United Technologies Raises Targets, Waits on Rockwell Merger

By Thomas Gryta 

United Technologies Corp. sought to reassure investors that its core businesses are performing well even as the company's $23 billion takeover of Rockwell Collins Inc. hangs in regulatory limbo.

The conglomerate, which makes Pratt & Whitney jet engines and Otis elevators, said Tuesday its third-quarter profit dropped 7% as higher costs offset a 10% jump in revenue. Excluding acquisitions, the company said organic sales rose 8% from a year ago.

United Technologies raised its financial targets for the rest of its fiscal year but didn't comment in its release on the status of the pending Rockwell Collins deal, which was supposed to close by the end of September.

The year-old deal received U.S. regulatory approval earlier this month but appears to still be under review by Chinese authorities. The delays have stoked speculation that the transaction's approval could become entangled in trade tension between the U.S. and China.

Executives are scheduled to hold a conference call later Tuesday morning.

United Technologies owns one of the world's biggest jet-engine makers, Pratt & Whitney, along with Otis elevators and Carrier air conditioners. Executives have said they are exploring whether to breakup the company after the Rockwell deal closes.

United Technologies boosted its 2018 adjusted earnings outlook to a range of $7.20 to $7.30 a share, up from a previous view of $7.10 to $7.25 a share. It also raised the low end of its 2018 sales projection by $500 million and now expects $64 billion to $64.5 billion. Its free cash flow goal of $4.5 billion to $5 billion is unchanged.

Analysts expected 2018 earnings of $7.23 on revenue of $64.6 billion.

Third-quarter net income slipped to $1.24 billion, down from $1.33 billion a year earlier. The results were weighed down by restructuring charges. Total revenue was $16.51 billion, up from $15.06 billion a year ago. Both profit and sales exceeded Wall Street's expectations.

Write to Thomas Gryta at [e-mail]

(END) Dow Jones Newswires

October 23, 2018 07:59 ET (11:59 GMT)

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