Honeywell Sees 9.8% Jump in First-Quarter 2015 Profits, Lowers Sales Outlook

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Researched by Industrial Info Resources (Sugar Land, Texas)--Honeywell International Incorporated (NYSE:HON) (Morristown, New Jersey) reported $1.12 billion in first-quarter net income, up 9.8% from $1.02 billion in the same quarter of 2014. The diversified manufacturer and chemicals processing firm said its earnings were at the high end of its guidance range. However, net sales for the quarter fell 4.8% to $9.21 billion, from nearly $9.68 billion in the same quarter a year earlier.

Industrial Info is tracking 44 active Honeywell-related chemical processing projects with a combined worth of more than $976 million. This includes 30 projects, valued at $346 million, which are under construction. Three projects, valued at $435 million, are in the engineering phase; and 11 projects, valued at $186 million, are in the planning phases, where plenty of factors could alter their timing or outcome.

Honeywell reduced its sales expectations for the year by 2% to 3%, to a range of $39 billion to $39.6 billion. But it raised the low end of its earnings-per-share guidance range for the year to $6.15 from an earlier estimate of $5.95.

The Performance Materials and Technologies segment, which includes chemical processing, reported total sales dropped 5% to $2.34 billion during the quarter ended March 31. Honeywell cited lower raw materials pricing, which were then reflected in prices for resins and chemicals. However, the segment did benefit from the strength of the company's UOP gas-processing business and higher fluorine and specialty product sales. Segment profits were up 6%.

Looking forward, Chief Financial Officer Tom Szlozek said he expects to see continued headwinds from the Chemical Processing Industry. The company now expects to see Performance Materials and Technologies segment sales of $9.7 billion to $9.9 billion for all of 2015, down from earlier expectations of $10.3 billion to $10.5 billion.

Sales by Honeywell's Aerospace segment fell 6% to $3.6 billion, as a result of the divestiture of its friction materials business, and the unfavorable impact of foreign currency exchanges, the company reported. Segment profit rose 7%.

The Automation and Control Solutions segment reported first-quarter sales fell 3% to $3.26 billion from a year earlier, due to the impact of foreign exchange rates. Segment profit rose 10%.

Louisiana has the lion's share of the projects being tracked by Industrial Info. The Pelican State has 12 projects valued at $759 million. Honeywell was performing site preparation for the HFO-1234yf refrigerant units addition at its Geismar facility. HFO-1234yf is a refrigerant used in automobiles. Construction kickoff is slated for this month, with completion in fourth-quarter 2017.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.