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HONEYWELL EARNS $331.1 MILLION IN 1991 Performance Steady in Recessionary Economy

 HONEYWELL EARNS $331.1 MILLION IN 1991
 Performance Steady in Recessionary Economy
 Company Posts EPS of $4.70 for Year
 MINNEAPOLIS, Feb. 18 /PRNewswire/ -- Honeywell Inc. (NYSE: HON) today reported 1991 net income of $331.1 million, or $4.70 per share. This was achieved despite a higher effective tax rate of 35 percent in 1991, compared with a 28 percent effective tax rate in 1990.
 In 1990, the company's net income was $381.9 million, or $5.03 a share. Aside from the lower effective tax rate, 1990 results included a gain of $14.3 million, or 19 cents per share, from the sale of assets, and income from discontinued operations of $10.1 million, or 13 cents per share, from the company's defense and marine systems business, which was spun off in 1990. Income in 1990, excluding the gain from the sale of assets and income from discontinued operations, was $357.5 million, or $4.71 per share.
 Sales in 1991 were $6.19 billion. 1990 sales of $6.31 billion included $282 million from units divested in 1990. Excluding sales from divested units, 1991 sales increased 2.8 percent from the prior year.
 Operating profit was $676.1 million in 1991, up from $675.7 million a year earlier. Operating profit in 1990 included $15 million from divested units.
 "Honeywell produced stable, solid results amid a worldwide recession in 1991. This represents a dramatic improvement from the company's performance in past economic downturns, and reflects the success of our strategy to focus on our core control businesses," said James J. Renier, Honeywell chairman and chief executive officer. "We have demonstrated the strength and commitment to maintain progress through difficult economic times. At the same time, we are poised to take advantage of an overall economic rebound, when it occurs."
 Renier noted that the company maintained a 30 percent debt-to-total capitalization ratio, and that Honeywell's debt rating was upgraded during the year by Standard & Poors, Moody's and Duff & Phelps.
 1991 Business Unit Results
 Home and Building Control. Sales for Home and Building Control in 1991 were $2.25 billion, up from $2.2 billion in 1990. Operating profit for the business was $229.1 million, compared with $237 million in 1990.
 "Our unrivaled installed product base in existing buildings and homes provided a key source of stability in 1991," Renier said. "We also effectively expanded our position in vertical markets such as hospitals, airports and schools, and we captured market share worldwide."
 Industrial. Sales for Industrial in 1991 were $1.63 billion, compared with $1.65 billion in 1990. Excluding sales from the Test Instruments Division, spun off in Sept. 1990, Industrial sales for 1990 were $1.59 billion. On a comparable basis, 1991 sales increased 2.5 percent from 1990. Industrial operating profit in 1991 was $224 million, up 2.1 percent from $219.5 million in 1990. Profits increased in U.S. and international markets.
 "Our process control business continued to achieve outstanding results," Renier said. "With our superior technology, we have made inroads into many markets. In particular, we are benefiting from industry's investment in equipment to comply with increasingly stringent U.S. Clean Air Act requirements.
 "In the components business, soft demand in key end markets continued to place downward pressure on margins, but our performance outpaced the overall market."
 Space and Aviation. 1991 sales in Space and Aviation increased 2.9 percent to $2.13 billion from $2.07 billion in 1990. Operating profit for the business increased 12.8 percent to $226.1 million from $200.4 million in the prior year. All three units in this business improved operating profit levels.
 "Commercial flight systems achieved another excellent year," Renier said. "The long-term outlook for this business remains very good. However, the economic plight in the airline industry has caused airlines to delay deliveries of new aircraft, and we expect production of narrow- body aircraft to drop significantly in 1992.
 "The military avionics and space systems segments turned in outstanding operating profits and improved operating margins," Renier said.
 Other sales. Sales from other operations in 1991 were $184.7 million, with an operating loss of $3.1 million. 1990 sales were $387.6 million, including $203.1 million from Honeywell Federal Systems, which was sold to Bull H.N. Information Systems in October 1990.
 Fourth-Quarter Summary
 In the fourth quarter, Honeywell's net income was $102.6 million, or $1.46 per share, compared with $109.2 million, or $1.49 per share, a year earlier.
 Operating profit was $199.4 million, compared with $203.9 million in the year-earlier quarter. Quarterly operating profit improved in the Home and Building Control and Industrial businesses, and remained steady in Space and Aviation.
 Worldwide sales in the quarter increased 2.3 percent to $1.71 billion from $1.67 billion. Each of the three major businesses increased sales from year-earlier levels.
 During the quarter, Honeywell increased its annual dividend 10 percent, to $1.65 per share. The company also began a $600 million, five-year share repurchase program.
 Home and Building Control earned a fourth-quarter operating profit of $88.5 million, up 3.5 percent from $85.5 million a year earlier. Sales for the business were $670.7 million, up 2.6 percent from $653.7 million in the fourth quarter of 1990. During the quarter, orders for the business registered a double-digit increase.
 Operating profit for the company's Industrial business was $66.2 million, up from $65.6 million in the fourth quarter of 1990. Industrial sales for the quarter were $458.9 million, up 3.7 percent from $442.5 million a year earlier. Industrial orders increased modestly.
 Space and Aviation earned a fourth-quarter operating profit of $48.7 million, compared with $48.9 million in the 1990 fourth quarter. Sales in the quarter were $520 million, up from $514.7 million a year earlier. Orders in the quarter declined from strong year-earlier levels.
 Honeywell is a global controls company that provides products, systems and services for homes and buildings, industry, and aviation and space. The company employs 58,000 people in 90 countries on six continents.
 HONEYWELL INC. AND SUBSIDIARIES
 INCOME STATEMENT
 (Dollars in Millions Except Per Share Amounts)
 Fourth Quarter Percent
 1991 1990 Change
 Sales $1,710.7 $1,672.8 2.3
 Costs and expenses
 Cost of sales 1,149.7 1,124.0
 Research and development 81.8 74.0
 Selling, general and administrative 319.4 326.3
 Interest - net 14.7 11.8
 Equity income (7.3) (4.6)
 -- 1,558.3 1,531.5
 Income from continuing
 operations before income taxes 152.4 141.3
 Provision for income taxes 49.8 32.1
 Income from continuing operations 102.6 109.2 (6.0)


n?come from discontinued
 operations net of income taxes
 Net income $102.6 $109.2 (6.0)
 EARNINGS PER COMMON SHARE
 Continuing operations $1.46 $1.49 (2.0)
 Discontinued operations
 Net income $1.46 $1.49 (2.0)
 HONEYWELL INC. AND SUBSIDIARIES
 INCOME STATEMENT
 (Dollars in Millions Except Per Share Amounts)
 12 MONTHS
 1991 1990
 Sales $6,192.9 $6,309.1 (1.8)
 Costs and expenses
 Cost of sales 4,185.1 4,308.7
 Research and development 300.7 279.6
 Selling, general and administrative 1,150.9 1,170.0
 Interest - net 61.4 67.6
 Gain on sale of assets (21.7)
 Equity income (14.6) (11.5)
 -- 5,683.5 5,792.7
 Income from continuing operations
 before income taxes 509.4 516.4
 Provision for income taxes 178.3 144.6
 Income from continuing operations 331.1 371.8 (10.9)
 Income from discontinued
 operations net of income taxes 10.1
 Net income $331.1 $381.9 (13.3)
 EARNINGS PER COMMON SHARE
 Continuing operations $4.70 $4.90 (4.1)
 Discontinued operations 0.13
 Net income $4.70 $5.03 (6.6)
 Average number of common shares
 outstanding 70,434,111 75,880,047
 HONEYWELL INC. AND SUBSIDIARIES
 SALES AND OPERATING PROFIT BY SEGMENT
 |Dollars in Millions~
 FOURTH QUARTER
 1991 1990
 Sales
 Home and Building Control $670.7 $653.7
 Industrial 458.9 442.5
 Space and Aviation 520.0 514.7
 Other 61.1 61.9
 -- $1,710.7 $1,672.8
 Operating profit
 Home and Building Control $88.5 $85.5
 Industrial 66.2 65.6
 Space and Aviation 48.7 48.9
 Other (4.0) 3.9
 Total operating profit 199.4 203.9
 Interest expense (22.7) (20.1)
 Equity income 7.3 4.6
 General corporate expense (31.6) (47.1)
 Income before income taxes $152.4 $141.3
 12 MONTHS
 1991 1990
 Sales
 Home and Building Control $2,249.1 $2,196.7
 Industrial 1,626.8 1,653.5
 Space and Aviation 2,132.3 2,071.3
 Other 184.7 387.6
 -- $6,192.9 $6,309.1
 Operating profit
 Home and Building Control $229.1 $237.0
 Industrial 224.0 219.5
 Space and Aviation 226.1 200.4
 Other (3.1) 18.8
 Total operating profit 676.1 675.7
 Interest expense (89.4) (106.0)
 Gain on sale of assets 21.7
 Equity income 14.6 11.5
 General corporate expense (91.9) (86.5)
 Income before income taxes $509.4 $516.4
 -0- 2/18/92
 /CONTACT: Kevin Whalen of Honeywell, 612-870-2524 or 612-431-5662/
 (HON) CO: Honeywell Inc. ST: Minnesota IN: SU: ERN


AL -- MN011 -- 9966 02/18/92 13:03 EST
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