United Technologies Corp
), a leading provider of high-technology products, reported
fourth quarter 2012 earnings of $1.04 per share versus $1.42 in
the year-ago quarter. The reported earnings beat the Zacks
Consensus Estimate of $1.02. For 2012, EPS of $5.35 was
essentially flat compared to the prior year, but ahead of
the Zacks Consensus Estimate of $5.32.
Total revenue for the fourth quarter grew 14% year over year to
$16.4 billion, but marginally missed the Zacks Consensus Estimate
of $16.5 billion. Organic sales growth was flat in the quarter
and foreign currency translation had a negative impact of 1
However, acquisitions contributed 15 points growth to the top
line. For 2012, total revenue stood at $57.7 billion, up 4% year
over year, including the effects of net acquisitions (6 points)
and negative foreign currency translation (2 points).
New equipment orders at Otis were up 12% over the year-earlier
quarter. North American Residential HVAC new equipment orders at
the company's UTC Climate, Controls & Security was up 20%.
Commercial spares orders at Pratt & Whitney's large engine
business dipped 8%, while that of UTC Aerospace Systems declined
4%. However, large commercial engine spares orders were up
46 % at Pratt & Whitney.
Otis reported revenues of $3,205 million in fourth quarter
down 0.18% year over year. At the same time, revenue at UTC
Climate Controls & Security declined 6% year over year to
$4,147 million. Pratt & Whitney revenue increased 10.5% year
over year to $3891 million in fourth quarter while UTC
Aerospace systems sales went up 60% year over year to $3174
million. Additionally, Sikorsky sales were up 3% year over year
to $2176 million in fourth quarter.
Balance Sheet and Cash Flow
The company continues to maintain a strong cash flow
position. As of Dec, 30, 2012, cash and cash equivalents
were $4.8 billion with long-term debt of $21.6 billion. The
company had a debt to capital ratio of 46.0%. Cash flow from
operations was $6.6 billion, while capital expenditures were $1.4
billion for 2012.
In order to come up with innovative products amid a
challenging macroeconomic environment, United Technologies
invested $2.4 billion in developing game-changing technologies
and nearly $600 million on restructuring initiatives.
Cocurrent with the strong quarterly and full-year results and
based on its improved order trends, sales in 2013 are expected to
be in the range of $64 billion to $65 billion, while earnings are
expected to be in the range of $5.85 to $6.15 per share.
United Technologies repositioned its portfolio in fiscal 2012
with the completion of the Goodrich acquisition and IAE
transactions and the divestiture of several non-strategic assets
with its main focus on the core markets.
However, the company needs to be wary of its competitors, which
include formidable names such as
Federal Signal Corp
United Technologies currently has a Zacks Rank #3 (Hold). One of
Tyco International Ltd
) carries a Zacks Rank #1 (Strong Buy).
ITT CORP (ITT): Free Stock Analysis Report
UTD TECHS CORP (UTX): Free Stock Analysis
To read this article on Zacks.com click here.