Honeywell International Inc. posted a first-quarter profit that beat analysts’ estimates as turbocharger sales benefited from a European auto rebound and U.S. growth spurred demand at the control-products unit. The company increased the low end of its 2014 earnings forecast.
Net income rose 5.6 percent to $1.02 billion, or $1.28 per share, from $966 million, or $1.21 per share, a year earlier, the Morris Township, New Jersey-based company said in a statement. Analysts had estimated earnings per share of $1.26 excluding some costs and gains.
The U.S. and European economies both are projected to grow more this year than last, boosting earnings at multinational industrial companies even as growth in emerging markets tapers.
“We remain cautiously optimistic on the macro environment, even with some nice momentum exiting the quarter,” Chief Executive Officer Dave Cote said in the statement.
Auto sales in Europe, where Honeywell sells the most turbochargers, rose 10 percent in March and have risen in the last seven months. U.S. factory production has also increased, giving a lift to Honeywell’s Automation and Control Solutions business which sells products from safety equipment to hand-held computers that track inventories.
In January Honeywell reported it had sold shares in B/E Aerospace Inc. that added 10 cents to earnings per share. It used the funds for efficiency projects and environmental remediation.
Sales rose 3.8 percent to $9.7 billion, even as aerospace revenue dropped 1.8 percent. Analysts had estimated sales of $9.74 billion. Honeywell said it expects earnings per share of $5.40 to $5.55 this year, boosting the low end of its previous range of $5.35 to $5.55.
The company forecast second quarter earnings per share of $1.32 to $1.36, which is below analysts’ estimates of $1.37 per share. Sales are expected to increase 3 percent to 5 percent, Honeywell said.
Transportation Systems led the first-quarter sales gain with an 8.6 percent increase to $993 million. Automation and Control Solutions saw sales rise 7.6 percent to $4.07 billion. Sales rose 2.2 percent at Performance Materials and Technologies and dropped 1.8 percent at Aerospace to $2.86 billion.
Cote created two new vice president positions earlier this month, in acquisitions and software, as part of the biggest management changes since he took over 12 years ago.
The moves are designed to help Honeywell meet the five-year goals Cote set in March to boost sales as high as $59 billion, by spending $10 billion or more on acquisitions by 2018.