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Honeywell Income Rises 28 Percent

July 16, 1998

MINNEAPOLIS (AP) _ Honeywell Inc. reported Thursday that second-quarter earnings rose 28 percent over the previous year on improved profit margins and strong sales of space and aviation controls.

Honeywell, which makes controls for the home, industrial, aviation and space markets, earned $125.8 million, or 98 cents per diluted share, compared with $98.4 million, or 76 cents a share, the same period a year ago.

About 6 cents per share of the improved results came from an accounting rule change related to the company’s internal software. The software is now depreciated over time instead of counted as an immediate expense. Another 3 cents per share of the earnings related to the sale of non-strategic assets.

Analysts surveyed by First Call had expected earnings of 93 cents a share. Honeywell’s stock fell $4.37 1/2 to close at $85.62 1/2 on the New York Stock Exchange.

Revenue rose 3 percent to $2.04 billion from $1.98 billion in the quarter ended July 5.

``The breadth of our global business, the strength of our strategies and our focus on operational excellence are enabling us to generate strong growth in shareowner value, even in a less robust global economic environment,″ said Michael Bonsignore, chairman and chief executive of the Minneapolis-based company.

Sales rose 18 percent to $579.2 million in Honeywell’s space and aviation control section. Operating profit was $77.8 million, compared to $61.8 million a year earlier.

For the first six months, Honeywell earned $222.1 million, or $1.73 per share, compared to $174 million, or $1.35 per share a year earlier. Sales were up 8 percent to $3.96 billion.

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