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HONEYWELL REPORTS 1992 EARNINGS OF $327 MILLION, HIGHER EPS ON COMPARABLE BASIS

 MINNEAPOLIS, Feb. 16 /PRNewswire/ -- Honeywell Inc. (NYSE: HON) today said it earned $327 million, or $2.36 per share, in 1992, before reflecting special items and the adoption of three new accounting standards. That compares with net income of $331.1 million, or $2.35 per share, in 1991.
 In 1992, the company recognized the following special items: an after-tax gain of $171.4 million, or $1.24 per share, from the settlement of patent disputes with a number of camera companies; a one- time, after-tax charge of $85.1 million, or 62 cents per share, for costs to streamline the company's three business segments; and an after- tax charge of $8.6 million, or 6 cents per share, for early redemption of $180.8 million of long-term debt. Also included were non-cash, after-tax charges of $157.9 million, or $1.14 per share, to adopt three new Financial Accounting Standards. In addition, earnings per share have been adjusted to reflect a two-for-one stock split completed in December.
 Including those items, Honeywell reported 1992 net income of $246.8 million, or $1.78 per share. Companywide sales were $6.22 billion, compared with $6.19 billion in 1991.
 "After removing the impact of special items, Honeywell's earnings per share, on a comparable basis, improved from 1991 despite a languid economy worldwide," said James J. Renier, Honeywell chairman and CEO. "As evidence of our confidence about our long-term prospects, we increased our dividend and stepped up our five-year, $600 million share repurchase program during the fourth quarter. From a business standpoint, we had a solid year, and we introduced several products, including the Excel 5000 building automation system and TotalPlant Open Solutions for industrial processes.
 "In addition," Renier said, "proceeds from autofocus patent settlements gave us the financial flexibility to streamline our organization in anticipation of changing market requirements and emerging growth opportunities. This will help ensure our ability to generate additional shareholder value through the decade."
 Also in 1992, the company repurchased $189.3 million in shares, including $50.1 million in the fourth quarter, as part of a five-year, $600 million share buyback program.
 A summary of items affecting 1992 earnings follows.
 Autofocus settlements. Through the year, Honeywell reached settlements with 14 camera companies using autofocus camera technology patented by Honeywell. The settlements resulted in an after-tax gain of $171.4 million, or $1.24 per share, of which $7.4 million, or 6 cents per share, came in the fourth quarter.
 Streamlining provision. In the fourth quarter, Honeywell recorded a special after-tax charge of $85.1 million, or 62 cents per share. Cash outflow associated with the charge will occur over the next two years.
 This charge includes costs for ongoing efforts to appropriately size the Space and Aviation segment to changing market conditions. This business is affected by continued declines in aircraft deliveries and reductions in defense spending.
 In Home and Building Control and Industrial, the company is investing to reposition the businesses and capitalize on emerging market opportunities. The charge includes costs for facilities consolidation and organizational changes.
 Redemption of long-term debt. During the year, the company made early repayment of $180.8 million in high-coupon long-term debt. Early redemption resulted in an extraordinary loss of $8.6 million, or 6 cents per share, including $3.1 million, or 2 cents per share, in the fourth quarter.
 Financial accounting standards. Honeywell adopted, retroactive to Jan. 1, 1992, three new standards required by the Financial Accounting Standards Board. Cash flow is not affected by the accounting changes.
 FAS 106 requires companies to recognize employee post-retirement benefits other than pensions over the time employees earn the benefits. Previously, the company accounted for the cost of those benefits when they were actually provided. Adoption of FAS 106 resulted in a one- time, after-tax charge of $151.3 million, or $1.09 per share. The ongoing impact for 1992 was an after-tax charge of $10.9 million, or 8 cents per share.
 Adoption of FAS 109, accounting for income taxes, resulted in a cumulative gain of $31.4 million, or 23 cents per share. FAS 109 had no ongoing impact in 1992.
 Honeywell also adopted FAS 112, which addresses when post-employment benefits, primarily medical benefits for disabled former employees, are recognized. The one-time, after-tax charge of adopting FAS 112 was $24.6 million, or 18 cents per share, and the ongoing impact for 1992 was an after-tax charge of $2.5 million, or 2 cents per share.
 1992 Business Unit Results Home and Building Control.
 Sales for the year were a record $2.39 billion, up 6.4 percent from $2.25 billion in 1991. Excluding special items, operating profit for the business increased 5.4 percent to $241.4 million, from $229.1 million a year earlier. The improvement stemmed from the strength of new product introductions and success in key vertical markets.
 "We had a successful year with our systems upgrade programs for schools, hospitals and airports, as well as with our new line of next- generation automation products for homes and buildings," Renier said.
 Industrial. Sales were a record $1.74 billion, up 7.2 percent from $1.63 billion in 1991. Excluding special items, operating profit was $200.4 million, compared with $224 million in 1991. The decline in operating profit was the result of soft margins from a changing product mix during the first nine months in industrial systems. In components, margins in the United States rebounded with an improvement in the durable goods market and gains in market share.
 "We increased our market share in industrial process controls in such areas as power generation, petroleum refining and fine chemicals," Renier said. "We also received broad acceptance of new products, services and software."
 Space and Aviation. Sales were $1.93 billion, down 9.3 percent from $2.13 billion in 1991. Excluding special items, operating profit declined 3 percent to $219.3 million from $226.1 million a year earlier. Sales of commercial avionics were down significantly during the year as financial troubles caused airlines to further delay deliveries of new aircraft. However, profitability in the business was relatively flat as the company benefited from cost-containment efforts.
 "We are taking appropriate steps to properly size the Space and Aviation business, which is affected by difficulties in the airline industry and by flat NASA and declining defense budgets," Renier said. "The long-term fundamentals in the commercial avionics division remain strong, and we continue to invest in development of next-generation avionics for the Boeing 777, Cessna Citation X and other aircraft."
 Other Sales. Sales from other operations were $152 million in 1992, with an operating loss of $6.3 million, excluding special charges. Other sales in 1991 were $184.7 million, with a $3.1 million operating loss.
 Fourth-Quarter Summary
 In the fourth quarter, Honeywell's earnings, excluding special items, increased 10 percent to $113.1 million, or 82 cents per share, from $102.6 million, or 73 cents per share, a year earlier. Including the special items, Honeywell earned net income of $29 million, or 21 cents per share.
 Operating profit in the quarter, excluding special items, was $213.1 million, a 6.9 percent increase from the 1991 fourth quarter. Sales in the period were $1.71 billion, virtually unchanged from the year-earlier period.
 Home and Building Control's operating profit was $88.8 million, excluding special items. That compared with $88.5 million in the year- earlier quarter. Sales for the business were $687.1 million, up 2.4 percent from a year earlier. Orders declined about 2 percent from strong year-earlier levels.
 In the Industrial segment, operating margins improved in the quarter. Operating profit, excluding special items, increased 16 percent to $76.8 million, from $66.2 million a year earlier, primarily resulting from strong component sales in the U.S. and improved performance on systems contracts. Sales increased 6 percent to $486.5 million from $458.9 million a year earlier. Orders, led by strong international process control markets, were up 10 percent from year-earlier levels.
 Space and Aviation's operating profit was $43.7 million, excluding special items, compared with $48.7 million in the same quarter of 1991. Sales were $482.1 million, down from $520 million a year earlier. Orders declined about 5 percent.
 Other operations generated a $3.8 million operating profit, excluding special items, on sales of $49.5 million. A year earlier, other operations had a $4 million operating loss on sales of $61.1 million.
 During the quarter, Honeywell increased its annual dividend 8 percent to 89 cents per share and said it will accelerate its five- year, $600 million share buyback program.
 Honeywell is a global controls company providing products, systems and services that increase comfort, environmental protection, energy conservation, productivity and safety in homes and buildings, industry, and aviation and space. The company employs 55,000 people in 90 countries on six continents.
 HONEYWELL INC. AND SUBSIDIARIES
 INCOME STATEMENT
 (Dollars in Millions Except Per Share Amounts)
 FOURTH QUARTER
 1992 1991 Pct.
 SALES................................... $1,705.2 $1,710.7 (0.3)
 COSTS AND EXPENSES
 Cost of sales........................... 1,128.1 1,149.7
 Research and development................ 90.1 81.8
 Selling, general and administrative..... 313.5 319.4
 Autofocus litigation
 settlements and special charges......... 113.9 --
 Interest - net.......................... 13.9 14.7
 Equity income........................... (9.1) (7.3)
 -- 1,650.4 1,558.3
 INCOME BEFORE INCOME TAXES.............. 54.8 152.4
 PROVISION FOR INCOME TAXES.............. 22.7 49.8
 INCOME BEFORE EXTRAORDINARY ITEM AND
 CUMULATIVE EFFECT OF ACCOUNTING CHANGES 32.1 102.6 (68.7)
 EXTRAORDINARY ITEM - LOSS
 ON EARLY REDEMPTION OF DEBT............. (3.1) --
 CUMULATIVE EFFECT OF ACCOUNTING CHANGES -- --
 NET INCOME.............................. $29.0 $102.6 (71.7)
 EARNINGS PER COMMON SHARE
 Income Before Extraordinary Item and
 Cumulative Effect of Accounting Changes 0.23 0.73 (68.5)
 Extraordinary Item - Loss
 on Early Redemption of Debt............. (0.02) --
 Cumulative Effect of Accounting Changes
 Net Income.............................. $0.21 $0.73 (71.2)
 HONEYWELL INC. AND SUBSIDIARIES
 INCOME STATEMENT
 (Dollars in Millions Except Per Share Amounts)
 TWELVE MONTHS
 1992 1991 Pct.
 SALES.................................. $6,222.6 $6,192.9 0.5
 COSTS AND EXPENSES
 Cost of sales........................... 4,195.3 4,185.1
 Research and development................ 312.6 300.7
 Selling, general and administrative..... 1,196.8 1,150.9
 Autofocus litigation settlements
 and special charges......... (159.5) --
 Interest - net.......................... 58.5 61.4
 Equity income........................... (15.8) (14.6)
 -- 5,587.9 5,683.5
 INCOME BEFORE INCOME TAXES.............. 634.7 509.4
 PROVISION FOR INCOME TAXES.............. 234.8 178.3
 INCOME BEFORE EXTRAORDINARY ITEM AND
 CUMULATIVE EFFECT OF ACCOUNTING CHANGES 399.9 331.1 20.8
 EXTRAORDINARY ITEM - LOSS
 ON EARLY REDEMPTION OF DEBT............. (8.6) --
 CUMULATIVE EFFECT OF ACCOUNTING CHANGES. (144.5) --
 NET INCOME ............................. $246.8 $331.1 (25.5)
 EARNINGS PER COMMON SHARE
 Income Before Extraordinary Item and
 Cumulative Effect of Accounting Changes $2.88 $2.35 22.6
 Extraordinary Item - Loss
 on Early Redemption of Debt............. (0.06) --
 Cumulative Effect of Accounting Changes. (1.04) --
 Net Income.............................. $1.78 $2.35 (24.3)
 AVERAGE NUMBER OF
 COMMON SHARES OUTSTANDING........... 138,525,414 140,868,222
 HONEYWELL INC. AND SUBSIDIARIES
 SALES AND OPERATING
 PROFIT BY SEGMENT
 (Dollars in Millions)
 FOURTH QUARTER
 AS REPORTED ADJUSTED(A)
 1992 1991 1992
 SALES
 Home and Building Control $687.1 $670.7
 Industrial 486.5 458.9
 Space and Aviation 482.1 520.0
 Other 49.5 61.1
 -- $1,705.2 $1,710.7
 OPERATING PROFIT
 Home and Building Control $44.8 $88.5 $88.8
 Industrial 37.0 66.2 76.8
 Space and Aviation 6.6 48.7 43.7
 Other 1.0 (4.0) 3.8
 Total operating profit 89.4 199.4 213.1
 Interest expense (21.4) (22.7) (21.4)
 Equity income 9.1 7.3 9.1
 General corporate income (expense) (22.3) (31.6) (27.0)
 Income before income taxes 54.8 152.4 173.8
 Provision for income taxes 22.7 49.8 60.7
 Income before extraordinary
 item and cumulative effect
 of accounting changes $32.1 $102.6 $113.1
 Earnings per common share $0.23 $0.73 $0.82
 (A) Excludes autofocus settlement, streamlining provision and impact of new accounting standards.
 - Autofocus settlement of $14.5 is included in general corporate expense
 - Streamlining provision of $128.4 is included as follows: Home and Building Control $42.7, Industrial $38.6, Space and Aviation $34.9, Other $2.6 and general corporate expense $9.6
 - Impact of adopting SFAS 106 and SFAS 112 of $5.1 is included as follows: Home and Building Control $1.3, Industrial $1.2, Space and Aviation $2.2, Other $0.2 and general corporate expense $0.2
 HONEYWELL INC. AND SUBSIDIARIES
 SALES AND OPERATING PROFIT BY SEGMENT
 (Dollars in Millions)
 TWELVE MONTHS
 AS REPORTED ADJUSTED(A)
 1992 1991 1992
 SALES
 Home and Building Control $2,393.6 $2,249.1
 Industrial 1,743.9 1,626.8
 Space and aviation 1,933.1 2,132.3
 Other 152.0 184.7
 $6,222.6 $6,192.9
 OPERATING PROFIT
 Home and Building Control $193.4 $229.1 $241.4
 Industrial 156.9 224.0 200.4
 Space and Aviation 175.8 226.1 219.3
 Other (9.5) (3.1) (6.3)
 Total operating profit 516.6 676.1 654.8
 Interest expense (89.9) (89.4) (89.9)
 Equity income 15.8 14.6 15.8
 General corporate income (expense) 192.2 (91.9) (85.3)
 Income before income taxes 634.7 509.4 495.4
 Provision for income taxes 234.8 178.3 168.4
 Income before extraordinary
 item and cumulative effect
 of accounting changes $ 399.9 $ 331.1 $ 327.0
 Earnings per common share $2.88 $2.35 $2.36
 (A) Excludes autofocus settlement, streamlining provision and impact of new accounting standards.
 - Autofocus settlement of $287.9 is included in general corporate expense
 - Streamlining provision of $128.4 is included as follows: Home and Building Control $42.7, Industrial $38.6, Space and Aviation $34.9, Other $2.6 and general corporate expense $9.6
 - Impact of adopting SFAS 106 and SFAS 112 of $20.2 is included as follows: Home and Building Control $5.3, Industrial $4.9, Space and Aviation $8.6, Other $0.6 and general corporate expense $0.8
 -0- 2/16/93
 /CONTACT: Kevin Whalen of Honeywell Inc., 612-951-0070/
 (HON)


CO: Honeywell Inc. ST: Minnesota IN: CPR SU: ERN

DS -- MN008 -- 6810 02/16/93 10:40 EST
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