Business Grows 14 Per Cent
“In the second quarter, all 4 Honeywell businesses saw increases in sales and improving end markets,” said Honeywell chairman and chief executive officer Dave Cote. “Double digit net income growth was driven by strong conversion on higher volume. We are benefiting from the depth and breadth of our technology, our strong customer relationships and the actions taken to prepare for the market turnaround we are now experiencing. We continue to fund growth initiatives that will translate into future opportunities across our businesses.”
The company’s net income increased to $US361 million for the quarter, with volume-driven profitability partially offset by the impact of higher non-cash pension expense. Free cash flow of $US357 million equals approximately 100% of net income. Net debt (total debt minus cash and cash equivalents) was $US1.9 billion, or 15 per cent of net capital (shareowners’ equity plus net debt).
“Order rates continue to be strong in all of our businesses,” Cote said.
“Automation and Control Solutions introduced a new touch screen programmable thermostat and won significant new contracts in its Building and Process Solutions businesses…In Specialty Materials, our Spectra bullet-resistant fiber and our broad fluorines product offerings continue to experience double digit orders growth.”
During the quarter the company continued to make progress divesting non-core businesses and improving its cost base. Divestitures (principally Security Monitoring) resulted in gains of $US233 million.