HONEYWELL PLANS TO CUT 16,000 JOBS, CLOSE 51 SITES BY YEAR-END
Honeywell Int’l announced Monday it would take a charge of up to $1 billion against earnings as it cuts jobs and facilities amid a weak economy. Honeywell CEO Larry Bossidy said the company will have to cut 16,000 jobs, or 13 percent of its work force, by the end of this year.
By year-end, Honeywell will also have closed 51 sites, Bossidy told financial analysts. He added that several businesses are not considered core to Honeywell, and that they would likely be sold off. But he noted that the current market environment would not allow Honeywell to divest those operations immediately. He also reiterated that the company is not for sale.
Of the third-quarter charge, about $400 million to $500 million will be related to furloughing 10,500 people. The charge also will consist of about $300 million for relocating and disposing some facilities and $230 million related to environmental issues, Bossidy said.
The move comes after Honeywell took $651 million in charges in the second quarter related in part to its abandoned deal with GE earlier this year. The company reported second-quarter earnings of $50 million, or six cents per share, including the charges. Operating earnings fell 26 percent for the period.
Bossidy made no specific comments on the outlook for earnings per share for the third quarter. In addition, Bossidy said the company plans to have cut 5,000 positions of a total 37,500 at its aerospace business by the end of the year. However, the aerospace operation could gain from discussions with federal regulators on beefing up security in U.S. airports and aboard commercial aircraft.
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