Honeywell Reports Full Year Sales Up 3% to $37.7 Billion; Proforma Earnings Per Share Up 11% to $4.48 Per Share; Reported

 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

PR Newswire

MORRIS TOWNSHIP, N.J., Jan. 25, 2013

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

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

  oSales 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.
  oSegment 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

  oSales 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.
  oSegment 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)

  oSales 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.
  oSegment 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)

  oSales 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.
  oSegment 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.com elena.doom@honeywell.com

Honeywell International Inc
Consolidated Statement of Operations (Unaudited)
(In millions, except per share amounts)
                                Three Months Ended      Twelve Months 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      1,523       1,616       5,218        5,399
administrative expenses (A)
   Other (income) expense    (16)        (12)        (70)         (84)
   Interest and other        87          91          351          376
financial charges
                                9,275       10,130      33,790       34,247
Income (loss) from continuing   306         (657)       3,875        2,282
operations before taxes
Tax expense (benefit)           51          (350)       944          417
Income (loss) from continuing   255         (307)       2,931        1,865
operations after taxes
Income from discontinued        -           -           -            209
operations after taxes
Net income (loss)               255         (307)       2,931        2,074
Less: Net income attributable   4           3           5            7
to the noncontrolling interest
Net income (loss) attributable  $ 251       $ (310)     $ 2,926      $ 2,067
to Honeywell
Amounts attributable to
Honeywell:
    Income (loss) from
    continuing operations less
    net income
    attributable to the         251         (310)       2,926        1,858
    noncontrolling interest
    Income from discontinued    -           -           -            209
    operations
    Net income (loss)           $ 251       $ (310)     $ 2,926      $ 2,067
    attributable to Honeywell
Earnings per share of common
stock - basic:
 Income (loss) from continuing 0.32        (0.40)      3.74         2.38
operations
 Income from discontinued      -           -           -            0.27
operations
 Net income (loss)             $ 0.32      $ (0.40)    $ 3.74       $ 2.65
attributable to Honeywell
Earnings per share of common
stock - assuming dilution:
 Income (loss) from continuing 0.32        (0.40)      3.69         2.35
operations
 Income from discontinued      -           -           -            0.26
operations
 Net income (loss)             $ 0.32      $ (0.40)    $ 3.69       $ 2.61
attributable to Honeywell
Weighted average number of      787.2       774.7       782.4        780.8
shares outstanding-basic
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     $ 0.32      $ (0.40)    $ 3.69       $ 2.61
    dilution
    Mark-to-market pension      0.78        1.45        0.79         1.44
    expense
    Earnings per share of
    common stock - assuming
    dilution,
    excluding mark-to-market    $ 1.10      $ 1.05      $ 4.48       $ 4.05
    pension expense
    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          4,172      4,051        15,880      15,535
Solutions
Performance Materials and       1,545      1,430        6,184       5,659
Technologies
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                       $        $   573   $         $  
                                601                    2,279       2,023
Automation and Control          645        584          2,232       2,083
Solutions
Performance Materials and       210        223          1,154       1,042
Technologies
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    (87)       (91)         (351)       (376)
charges
Stock compensation expense (B)  (39)       (39)         (170)       (168)
Pension ongoing expense (B)     (7)        (22)         (36)        (105)
Pension mark-to-market expense  (957)      (1,802)      (957)       (1,802)
(B)
Other postretirement            (20)       (23)         (72)        86
income/(expense) (B)
Repositioning and other charges (87)       (106)        (443)       (743)
(B)
Income (loss) from continuing   $        $   (657)  $         $  2,282
operations before taxes         306                    3,875
 (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       663               709
liabilities
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   1,365             1,417
pensions
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            $    41,853    39,808
         shareowners' equity

Honeywell International Inc
Consolidated Statement of Cash Flows (Unaudited)
(Dollars in millions)
                                      Three Months Ended   Twelve Months Ended
                                      December 31,         December 31,
                                      2012      2011       2012       2011
Cash flows from operating
activities:
 Net income (loss) attributable    $  251  $  (310)  $ 2,926    $ 2,067
to Honeywell
 Adjustments to reconcile net
income (loss) attributable to
Honeywell to net
 cash provided by operating
activities:
 Depreciation and              245       253        926        957
amortization
 Gain on sale of               (2)       (9)        (5)        (362)
non-strategic businesses and assets
 Repositioning and other       87        106        443        743
charges
 Net payments for              (151)     (133)      (503)      (468)
repositioning and other charges
 Pension and other             984       1,847      1,065      1,823
postretirement expense
 Pension and other             (295)     (315)      (1,183)    (1,883)
postretirement benefit payments
 Stock compensation expense    39        39         170        168
 Deferred income taxes         (235)     (528)      84         (331)
 Excess tax benefits from      (28)      (11)       (56)       (42)
share based payment arrangements
 Other                         69        233        108        289
 Changes in assets and
liabilities, net of the effects of
 acquisitions and
divestitures:
 Accounts, notes and other  41        117        (119)      (316)
receivables
 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        1,349     1,477      3,517      2,833
activities
Cash flows from investing
activities:
 Expenditures for property, plant  (298)     (332)      (884)      (798)
and equipment
 Proceeds from disposals of        3         3          5          6
property, plant and equipment
 Increase in investments           (220)     (58)       (702)      (380)
 Decrease in investments           272       66         559        354
 Cash paid for acquisitions, net   (376)     (346)      (438)      (973)
of cash acquired
 Proceeds from sales of            3         (14)       21         1,156
businesses, net of fees paid
 Other                             53        (43)       11         24
Net cash used for investing           (563)     (724)      (1,428)    (611)
activities
Cash flows from financing
activities:
 Net (decrease)/increase in        (499)     (101)      (199)      300
commercial paper
 Net increase/(decrease) in        3         2          22         (2)
short-term borrowings
 Payment of debt assumed with      -         (33)       -          (33)
acquisitions
 Proceeds from issuance of common  163       72         342        304
stock
 Proceeds from issuance of         16        1          102        1,390
long-term debt
 Payments of long-term debt        (1)       (500)      (1)        (939)
 Excess tax benefits from share    28        11         56         42
based payment arrangements
 Repurchases of common stock       (317)     (76)       (317)      (1,085)
 Cash dividends paid               (331)     (295)      (1,211)    (1,091)
Net cash used for financing           (938)     (919)      (1,206)    (1,114)
activities
Effect of foreign exchange rate       26        (21)       53         (60)
changes on cash and cash equivalents
Net (decrease)/increase in cash and   (126)     (187)      936        1,048
cash equivalents
Cash and cash equivalents at          4,760     3,885      3,698      2,650
beginning of period
Cash and cash equivalents at end of   $ 4,634   $ 3,698    $ 4,634    $ 3,698
period

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             $         $ 1,477     $            $ 
operating activities         1,349                    3,517         2,833
Expenditures for
property, plant and          (298)       (332)        (884)          (798)
equipment
Free cash flow               $         $ 1,145     $            $ 
                             1,051                    2,633         2,035
Cash pension                 260         272          1,039          1,745
contributions
Free cash flow, prior        $                      $            $ 
to cash pension              1,311       $ 1,417     3,672         3,780
contributions
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 theirmaturities, 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                $          $  1,429  $       $  5,357
                              1,496                   5,879
Stock compensation expense    (39)         (39)        (170)     (168)
(A)
Repositioning and other       (96)         (121)       (488)     (794)
(A, B)
Pension ongoing expense       (7)          (22)        (36)      (105)
(A)
Pension mark-to-market        (957)        (1,802)     (957)     (1,802)
adjustment (A)
Other postretirement          (20)         (23)        (72)      86
income/(expense) (A)
Operating Income (Loss)       $        $         $       $  2,574
                              377          (578)      4,156
Pension mark-to-market        $         $          $       $ (1,802)
adjustment (A)                (957)        (1,802)     (957)
Operating Income excluding    $                      $  
pension mark-to-market        1,334       $  1,224  5,113     $  4,376
adjustment
Segment Profit                $          $  1,429  $       $  5,357
                              1,496                   5,879
÷ Sales                       $          $  9,473  $        $ 36,529
                              9,581                   37,665
Segment Profit Margin %       15.6%        15.1%       15.6%     14.7%
Operating Income (Loss)       $        $         $       $  2,574
                              377          (578)       4,156
÷ Sales                       $          $  9,473  $        $ 36,529
                              9,581                   37,665
Operating Income (Loss)       3.9%         (6.1%)      11.0%     7.0%
Margin %
Operating Income excluding    $                      $  
pension mark-to-market        1,334       $  1,224  5,113     $  4,376
adjustment
÷ Sales                       $          $  9,473  $        $ 36,529
                              9,581                   37,665
Operating Income Margin
excluding pension             13.9%        12.9%       13.6%     12.0%
mark-to-market adjustment
%
(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

Website: http://www.honeywell.com