Honeywell’s ACS Division Posts 7% Gain

MORRIS TOWNSHIP, N.J.

April 17, 2003 SSI Staff

Honeywell Int’l’s first-quarter profit fell 32 percent as slightly higher revenues were offset by higher overhead and materials costs, particularly for specialty materials made with oil derivatives and gas.

The company reports net income of $254 million, or 30 cents per share. In 2002’s first quarter, Honeywell earned $376 million, or 46 cents per share. Revenues totaled $5.4 billion, up nearly 4 percent from $5.2 billion a year earlier. However, the company noted that revenues would have been flat if not for the effect of favorable foreign exchange rates due to the weak U.S. dollar.

Sales were down 1 percent, at $2 billion, at Honeywell’s biggest division, aerospace products, as the slump in the commercial airline industry continues. However, the other three divisions posted first-quarter revenue increases, fueled by the favorable exchange rates. Sales under its building automation and control systems segment, which includes Ademco Group, Fire-Lite and Northern Computers, increased 7 percent.

Overall, CEO Dave Cote said, due to the higher oil costs and reduced expectations on sales of commercial aircraft electronics and other systems, Honeywell likely will “come in at the bottom of our original earnings forecast. We’re taking actions now that will enable us to emerge from the difficult market conditions” stronger, he says.

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