United Technologies Raises Outlook -- Update

By Dave Sebastian 

United Technologies Corp. raised its outlook for the year as earnings and revenue in the latest quarter beat expectations.

The Farmington, Conn., aerospace company reported second-quarter net income of $1.9 billion, or $2.20 a share, down from $2 billion, or $2.56 a share a year earlier.

Analysts polled by FactSet were expecting $1.90 a share in profit. But adjusted earnings of $2.20 a share were above the $2.05 a share projected by analysts.

Revenue rose to $19.63 billion in the quarter, up from $16.7 billion in the comparable quarter last year, surpassing analysts' average estimate of $19.55 billion.

Otis, the company's elevator business, generated slightly more revenue compared with a year earlier, while sales at Carrier, UTC's buildings-systems business, dropped 1.45% from last year.

Sales at jet-engine manufacturer Pratt & Whitney and Collins Aerospace both climbed 8.74% and 66%, respectively.

UTC acquired aerospace company Rockwell Collins for $23 billion late last year to form Collins Aerospace.

Costs and expenses rose to $17.26 billion from $14.77 billion the same period last year.

The company raised its adjusted earnings projections for 2019 to $7.90 to $8.05 a share from its previous guidance of $7.80 to $8 a share. Sales expectations remain the same at $75.5 billion to $77 billion, the company said.

UTC in June struck an all-stock deal to merge with defense contractor Raytheon Co. after UTC executives chose to exit the escalator and air-conditioner businesses.

The combined company, valued at more than $100 billion after planned spinoffs, would be the world's second-largest aerospace-and-defense company by sales behind Boeing Co., with annual revenue of about $74 billion this year. It will make everything from engines and seats for jetliners and F-35 jet fighters, to Patriot missile launchers and space suits for astronauts.

The tie-up would complete a radical transformation at UTC, a once sprawling conglomerate that already plans to spin off its Otis and Carrier units into separate companies.

Raytheon would be combining with UTC's remaining aerospace business, and the companies expect the transaction to close in the first half of next year, after UTC completes the spinoffs.

Shares of UTC gained about 2.3% premarket.

Write to Dave Sebastian at [e-mail]

(END) Dow Jones Newswires

July 23, 2019 09:03 ET (13:03 GMT)

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