earnings Growth Driven By Strong Operational Performance

- Record Segment Margin Of 15.6%, Up 90 bps YoY; Operating Margin 13.6% Up 160 bps YoY

- Pension Mark-to-Market Adjustment As Expected - ($0.79) Per Share

- Reaffirming 2013 Proforma EPS Guidance Of $4.75-4.95, Up Another 6-11% Over 2012

MORRIS TOWNSHIP, N.J., Jan. 25, 2013 -- Honeywell (NYSE: HON) today announced its results for the fourth quarter and full year 2012:

Total Honeywell

($ Millions, except Earnings Per Share) FY 2011 FY 2012 Change

Sales 36,529 37,665 3%

Segment Margin 14.7% 15.6% 90 bps Operating Income Margin(1) 12.0% 13.6% 160 bps

Earnings Per Share (Reported) $2.61 $3.69 41% Earnings Per Share (Proforma)(1) $4.05 $4.48 11%

Cash Flow from Operations 2,833 3,517 24% Free Cash Flow(2) 3,780 3,672 (3%)


                                                                               
                                                                               
                                                  4Q 2011   4Q 2012      Change 

Sales                                               9,473     9,581           
1%   

Segment Margin 15.1% 15.6% 50 bps Operating Income Margin(1) 12.9% 13.9% 100 bps

Earnings Per Share (Reported) ($0.40) $0.32 N/A Earnings Per Share (Proforma)(1) $1.05 $1.10 5%

Cash Flow from Operations 1,477 1,349 (9%) Free Cash Flow(2) 1,417 1,311 (7%)

1. Proforma, V%/bps Exclude Any Pension Mark-to-Market Adjustment

2. Free Cash Flow (Cash Flow from Operations Less Capital Expenditures) Prior

to Cash Pension Contributions

"Honeywell had another year of terrific performance in 2012," said Honeywell Chairman and CEO Dave Cote. "In a weak global economy, we grew sales 3% and earnings by 11%, while expanding margins to record levels and continuing to generate strong cash flow. We outperformed while also continuing to invest in seed planting initiatives like new products and services, global growth, cost competitiveness, and strengthening our key processes -- Honeywell Operating System, Velocity Product Development™, and Functional Transformation. Our balanced mix of long- and short-cycle businesses and expansion in high growth regions has offset lower demand in some of our short-cycle businesses, European weakness, and foreign exchange headwinds. We've also maintained a strong long-cycle backlog, now a record $15.8 billion, with new platform wins across many of our businesses last year. These positive trends, combined with our great positions in good industries, conservative planning, and the continued evolution of our internal processes will help Honeywell drive sales, margin growth, cash generation, and EPS outperformance in 2013 and over the long-term."

The company is also reaffirming its full-year 2013 sales and EPS guidance:

Full Year Guidance


                                                      
                                 2013           Change     
                            Current Guidance   vs. 2012   

Sales $39.0 - $39.5B 4 - 5%

Segment Margin 15.8 - 16.1% 20 - 50 bps

Operating Income Margin(1) 14.2 - 14.5% 60 - 90 bps

Earnings Per Share(1) $4.75 - $4.95 6 - 11%

Free Cash Flow(2) ~$3.7B ~Flat

1. Proforma, V% / bps Exclude Any Pension Mark-to-Market Adjustment

2. Free Cash Flow (Cash Flow from Operations Less Capital Expenditures) Prior to Any NARCO Related Payments and Cash Pension Contributions

Segment Performance

Aerospace

($ Millions) FY 2011 FY 2012 % Change

Sales 11,475 12,040 5% Segment Profit 2,023 2,279 13% Segment Margin 17.6% 18.9% 130 bps

4Q 2011 4Q 2012 % Change Sales 3,047 3,020 (1%) Segment Profit 573 601 5% Segment Margin 18.8% 19.9% 110 bps


                                       

  * Sales were down (1%) compared with the fourth quarter of 2011 driven by a
    (6%) decline in Defense and Space, partially offset by a 3% increase in our
    commercial end markets. Commercial original equipment (OE) sales were up 5%
    driven by increased production rates at our major OE customers. Commercial

aftermarket sales were up 3% driven by higher maintenance activity. * Segment profit was up 5%, and segment margins expanded 110 bps to 19.9%,

primarily due to commercial excellence, productivity net of inflation, and

lower BGA OE payments, partially offset by investments for growth.

Automation and Control Solutions ($ Millions) FY 2011 FY 2012 % Change Sales 15,535 15,880 2% Segment Profit 2,083 2,232 7% Segment Margin 13.4% 14.1% 70 bps

($ Millions) 4Q 2011 4Q 2012 % Change Sales 4,051 4,172 3% Segment Profit 584 645 10% Segment Margin 14.4% 15.5% 110 bps


                                                         

  * Sales were up 3% compared with the fourth quarter of 2011 as volume growth
    and the favorable impact of acquisitions, net of divestitures was partially
    offset by foreign exchange headwinds. Energy, Safety, and Security was up
    4% organically due to acceleration of growth in Environmental and
    Combustion Controls and continued growth in Scanning & Mobility and
    Security. Process Solutions and Building Solutions and Distribution grew at
    a slower rate, reflecting a more challenging capital investment

environment. * Segment profit was up 10% and segment margins were up 110 bps to 15.5%


    driven by commercial excellence and strong productivity net of inflation
    and other investments for growth, including the favorable impact of
    previously completed restructuring actions.

Performance Materials and Technologies                          
 ($ Millions)                           FY 2011 FY 2012  % Change 
Sales                                     5,659   6,184        9%   
Segment Profit                            1,042   1,154       11%   
Segment Margin                             18.4%   18.7%   30 bps   

($ Millions) 4Q 2011 4Q 2012 % Change Sales 1,430 1,545 8% Segment Profit 223 210 (6%) Segment Margin 15.6% 13.6% (200 bps)


                                                                

  * Sales were up 8% reported, 2% organic, compared with the fourth quarter of
    2011, resulting from the Thomas Russell acquisition in UOP, partially
    offset by lower volume of petrochemical and refining catalysts. Advanced
    Materials sales were up 5% driven by new products and applications,

partially offset by challenging end market conditions. * Segment profit declined (6%) and segment margins contracted (200 bps) to


    13.6% in the fourth quarter primarily due to lower catalyst sales in UOP,
    unfavorable price/raws spread in Resins and Chemicals and challenging end
    market conditions, partially offset by productivity net of labor inflation
    and investments for growth.

Transportation Systems ($ Millions) FY 2011 FY 2012 % Change

Sales 3,859 3,561 (8%) Segment Profit 485 432 (11%) Segment Margin 12.6% 12.1% (50 bps)

($ Millions) 4Q 2011 4Q 2012 % Change Sales 944 844 (11%) Segment Profit 117 94 (20%) Segment Margin 12.4% 11.1% (130 bps)


                                                

  * Sales were down (11%), down (8%) organic, compared with the fourth quarter
    of 2011, driven by lower European light vehicle production and aftermarket
    sales, partially offset by new platform launches and higher gas turbo

penetration, primarily in the U.S. and China. * Segment profit was down (20%) in the fourth quarter and segment margins


    decreased (130 bps) to 11.1% primarily driven by lower sales volumes and
    price, unfavorable foreign exchange, and ongoing projects to drive
    operational improvement in the Friction Materials business, partially
    offset by productivity benefits.

Honeywell will discuss its results during its investor conference call today
starting at 9:00 a.m. EST. To participate on the conference call, please dial
(800) 862-9098 (domestic) or (785) 424-1051 (international) a few minutes
before the 9:00 a.m. EST start. Please mention to the operator that you are
dialing in for Honeywell's fourth quarter 2012 earnings call or provide the
conference code, HONQ412. You can hear a replay of the conference call from 12:
00 p.m. EST, January 25, until 11:59 p.m. EST, February 1, by dialing (800)
374-1216 (domestic) or (402) 220-0681 (international).

A real-time audio webcast of the presentation can be accessed at 
http://www.honeywell.com/investor , where related materials will be posted 
prior to the presentation. The presentation materials will be in Adobe Acrobat 
format. A replay of the webcast will be available following the presentation 
at the same link listed above for 30 days.

Honeywell (www.honeywell.com ) is a Fortune 100 diversified technology and
manufacturing leader, serving customers worldwide with aerospace products and
services; control technologies for buildings, homes, and industry; automotive
products; turbochargers; and performance materials. Based in Morris Township,
N.J., Honeywell's shares are traded on the New York, London, and Chicago Stock
Exchanges. For more news and information on Honeywell, please visit 
www.honeywellnow.com .

This release contains certain statements that may be deemed "forward-looking
statements" within the meaning of Section 21E of the Securities Exchange Act of
1934. All statements, other than statements of historical fact, that address
activities, events or developments that we or our management intends, expects,
projects, believes or anticipates will or may occur in the future are
forward-looking statements. Such statements are based upon certain assumptions
and assessments made by our management in light of their experience and their
perception of historical trends, current economic and industry conditions,
expected future developments and other factors they believe to be appropriate.
The forward-looking statements included in this release are also subject to a
number of material risks and uncertainties, including but not limited to
economic, competitive, governmental, and technological factors affecting our
operations, markets, products, services and prices. Such forward-looking
statements are not guarantees of future performance, and actual results,
developments and business decisions may differ from those envisaged by such
forward-looking statements.

Contacts:                                        

Media Investor Relations Robert C. Ferris Elena Doom (973) 455-3388 (973) 455-2222 rob.ferris@honeywell.comelena.doom@honeywell.com


                                                 
                                 Honeywell International Inc
                      Consolidated Statement of Operations (Unaudited)
                             (In millions, except per share amounts) 
                                                                                
               

Three Months Twelve Months


                                                                 Ended          
     Ended   

December 31,

December 31,

2012 2011 2012 2011

Product sales $ 7,628 $ 7,478 $ 29,812 $ 28,745 Service sales 1,953 1,995 7,853 7,784 Net sales 9,581 9,473 37,665 36,529

Costs, expenses and other

Cost of products sold (A) 6,302 6,862 22,929 23,220

Cost of services sold (A) 1,379 1,573 5,362 5,336

7,681 8,435 28,291 28,556

Selling, general and administrative expenses (A) 1,523 1,616 5,218 5,399

Other (income) expense (16) (12)

(70) (84)

Interest and other financial charges 87 91

351 376


                                                                                
               

9,275 10,130 33,790 34,247

Income (loss) from continuing operations before taxes 306 (657) 3,875 2,282 Tax expense (benefit) 51 (350)

944 417

Income (loss) from continuing operations after taxes 255 (307) 2,931 1,865

Income from discontinued operations after taxes - -

- 209

Net income (loss) 255 (307) 2,931 2,074

Less: Net income attributable to the noncontrolling interest 4 3

5 7 Net income (loss) attributable to Honeywell $ 251 $ (310) $ 2,926 $ 2,067

Amounts attributable to Honeywell:

Income (loss) from continuing operations less net income

attributable to the noncontrolling interest 251 (310) 2,926 1,858

Income from discontinued operations - -

- 209

Net income (loss) attributable to Honeywell $ 251 $ (310) $ 2,926 $ 2,067

Earnings per share of common stock - basic:

Income (loss) from continuing operations 0.32 (0.40) 3.74 2.38 Income from discontinued operations - -

- 0.27 Net income (loss) attributable to Honeywell $ 0.32 $ (0.40) $ 3.74 $ 2.65

Earnings per share of common stock - assuming dilution:

Income (loss) from continuing operations 0.32 (0.40) 3.69 2.35 Income from discontinued operations - -

- 0.26 Net income (loss) attributable to Honeywell $ 0.32 $ (0.40) $ 3.69 $ 2.61

Weighted average number of shares outstanding-basic 787.2 774.7 782.4 780.8

Weighted average number of shares outstanding -

assuming dilution 796.4 784.3 791.9 791.6


                                                                                
               

(A) Cost of products and services sold and selling, general and administrative

expenses include amounts for repositioning and other charges, pension and other

postretirement expense, and stock compensation expense.

(B) Below is a reconciliation of Earnings per share to Earnings per share,

excluding mark-to-market pension expense. We believe this measure is useful to


    investors and management in understanding our ongoing operations and in   
    analysis of ongoing operating trends.                 
                                                                                
               
                                                                                
               

Three Months Ended Twelve Months Ended


                                                                December 31,    
     December 31,  
                                                                                
               

2012(1) 2011(1) 2012(1) 2011(1)

Earnings per share of common stock - assuming dilution $ 0.32 $ (0.40) $ 3.69 $ 2.61 Mark-to-market pension expense 0.78 1.45

0.79 1.44

Earnings per share of common stock - assuming dilution,

excluding mark-to-market pension expense $ 1.10 $ 1.05 $ 4.48 $ 4.05


                                                                                
               
                                                                                

1- EPS utilizes weighted average shares outstanding and the effective tax rate

for the period. Mark-to-market uses a blended tax rate of 35.0% and 36.9% for

2012 and 2011, respectively


               
                                        Honeywell International Inc 
                                      Segment Data (Unaudited)      
                                        (Dollars in millions)
                                                                               

Three Months Ended Twelve Months Ended

December 31, December 31, Net Sales 2012 2011 2012 2011

Aerospace $ 3,020 $ 3,047 $ 12,040 $ 11,475

Automation and Control Solutions 4,172 4,051 15,880 15,535

Performance Materials and Technologies 1,545 1,430 6,184 5,659

Transportation Systems 844 944 3,561 3,859

Corporate - 1 -


      1   
    

Total $ 9,581 $ 9,473 $ 37,665 $ 36,529

Reconciliation of Segment Profit to Income From Continuing Operations Before Taxes

Three Months Ended Twelve Months Ended

December 31, December 31,

Segment Profit 2012 2011 2012 2011

Aerospace $ 601 $ 573 $ 2,279 $ 2,023

Automation and Control Solutions 645 584 2,232 2,083

Performance Materials and Technologies 210 223 1,154 1,042

Transportation Systems 94 117 432

485

Corporate (54) (68) (218) (276)

Total Segment Profit 1,496 1,429 5,879 5,357

Other income (expense) (A) 7 (3) 25

33 Interest and other financial charges (87) (91) (351) (376) Stock compensation expense (B) (39) (39) (170) (168) Pension ongoing expense (B) (7) (22) (36) (105) Pension mark-to-market expense (B) (957) (1,802) (957) (1,802) Other postretirement income/(expense) (B) (20) (23) (72)

86 Repositioning and other charges (B) (87) (106) (443) (743) Income (loss) from continuing operations before taxes $ 306 $ (657) $ 3,875 $ 2,282

(A) Equity income/(loss) of affiliated companies is included in Segment Profit.


                                                                               
    (B) Amounts included in cost of products and services sold and selling,    
        general and administrative expenses. 
                                                                               
                                       Honeywell International Inc   
                                  Consolidated Balance Sheet (Unaudited)  
                                           (Dollars in millions)
                                                                               
                                             December 31,        December 31,   
    
                                                 2012               2011        

ASSETS

Current assets:


                                                                               
    Cash and cash equivalents              $         4,634   $           3,698 
    Accounts, notes and other receivables            7,429               7,228  
        Inventories                                      4,235               4,264  
    
    Deferred income taxes                              669                 460  
    Investments and other current assets               631                 484  
          Total current assets                         17,598              16,134  
      

Investments and long-term receivables 623 494

Property, plant and equipment - net 5,001 4,804

Goodwill 12,425 11,858

Other intangible assets - net 2,449 2,477

Insurance recoveries for asbestos related liabilities 663 709

Deferred income taxes 1,889 2,132


    Other assets                                         1,205               1,200  
                                                                                 
       Total assets                         $       41,853    $         39,808  
                                                                               

LIABILITIES AND SHAREOWNERS' EQUITY Current liabilities:


    Accounts payable                       $         4,736   $           4,738 
    Short-term borrowings                               76                  60  
    Commercial paper                                   400                 599  
    Current maturities of long-term debt               625                  15
    Accrued liabilities                              7,208               6,863  
       Total current liabilities                    13,045              12,275  

Long-term debt 6,395 6,881

Deferred income taxes 628 676

Postretirement benefit obligations other than pensions 1,365 1,417

Asbestos related liabilities 1,292 1,499

Other liabilities 5,913 6,158

Redeemable noncontrolling interest 150 -

Shareowners' equity 13,065 10,902


      
                                                                               
                                                                               
       Total liabilities, redeemable                                           
        noncontrolling interest and          
        shareowners' equity                $        41,853    $         39,808  
    
                                                                               
                                               Honeywell International Inc

Consolidated Statement of Cash Flows (Unaudited)


                                                  (Dollars in millions)         
                                                                                

Three Months Twelve Months

Ended Ended

December 31, December 31,

2012

2011 2012 2011 Cash flows from operating activities:

Net income (loss) attributable to Honeywell $ 251 $ (310) $ 2,926 $ 2,067


    Adjustments to reconcile net income (loss) attributable to 
     Honeywell to net cash provided  by operating activities: 
                                                                    

Depreciation and amortization 245 253 926 957

Gain on sale of non-strategic businesses and assets (2) (9) (5) (362)

Repositioning and other charges 87 106 443 743

Net payments for repositioning and other charges (151) (133) (503) (468)

Pension and other postretirement expense 984 1,847 1,065 1,823

Pension and other postretirement benefit payments (295) (315) (1,183) (1,883)

Stock compensation expense 39 39 170 168

Deferred income taxes (235) (528) 84 (331)

Excess tax benefits from share based payment arrangements (28) (11) (56) (42)

Other 69 233 108 289


        Changes in assets and liabilities, net of the effects of                
            
         acquisitions and divestitures:                                         
              
                                                                                
             

Accounts, notes and other receivables 41 117 (119) (316)

Inventories 78 130 25 (310)

Other current assets (1) 78 (78) 25

Accounts payable 207 162 (13) 527

Accrued liabilities 60 (182) (273) (54)

Net cash provided by operating activities 1,349 1,477 3,517 2,833

Cash flows from investing activities:

Expenditures for property, plant and equipment (298) (332) (884) (798)

Proceeds from disposals of property, plant and equipment 3 3 5 6

Increase in investments (220) (58) (702) (380)

Decrease in investments 272 66 559 354

Cash paid for acquisitions, net of cash acquired (376) (346) (438) (973)

Proceeds from sales of businesses, net of fees paid 3 (14) 21 1,156

Other 53 (43) 11 24

Net cash used for investing activities (563) (724) (1,428) (611)

Cash flows from financing activities:

Net (decrease)/increase in commercial paper (499) (101) (199) 300

Net increase/(decrease) in short-term borrowings 3 2 22 (2)


    Payment of debt assumed with acquisitions                                 - 
       (33)       -        (33)     

Proceeds from issuance of common stock 163 72 342 304

Proceeds from issuance of long-term debt 16 1 102 1,390

Payments of long-term debt (1) (500) (1) (939)

Excess tax benefits from share based payment arrangements 28 11 56 42

Repurchases of common stock (317) (76) (317) (1,085)

Cash dividends paid (331) (295) (1,211) (1,091)

Net cash used for financing activities (938) (919) (1,206) (1,114)

Effect of foreign exchange rate changes on cash and cash equivalents 26 (21) 53 (60) Net (decrease)/increase in cash and cash equivalents (126) (187) 936 1,048 Cash and cash equivalents at beginning of period 4,760 3,885 3,698 2,650 Cash and cash equivalents at end of period $ 4,634 $ 3,698 $ 4,634 $ 3,698


                                                                                
    
                                                                                
                                      Honeywell International Inc  

Reconciliation of Cash Provided by Operating Activities to Free Cash Flow,


                           Prior to Cash Pension Contributions (Unaudited)      
                                              (Dollars in millions)     
                                                                               

Three Months Ended

Twelve Months Ended


                                                              December 31,      
        December 31,        
                                                          2012         2011     
    2012          2011      
                                                                               

Cash provided by operating activities $ 1,349 $ 1,477 $ 3,517 $ 2,833

Expenditures for property, plant and equipment (298) (332)

(884) (798)

Free cash flow $ 1,051 $ 1,145 $ 2,633 $ 2,035

Cash pension contributions 260 272

1,039 1,745

Free cash flow, prior to cash pension contributions $ 1,311 $ 1,417 $ 3,672 $ 3,780

We define free cash flow as cash provided by operating activities, less cash expenditures for property, plant and equipment.

We believe that this metric is useful to investors and management as a measure of cash generated by business operations that will be used to repay scheduled debt maturities and can be used to invest in future growth through new business development activities or acquisitions, and to pay dividends, repurchase stock, repay debt obligations prior to their maturities, or make cash pension contributions. This metric can also be used to evaluate our ability to generate cash flow from business operations and the impact that this cash flow has on our liquidity.


                                                                               
                                                                               
                                    Honeywell International Inc.             

Reconciliation of Segment Profit to Operating Income Excluding Pension

Mark-to-Market Adjustment and Calculation of Segment Profit and Operating

Income Margin Excluding Pension Mark-to-Market Adjustment (Unaudited)


                                      (Dollars in millions)        
                                                                               

Three Months Ended Twelve Months Ended

December 31, December 31,


                                                                               
                                               2012          2011         2012  
       2011        

Segment Profit $ 1,496 $ 1,429 $ 5,879 $ 5,357

Stock compensation expense (A) (39) (39) (170) (168)

Repositioning and other (A, B) (96) (121) (488) (794)

Pension ongoing expense (A) (7) (22) (36) (105)

Pension mark-to-market adjustment (A) (957) (1,802) (957) (1,802)

Other postretirement income/(expense) (A) (20) (23) (72) 86

Operating Income (Loss) $ 377 $ (578) $ 4,156 $ 2,574

Pension mark-to-market adjustment (A) $ (957) $ (1,802) $ (957) $ (1,802)

Operating Income excluding pension mark-to-market adjustment $ 1,334 $ 1,224 $ 5,113 $ 4,376

Segment Profit $ 1,496 $ 1,429 $ 5,879 $ 5,357 ÷ Sales $ 9,581 $ 9,473 $ 37,665 $ 36,529 Segment Profit Margin % 15.6% 15.1% 15.6% 14.7%

Operating Income (Loss) $ 377 $ (578) $ 4,156 $ 2,574 ÷ Sales $ 9,581 $ 9,473 $ 37,665 $ 36,529 Operating Income (Loss) Margin % 3.9% (6.1%) 11.0% 7.0%

Operating Income excluding pension

mark-to-market adjustment $ 1,334 $ 1,224 $ 5,113 $ 4,376 ÷ Sales $ 9,581 $ 9,473 $ 37,665 $ 36,529 Operating Income Margin excluding pension mark-to-market adjustment % 13.9% 12.9% 13.6% 12.0%


                                                                              
                                                                               

(A) Included in cost of products and services sold and selling, general and


    administrative expenses.                                                    
    (B) Includes repositioning, asbestos, environmental expenses and equity        
    income adjustment.                                                          

We believe these measures are useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

SOURCE Honeywell

END

-0- Jan/25/2013 13:50 GMT

Sponsored Links
Advertisement
Advertisements
Sponsored Links
Advertisement