HONEYWELL INTERNATIONAL
Honeywell Reports Strong Finish to 2016
- Fourth-Quarter Growth Led By UOP, Solstice®, And Home And Building
Technologies
- Strong Fourth-Quarter Segment Margin Expansion Driven By Productivity And
Repositioning Benefits
- Fourth-Quarter Free Cash Flow Conversion Of 126%(1)
- Full-Year Sales of $39.3 Billion, Up 2%, Driven By Acquisitions
MORRIS PLAINS, N.J., Jan. 27, 2017 -- Honeywell (NYSE: HON) today announced
results for the fourth quarter and full-year of 2016, and reaffirmed 2017
earnings guidance.
"We finished 2016 with a strong fourth quarter, achieving 14% earnings growth
(excluding divestitures and charges for pension mark-to-market and debt
refinancing), 90 basis points of segment margin expansion excluding M&A, and
free cash flow conversion of 126%," said Honeywell Chairman and CEO Dave Cote.
"For the full year, we delivered earnings growth of 8% (excluding charges for
pension mark-to-market and debt refinancing) and drove strong operational
segment margin expansion while making significant investments for the future,
including over $250 million in incremental Aerospace OEM incentives (the
equivalent of four percentage points of EPS). We funded high-return capital
projects through more than $1 billion in capital expenditures, marking the
third consecutive year of reinvesting at over 150% of depreciation, and we
continued to upgrade our growth profile through acquisitions totaling more than
$2.5 billion and divestitures with aggregate annual revenues in excess of $1
billion. To better drive top-line growth and improve our overall
decision-making speed, we realigned our business segments and funded more than
$250 million in internal restructuring projects. In addition, our debt
refinancing will reduce our expected 2017 interest expense by about 8% despite
increasing total borrowings by $4 billion, and we returned nearly $4.5 billion
to our shareowners through dividends and share repurchases."
Cote concluded, "We delivered outstanding returns again in 2016 with a total
shareowner return of 15%, which exceeded the S&P's total shareowner return by
300 basis points. More importantly, we set the stage for a successful 2017. I
am confident in our ability to continue to outperform under Darius Adamczyk. It
has been an honor to lead Honeywell for the past 15 years, and I know that our
best days are ahead of us."
1 Cash Flow From Operations Less Capital Expenditures; Free Cash Flow
Conversion = Free Cash Flow / Net Income, Excluding Pension Mark-To-Market
Adjustment And Debt Refinancing Charges
Throughout this press release, core organic sales growth refers to reported
sales growth less the impacts from foreign currency translation, M&A and raw
materials pass-through pricing in the former Resins & Chemicals business
previously part of Performance Materials and Technologies. The raw materials
pricing impact is excluded in instances where raw materials costs are passed
through to customers, which drives fluctuations in selling prices not tied to
volume growth. A reconciliation of core organic sales growth to reported sales
growth is provided in the attached financial tables.
Darius Adamczyk, President and Chief Operating Officer said, "Our business will
benefit in the future from the investments we made in 2016. All of these
actions, combined with our focus on enhancing organic growth, and the power of
our connected businesses, make us optimistic about 2017 and beyond. We are
reaffirming our 2017 earnings guidance today. As I discussed on our December
outlook call, Honeywell will continue our focus on driving organic growth and
margin expansion through new software opportunities, breakthrough initiatives,
and an improved customer experience. We look forward to discussing this more at
our annual investor conference on March 1 in New York City."
Honeywell will discuss the results during its investor conference call today
starting at 9:30 a.m. EST.
Fourth Quarter Performance
Honeywell sales for the fourth quarter were flat on a reported basis and down
1% on a core organic basis. The difference between reported and core organic
sales is due to the impact of acquisitions, primarily Elster and Intelligrated,
partially offset by the spin-off of Resins and Chemicals in Performance
Materials and Technologies and the divestiture of the Aerospace government
services business. The fourth-quarter and full-year 2016 financial results can
be found in Tables 1 and 2 below.
Aerospace sales for the fourth quarter were down 5% on a core organic basis.
The decrease was primarily driven by lower volumes in Business and General
Aviation, higher OEM incentives, program completions in U.S. Space and
International Defense, and continued weakness in the commercial helicopter
business, as expected. This was partially offset by global gas turbo
penetration in passenger vehicles in Transportation Systems. Segment margin
declined 130 bps to 20.2%, due to higher OEM incentives, product mix, and lower
volumes, partially offset by productivity net of inflation and commercial
excellence. Excluding the impact of acquisitions and higher OEM incentives,
segment margin contracted by 10 basis points.
Home and Building Technologies sales for the fourth quarter were up 2% on a
core organic basis driven by continued strength in our Building Solutions and
Distribution businesses, double-digit growth in China and India, and new
product introductions in Environmental and Energy Solutions. Segment margin
declined 30 bps to 16.8%, primarily driven by acquisition amortization and
integration costs. Excluding the impact of acquisitions, segment margin
expanded 60 basis points driven by benefits from previously-funded
restructuring and commercial excellence, partially offset by the unfavorable
impact of higher Distribution sales and growth investments.
Performance Materials and Technologies sales for the fourth quarter were up 5%
on a core organic basis driven by strong catalyst, licensing, and equipment
growth in UOP and a continued ramp in Solstice® sales in Advanced Materials.
Segment margin expanded 520 bps to 25.4%, driven by productivity net of
inflation, the favorable impact from the spin-off of AdvanSix, higher catalyst
volumes, and commercial excellence. Excluding the impact of acquisitions,
segment margin expanded by 560 bps.
Safety and Productivity Solutions sales for the fourth quarter were down 6% on
a core organic basis as a result of lower volumes in the Productivity and
Safety businesses and supply chain delays. Segment margin contracted 100 bps to
14.3%, primarily driven by acquisition amortization and integration costs.
Excluding the impact of acquisitions, segment margin expanded by 100 bps driven
by restructuring benefits and commercial excellence, partially offset by lower
volumes across the portfolio.
To participate in today's conference call, please dial (800) 263-0877
(domestic) or (719) 457-1036 (international) approximately ten minutes before
the 9:30 a.m. EST start. Please mention to the operator that you are dialing in
for Honeywell's fourth quarter 2016 earnings call or provide the conference
code HON4Q16. The live webcast of the investor call as well as related
presentation materials will be available through the "Investor Relations"
section of the company's Website (www.honeywell.com/investor). Investors can
hear a replay of the conference call from 12:30 p.m. EST, January 27, until 12:
30 p.m. EST, February 3, by dialing (888) 203-1112 (domestic) or (719) 457-0820
(international). The access code is 2675177.
TABLE 1: SUMMARY OF FINANCIAL RESULTS - TOTAL HONEYWELL
($ Millions, except Earnings Per Share) FY 2015 FY 2016 Change
Sales 38,581 39,302 2%
Core Organic (1%)
Segment Margin 18.8% 18.3% (50) bps
Ex-M&A 10 bps
Operating Income Margin 17.7% 17.0% (70) bps
Ex-Pension MTM And Debt Refinancing 17.9% 18.0% 10 bps
Earnings Per Share
Reported $6.04 $6.20 3%
Ex-Pension MTM And Debt Refinancing $6.10 $6.60 8%
Cash Flow From Operations 5,519 5,498 ~Flat
Free Cash Flow2 4,446 4,403 (1%)
4Q 2015 4Q 2016
Sales 9,982 9,985 ~Flat
Core Organic (1%)
Segment Margin 18.8% 19.0% 20 bps
Ex-M&A 90 bps
Operating Income Margin 17.4% 16.2% (120) bps
Ex-Pension MTM And Debt Refinancing 18.0% 20.2% 220 bps
Earnings Per Share
Reported $1.53 $1.34 (12%)
Ex-Pension MTM And Debt Refinancing $1.58 $1.74 10%
Ex-Divestitures, Pension MTM, Debt Refinancing $1.53 $1.74 14%
Cash Flow From Operations 1,963 2,042 4%
Free Cash Flow2 1,575 1,696 8%
2 Cash Flow From Operations Less Capital Expenditures
TABLE 2: SUMMARY OF FINANCIAL RESULTS - SEGMENTS
AEROSPACE FY 2015 FY 2016 Change
Sales 15,237 14,751 (3%)
Segment Profit 3,218 2,991 (7%)
Segment Margin 21.1% 20.3% (80) bps
Ex-M&A (60) bps
4Q 2015 4Q 2016
Sales 3,983 3,666 (8%)
Segment Profit 856 739 (14%)
Segment Margin 21.5% 20.2% (130) bps
Ex-M&A, Other3 (10) bps
HOME AND BUILDING TECHNOLOGIES FY 2015 FY 2016 Change
Sales 9,161 10,654 16%
Segment Profit 1,512 1,683 11%
Segment Margin 16.5% 15.8% (70) bps
Ex-M&A 40 bps
4Q 2015 4Q 2016
Sales 2,475 2,800 13%
Segment Profit 424 470 11%
Segment Margin 17.1% 16.8% (30) bps
Ex-M&A 60 bps
PERFORMANCE MATERIALS AND TECHNOLOGIES FY 2015 FY 2016 Change
Sales 9,475 9,272 (2%)
Segment Profit 1,990 2,050 3%
Segment Margin 21.0% 22.1% 110 bps
Ex-M&A 150 bps
4Q 2015 4Q 2016
Sales 2,338 2,228 (5%)
Segment Profit 473 566 20%
Segment Margin 20.2% 25.4% 520 bps
Ex-M&A 560 bps
SAFETY AND PRODUCTIVITY SOLUTIONS FY 2015 FY 2016 Change
Sales 4,708 4,625 (2%)
Segment Profit 746 680 (9%)
Segment Margin 15.8% 14.7% (110) bps
Ex-M&A (40) bps
4Q 2015 4Q 2016
Sales 1,186 1,291 9%
Segment Profit 181 185 2%
Segment Margin 15.3% 14.3% (100) bps
Ex-M&A 100 bps
3 Excludes ~$48M Increase In Aero OEM Incentives YoY
Honeywell (http://www.honeywell.com/) is a Fortune 100 diversified technology
and manufacturing leader, serving customers worldwide with aerospace products
and services; control technologies for buildings, homes, and industry;
turbochargers; and performance materials. For more news and information on
Honeywell, please visit www.honeywell.com/newsroom.
This release contains certain statements that may be deemed "forward-looking
statements" within the meaning of Section 21E of the Securities Exchange Act of
1934. All statements, other than statements of historical fact, that address
activities, events or developments that we or our management intends, expects,
projects, believes or anticipates will or may occur in the future are
forward-looking statements. Such statements are based upon certain assumptions
and assessments made by our management in light of their experience and their
perception of historical trends, current economic and industry conditions,
expected future developments and other factors they believe to be appropriate.
The forward-looking statements included in this release are also subject to a
number of material risks and uncertainties, including but not limited to
economic, competitive, governmental, and technological factors affecting our
operations, markets, products, services and prices. Such forward-looking
statements are not guarantees of future performance, and actual results,
developments and business decisions may differ from those envisaged by such
forward-looking statements. We identify the principal risks and uncertainties
that affect our performance in our Form 10-K and other filings with the
Securities and Exchange Commission.
Honeywell International Inc
Consolidated Statement of Operations (Unaudited)
(Dollars in millions, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
Product sales $ 7,964 $ 7,960 $ 31,362 $ 30,695
Service sales 2,021 2,022 7,940 7,886
Net sales 9,985 9,982 39,302 38,581
Costs, expenses and other
Cost of products sold (A) 5,625 5,649 22,170 21,775
Cost of services sold (A) 1,254 1,268 4,980 4,972
6,879 6,917 27,150 26,747
Selling, general and administrative expenses (A) 1,493 1,332 5,469 5,006
Other (income) expense 95 (4) (102) (68)
Interest and other financial charges 86 84 338 310
8,553 8,329 32,855 31,995
Income before taxes 1,432 1,653 6,447 6,586
Tax expense 387 450 1,601 1,739
Net income 1,045 1,203 4,846 4,847
Less: Net income attributable to the noncontrolling 11 9 37 79
interest
Net income attributable to Honeywell $ 1,034 $ 1,194 $ $
4,809 4,768
Earnings per share of common stock - basic $ $ $ $
1.36 1.55 6.29 6.11
Earnings per share of common stock - assuming $ $ $ $
dilution 1.34 1.53 6.20 6.04
Weighted average number of shares outstanding - basic 762.4 771.8 764.3 779.8
Weighted average number of shares outstanding - 772.3 780.8 775.3 789.3
assuming dilution
(A) Cost of products and services sold and selling, general and administrative
expenses include amounts for repositioning and other charges, pension and other
postretirement (income) expense, and stock compensation expense.
Below is a reconciliation of earnings per share to earnings per share,
excluding pension mark-to-market expense, debt refinancing expense and earnings
attributable to 2016 divestitures. We believe this measure is useful to
investors and management in understanding our ongoing operations and in
analysis of ongoing operating trends. Earnings per share utilizes weighted
average number of shares outstanding, assuming dilution, for the period.
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
Earnings per share of common $ 1.34 $ 1.53 $ 6.20 $ 6.04
stock - assuming dilution
Pension mark-to-market 0.28 0.05 0.28 0.06
expense (1)
Debt refinancing expense (2) 0.12 - 0.12 -
Earnings per share of common
stock - assuming dilution,
excluding pension
mark-to-market expense and $ 1.74 $ 1.58 $ 6.60 $ 6.10
debt refinancing expense
Earnings attributable to - (0.05) (0.14) (0.19)
2016 Divestitures (3)
Earnings per share of common
stock - assuming dilution,
excluding pension
mark-to-market expense, debt $ 1.74 $ 1.53 $ 6.46 $ 5.91
refinancing expense, and
2016 divestitures
(1) Pension mark-to-market expense uses a blended tax rate of 21.3% and 36.1%
for 2016 and 2015.
(2) Debt refinancing expense uses a tax rate of 26.5% for 2016.
(3) Earnings attributable to 2016 divestitures use a blended tax rate of 30.8%
for three months ended December 31, 2015, 33.9% for 2016 and 33.2% for 2015.
Honeywell International Inc
Segment Data (Unaudited)
(Dollars in millions)
Three Months Ended Twelve Months Ended
December 31, December 31,
Net Sales 2016 2015 2016 2015
Aerospace $ 3,666 $ 3,983 $ 14,751 $ 15,237
Home and Building Technologies 2,800 2,475 10,654 9,161
Performance Materials and Technologies 2,228 2,338 9,272 9,475
Safety and Productivity Solutions 1,291 1,186 4,625 4,708
Corporate - - - -
Total $ 9,985 $ 9,982 $ 39,302 $ 38,581
Reconciliation of Segment Profit to Income Before Taxes
Three Months Ended Twelve Months Ended
December 31, December 31,
Segment Profit 2016 2015 2016 2015
Aerospace $ 739 $ 856 $ 2,991 $ 3,218
Home and Building Technologies 470 424 1,683 1,512
Performance Materials and Technologies 566 473 2,050 1,990
Safety and Productivity Solutions 185 181 680 746
Corporate (61) (54) (218) (210)
Total segment profit 1,899 1,880 7,186 7,256
Other income (expense) (A) (103) (1) 71 38
Interest and other financial charges (86) (84) (338) (310)
Stock compensation expense (B) (39) (43) (184) (175)
Pension ongoing income (B) 154 131 601 430
Pension mark-to-market expense (B) (273) (67) (273) (67)
Other postretirement income (expense) (B) 8 (10) 32 (40)
Repositioning and other charges (B) (128) (153) (648) (546)
Income before taxes $ 1,432 $ 1,653 $ 6,447 $ 6,586
(A) Equity income (loss) of affiliated companies is included in segment profit.
(B) Amounts included in cost of products and services sold and selling, general and
administrative expenses.
Honeywell International Inc
Consolidated Balance Sheet (Unaudited)
(Dollars in millions)
December 31, December 31,
2016 2015
ASSETS
Current assets:
Cash and cash equivalents $ $
7,843 5,455
Accounts, notes and other receivables 8,818 8,075
Inventories 4,366 4,420
Investments and other current assets 2,031 2,103
Total current assets 23,058 20,053
Investments and long-term receivables 587 517
Property, plant and equipment - net 5,793 5,789
Goodwill 17,707 15,895
Other intangible assets - net 4,634 4,577
Insurance recoveries for asbestos related liabilities 417 426
Deferred income taxes 347 283
Other assets 1,603 1,776
Total assets $ 54,146 $ 49,316
LIABILITIES AND SHAREOWNERS' EQUITY
Current liabilities:
Accounts payable $ $
5,690 5,580
Commercial paper and other short-term borrowings 3,366 5,937
Current maturities of long-term debt 227 577
Accrued liabilities 7,048 6,277
Total current liabilities 16,331 18,371
Long-term debt 12,182 5,554
Deferred income taxes 486 558
Postretirement benefit obligations other than pensions 473 526
Asbestos related liabilities 1,014 1,251
Other liabilities 4,110 4,348
Redeemable noncontrolling interest 3 290
Shareowners' equity 19,547 18,418
Total liabilities, redeemable noncontrolling interest and shareowners' $ 54,146 $ 49,316
equity
Honeywell International Inc
Consolidated Statement of Cash Flows (Unaudited)
(Dollars in millions)
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
Cash flows from operating activities:
Net income $ 1,045 $ 1,203 $ 4,846 $ 4,847
Less: Net income attributable to the noncontrolling interest 11 9 37 79
Net income attributable to Honeywell 1,034 1,194 4,809 4,768
Adjustments to reconcile net income attributable to Honeywell to net
cash provided by operating activities:
Depreciation 180 169 726 672
Amortization 77 53 304 211
(Gain) loss on sale of non-strategic businesses and assets (2) 2 (178) 1
Repositioning and other charges 128 153 695 546
Net payments for repositioning and other charges (205) (208) (625) (537)
Pension and other postretirement expense (income) 111 (54) (360) (323)
Pension and other postretirement benefit payments (33) (38) (143) (122)
Stock compensation expense 39 43 184 175
Deferred income taxes (70) 31 76 315
Excess tax benefits from share based payment arrangements - (12) - (81)
Other 227 (94) 194 57
Changes in assets and liabilities, net of the effects of
acquisitions and divestitures:
Accounts, notes and other receivables (200) 159 (770) 211
Inventories 215 250 (18) 230
Other current assets 39 191 117 80
Accounts payable 272 (4) 254 (17)
Accrued liabilities 230 128 233 (667)
Net cash provided by operating activities 2,042 1,963 5,498 5,519
Cash flows from investing activities:
Expenditures for property, plant and equipment (346) (388) (1,095) (1,073)
Proceeds from disposals of property, plant and equipment 17 12 21 15
Increase in investments (871) (1,013) (3,954) (6,714)
Decrease in investments 1,023 2,537 3,681 6,587
Cash paid for acquisitions, net of cash acquired (5) (5,043) (2,573) (5,228)
Proceeds from sales of businesses, net of fees paid (8) (2) 296 1
Other 124 (33) 282 (102)
Net cash used for investing activities (66) (3,930) (3,342) (6,514)
Cash flows from financing activities:
Net increase (decrease) in commercial paper and other short-term (2,039) 2,254 (2,464) 4,265
borrowings
Proceeds from issuance of common stock 23 36 409 186
Proceeds from issuance of long-term debt 4,735 12 9,245 60
Payments of long-term debt (2,361) (732) (2,839) (880)
Excess tax benefits from share based payment arrangements - 12 - 81
Repurchases of common stock (213) (163) (2,079) (1,884)
Cash dividends paid (505) (465) (1,915) (1,726)
Payments to purchase the noncontrolling interest - - (238) -
AdvanSix pre-separation funding - - 269 -
AdvanSix pre-spin borrowing - - 38 -
AdvanSix cash at spin-off - - (38) -
Other (2) (4) (42) (65)
Net cash provided by (used for) financing activities (362) 950 346 37
Effect of foreign exchange rate changes on cash and cash equivalents (202) (91) (114) (546)
Net increase (decrease) in cash and cash equivalents 1,412 (1,108) 2,388 (1,504)
Cash and cash equivalents at beginning of period 6,431 6,563 5,455 6,959
Cash and cash equivalents at end of period $ 7,843 $ 5,455 $ 7,843 $ 5,455
Honeywell International Inc
Reconciliation of Cash Provided by Operating Activities to Free Cash Flow and
Calculation of Free Cash Flow Conversion (Unaudited)
(Dollars in millions)
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
Cash provided by operating activities $ 2,042 $ 1,963 $ 5,498 $ 5,519
Expenditures for property, plant and equipment (346) (388) (1,095) (1,073)
Free cash flow $ 1,696 $ 1,575 $ 4,403 $ 4,446
Net income, attributable to Honeywell $ 1,034 $ 1,194 $ 4,809 $ 4,768
Pension mark-to-market expense, net of tax (A) 215 43 215 43
Debt refinancing expense (B) 93 - 93 -
Net income, attributable to Honeywell, excluding pension mark-to-market expense
and debt refinancing expense $ 1,342 $ 1,237 $ 5,117 $ 4,811
Cash provided by operating activities $ 2,042 $ 1,963 $ 5,498 $ 5,519
÷ Net income attributable to Honeywell $ 1,034 $ 1,194 $ 4,809 $ 4,768
Operating cash flow conversion 197% 164% 114% 116%
Free cash flow $ 1,696 $ 1,575 $ 4,403 $ 4,446
Net income, attributable to Honeywell, excluding pension mark-to-market expense
and debt refinancing expense $ 1,342 $ 1,237 $ 5,117 $ 4,811
Free cash flow conversion 126% 127% 86% 92%
(A) Pension mark-to-market expense uses a blended tax rate of 21.3% and 36.1%
for 2016 and 2015.
(B) Debt refinancing expense uses a tax rate of 26.5% for 2016.
We define free cash flow as cash provided by operating activities less cash
expenditures for property, plant and equipment.
We believe that this metric is useful to investors and management as a measure
of cash generated by business operations that will be used to repay scheduled
debt maturities and can be used to invest in future growth through new business
development activities or acquisitions, pay dividends, repurchase stock or
repay debt obligations prior to their maturities. This metric can also be used
to evaluate our ability to generate cash flow from business operations and the
impact that this cash flow has on our liquidity.
Honeywell International Inc
Reconciliation of Segment Profit to Operating Income and Calculation of Segment
Profit and Operating Income Margins (Unaudited)
(Dollars in millions)
Three Months Ended Twelve Months Ended
December 31, December 31,
2016 2015 2016 2015
Segment Profit $ 1,899 $ 1,880 $ 7,186 $ 7,256
Stock compensation expense (A) (39) (43) (184) (175)
Repositioning and other (A, B) (136) (158) (679) (576)
Pension ongoing income (A) 154 131 601 430
Pension mark-to-market expense (A) (273) (67) (273) (67)
Other postretirement income (expense) (A) 8 (10) 32 (40)
Operating Income $ 1,613 $ 1,733 $ 6,683 $ 6,828
Pension mark-to-market adjustment (A) (273) (67) (273) (67)
Debt refinancing expense (126) - (126) -
Operating Income excluding pension mark-to-market adjustment
and debt refinancing expense $ 2,012 $ 1,800 $ 7,082 $ 6,895
Segment Profit $ 1,899 $ 1,880 $ 7,186 $ 7,256
÷ Sales 9,985 9,982 39,302 38,581
Segment Profit Margin % 19.0% 18.8% 18.3% 18.8%
Operating Income $ 1,613 $ 1,733 $ 6,683 $ 6,828
÷ Sales 9,985 9,982 39,302 38,581
Operating Income Margin % 16.2% 17.4% 17.0% 17.7%
Operating Income excluding pension mark-to-market adjustment
and debt refinancing expense $ 2,012 $ 1,800 $ 7,082 $ 6,895
÷ Sales 9,985 9,982 39,302 38,581
Operating Income excluding pension mark-to-market adjustment
and debt refinancing expense % 20.2% 18.0% 18.0% 17.9%
(A) Included in cost of products and services sold and selling, general and
administrative expenses.
(B) Includes repositioning, asbestos, environmental expenses and equity income
adjustment.
We believe these measures are useful to investors and management in
understanding our ongoing operations and in analysis of ongoing operating
trends.
Honeywell International Inc
Calculation of Segment Profit Margin Excluding Mergers and Acqusitions
(Unaudited)
(Dollars in millions)
Three Months Ended
December 31
2016
Honeywell
Segment Profit excluding mergers and acquisitions $
1,833
÷ Sales excluding mergers and acquisitions $
9,284
Segment Profit Margin excluding mergers and acquisitions % 19.7%
Aerospace (1)
Segment Profit excluding mergers and acquisitions and other $
786
÷ Sales excluding mergers and acquisitions and other $
3,677
Segment Profit Margin excluding mergers and acquisitions 21.4%
and other %
Home and Building Technologies
Segment Profit excluding mergers and acquisitions $
436
÷ Sales excluding mergers and acquisitions $
2,463
Segment Profit Margin excluding mergers and acquisitions % 17.7%
Performance Materials and Technologies
Segment Profit excluding mergers and acquisitions $
540
÷ Sales excluding mergers and acquisitions $
2,093
Segment Profit Margin excluding mergers and acquisitions % 25.8%
Safety and Productivity Solutions
Segment Profit excluding mergers and acquisitions $
180
÷ Sales excluding mergers and acquisitions $
1,105
Segment Profit Margin excluding mergers and acquisitions % 16.3%
(1) Other includes year-over-year incremental OEM
incentives
We believe these measures are useful to investors and management in
understanding our ongoing operations and in analysis of ongoing operating
trends.
Honeywell International Inc
Calculation of Segment Profit Margin Excluding Mergers and Acqusitions
(Unaudited)
(Dollars in millions)
Twelve Months Ended
December 31
2016
Honeywell
Segment Profit excluding mergers and acquisitions $ 6,980
÷ Sales excluding mergers and acquisitions $ 37,023
Segment Profit Margin excluding mergers and acquisitions 18.9%
%
Aerospace
Segment Profit excluding mergers and acquisitions $ 2,992
÷ Sales excluding mergers and acquisitions $ 14,590
Segment Profit Margin excluding mergers and acquisitions 20.5%
%
Home and Building Technologies
Segment Profit excluding mergers and acquisitions $ 1,588
÷ Sales excluding mergers and acquisitions $ 9,374
Segment Profit Margin excluding mergers and acquisitions 16.9%
%
Performance Materials and Technologies
Segment Profit excluding mergers and acquisitions $ 1,959
÷ Sales excluding mergers and acquisitions $ 8,721
Segment Profit Margin excluding mergers and acquisitions 22.5%
%
Safety and Productivity Solutions
Segment Profit excluding mergers and acquisitions $
670
÷ Sales excluding mergers and acquisitions $ 4,338
Segment Profit Margin excluding mergers and acquisitions 15.4%
%
We believe these measures are useful to investors and management in
understanding our ongoing operations and in analysis of ongoing operating
trends.
Honeywell International Inc
Reconciliation of Core Organic Sales Growth (Unaudited)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2016 2016
Honeywell
Reported sales growth - 2%
Less: Foreign currency translation, acquisitions, 1% 3%
divestitures and other
Less: Raw materials pricing in R&C - -
Core organic sales growth (1%) (1%)
Performance Materials and Technologies
Reported sales growth (5%) (2%)
Less: Foreign currency translation, acquisitions, (10%) 1%
divestitures and other
Less: Raw materials pricing in R&C - (1%)
Core organic sales growth 5% (2%)
Throughout this press release, core organic sales growth refers to reported
sales growth less the impacts from foreign currency translation, M&A and raw
materials pass-through pricing in the former Resins & Chemicals business
previously part of Performance Materials and Technologies. The raw materials
pricing impact is excluded in instances where raw materials costs are passed
through to customers, which drives fluctuations in selling prices not tied to
volume growth.
We believe core organic sales growth is a measure that is useful to investors
and management in understanding our ongoing operations and in analysis of
ongoing operating trends.
Contacts:
Media Investor Relations
Robert C. Ferris Mark Macaluso
(973) 455-3388 (973) 455-2222
rob.ferris@honeywell.com mark.macaluso@honeywell.com
Honeywell International : Final Results
January 27, 2017 at 05:07 pm IST
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