Honeywell International Inc HONOR reported first-quarter fiscal 2024 sales of $9.105 billion.
This is a 3% year-over-year increase on a reported basis and a 3% increase on an organic basis, beating the consensus of $9.03 billion.
The increase in sales was attributed to solid growth in aerospace technologies, energy and sustainable solutions.
Adjusted EPS was $2.25 (+9% Y/Y), beating consensus of $2.17.
Sales by segments:
- Aerospace Technologies$3.67 billion (+18% y/y)
- Industrial automation $2.48 billion (-12% y/y)
- Building automation $1.43 billion (-4% y/y)
- And solutions for energy and sustainability 1.53 billion dollars (+4% y/y).
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Operating margin grew 130 bps to 20.4%. The segment’s margin increased 20 basis points to 22.2%, driven by expansion in aerospace technologies.
Net cash provided by operating activities for the quarter was $448 million compared to cash used of millions of dollars a year ago. Free cash flow was $215 million on year-over-year cash outflow of $977 million. (+22% y/y).
As long-cycle customer demand remained strong, Honeywell’s robust order book increased 6% year over year. The value increased sequentially, closing the quarter at a record high of $32 billion, Honeywell CEO Vimal Kapoor She said.
“We have also experienced pockets of recovery in the short cycle and expect broader participation as the year unfolds and channels normalize further,” Kapur said.
Honeywell held cash and cash equivalents of approximately $11.756 billion as of March 31, 2023. The company has deployed $1.6 billion in capital to share buybacks, dividends and capital expenditures.
During the quarter, Honeywell announced its intent to acquire Civitanavi Systems. The deal would further strengthen its aerospace navigation offering and expand its presence in Europe.
Second quarter outlook: Honeywell expects revenue of $9.2 billion – $9.5 billion versus consensus of $9.38 billion, adjusted earnings per share of $2.25 – $2.35 versus consensus of $2.35 dollars and a segment margin of 22% – 22.4%.
Outlook for 2024: Honeywell expects revenue of $38.1 billion to $38.9 billion versus consensus of $38.84 billion, with organic sales growth of 4% to 6%.
Honeywell expects a segment margin of 23% to 23.3%, with segment margin expansion of 30 to 60 basis points.
Honeywell expects adjusted earnings per share of $9.80-10.10 versus consensus of $9.95; expects operating cash flow of $6.7 billion-$7.1 billion and free cash flow of $5.6 billion-$6 billion.
Price Action: At last check, Honeywell shares were trading 1.13% higher at $197 pre-market.
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