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Aerospace unit margins drive Honeywell profit beat
[London] Honeywell International Inc, a maker of aircraft cockpit parts and other electronic equipment, reported a better-than-expected third-quarter profit, helped partly by higher margins in its aerospace business.
The company's shares rose 3 per cent in premarket trading after it also raised the low end of its full-year forecast range for profit and revenue.
Margins in its aerospace business, its largest, rose to 20.3 percent in the third quarter ended Sept 30 from 18.8 per cent a year earlier.
Honeywell has been able to perform well this year despite a sluggish global economy, mainly due to its focus on controlling costs.
In July, the company merged its transportation division with its aerospace business to take advantage of the similarities in the units. "Looking ahead to 2015, we're once again planning for a slow growth macro environment, but expect to continue delivering strong earnings growth," Chief Executive Dave Cote said in a statement on Friday.
Honeywell said it now expected 2014 sales of US$40.3 billion-US$40.4 billion, compared with its previous forecast of US$40.2 billion-US$40.4 billion.
The company forecast earnings of at least US$5.50 per share for the year, up from its previous projection of at least US$5.45. It maintained the top end of the forecast range at US$5.55 per share.
Total revenue increased 4.8 per cent to US$10.11 billion.
Net income attributable to Honeywell rose to US$1.17 billion, or US$1.47 per share, from US$990 million, or US$1.24 per share, a year earlier.
Analysts on average expected earnings of US$1.41 per share on revenue of US$10.04 billion, according to Thomson Reuters I/B/E/S.
Honeywell's shares were up 3 per cent at US$89 before the bell. Up to Thursday's close, they had dropped 0.4 per cent in the past 12 months, compared with a 7 per cent rise in the S&P 500 index. REUTERS