United Tech 2nd Quarter Net Rises 0.8%; Cuts View
07/26/2012| 09:05am US/Eastern
By Victoria Stilwell
United Technologies Corp.'s (>> United Technologies Corporation) second-quarter profit edged up 0.8% on lower expenses, though the industrial conglomerate posted a decline in revenue and weaker results at its Otis unit.
United Technologies said it expects to receive full regulatory approval on Thursday for its proposed acquisition of aircraft-components maker Goodrich Corp. (>> Goodrich Corporation) and anticipates closing the acquisition by the end of the week.
The company lowered its full-year guidance in light of the slowing global economy and late-July close for Goodrich, now expecting sales of $58 billion to $59 billion and per-share earnings of $5.25 to $5.35. The company previously predicted sales of $61 billion to $62 billion on earnings of $5.30 to $5.50 a share. The company also said it will increase its investment on restructuring to $500 million from $450 million.
The maker of Otis elevators, Pratt & Whitney aircraft engines and Carrier air-conditioning systems has recently made deals that increase its exposure to the commercial aviation business. The company has sold a handful of its other businesses to fund its $16.5 billion deal to buy Goodrich.
United Technologies agreed Wednesday to sell three units of its Hamilton Sundstrand subsidiary to a private-equity group for about $3.5 billion to help fund its Goodrich purchase. The company earlier this month also said it sold its Rocketdyne business--part of Pratt & Whitney--to GenCorp Inc. (>> Gencorp Inc) for about $550 million.
For the second quarter, United Technologies reported a profit of $1.33 billion, or $1.47 a share, fractionally up from a year-earlier profit of $1.32 billion, or $1.44 a share. The company's per-share earnings from continuing operations rose to $1.62 from $1.41 a year earlier.
The latest period included 10 cents a share of favorable one-time items, partially offset by 6 cents in restructuring costs. The year-earlier period included a currency translation gain of 6 cents.
Revenue declined 4.6% to $13.81 billion.
Analysts surveyed by Thomson Reuters recently expected a per-share profit of $1.41 on revenue of $14.45 billion.
Revenue from Pratt & Whitney rose 5.2% as profit edged up 0.7%, while revenue at the Otis unit decreased 5.2% and profit fell 12%.
Total costs and expenses dropped 4.5% to $12 billion.
Shares slipped 0.5% to $73 in recent premarket trade.
Write to Victoria Stilwell at Victoria.Stilwell@dowjones.com
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