MORRIS TOWNSHIP, N.J., Dec. 15, 2010 /PRNewswire-FirstCall/ -- Honeywell (NYSE: HON) announced today that it expects 2011 sales of $35 to 36 billion, up 6 to 9% versus 2010, and earnings per share of $3.50 to 3.70, up 17 to 24% compared to 2010 proforma earnings. Free cash flow (cash flow from operations less capital expenditures) before the planned U.S. pension contribution of $1 billion is expected to be in the range of $3.5 to 3.7 billion (cash flow from operations of $3.3 to 3.5 billion including pension contribution). The company also reaffirmed 2010 full-year guidance of approximately $33 billion in sales, $2.98 earnings per share (proforma), and $3.5 billion of free cash flow (cash flow from operations of approximately $4.1 billion). Earnings per share estimates for 2010 and 2011 include ongoing pension expense and exclude the estimated mark-to-market adjustment in 2010.
"Honeywell's strong performance in 2010 demonstrates the benefit of having great positions in good industries globally," said Honeywell Chairman and Chief Executive Officer Dave Cote. "Our short cycle businesses, such as turbochargers and general industrial products, led the way in 2010 with a robust recovery off low 2009 levels. And, our longer cycle businesses, including commercial aerospace, ACS Solutions, and UOP refining technologies, are showing meaningful signs of improvement, with double-digit growth in orders rates. These factors, together with the company's terrific execution, convey an even stronger 2011 for Honeywell."
"We're clearly growing faster than the markets we serve, and combined with the improved outlook for the global economy, we're confident in our expectations for higher revenues, segment margin expansion, strong cash flow, and double-digit earnings growth in 2011," continued Cote. "We'll continue to leverage investments in new products, technology differentiation, emerging market expansion, and our key process initiatives. These are the core elements of the Honeywell playbook and remain essential to our ability to outperform. Our continuous focus on seed planting for growth and productivity has positioned the company for growth next year and over the long-term."
Honeywell will discuss its 2011 Outlook during its investor conference call and Webcast starting at 9:00 a.m. EST today. To participate on the conference call, please dial (719) 325-2426 a few minutes before the 9:00 a.m. EST start. Please mention to the operator that you are dialing in for Honeywell's investor conference call. The live Webcast of the call will be available through the "Investor Relations" section of the company's Website www.honeywell.com/investor. Investors can access a replay of the conference call from 12:00 p.m. EST, December 15, until midnight, December 22, by dialing (719) 457-0820. The access code is 4135997.
Honeywell (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; automotive products; turbochargers; and specialty materials. Based in Morris Township, N.J., Honeywell's shares are traded on the New York, London, and Chicago Stock Exchanges. For more news and information on Honeywell, please visit www.honeywellnow.com.
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.
Honeywell International Inc.
Reconciliation of Cash Provided by Operating Activities to Free Cash Flow
(Unaudited, dollars in billions)
Cash provided by operating activities
~ $3.3 - 3.5
Expenditures for property, plant and equipment
Free cash flow
~ 2.5 - 2.7
U.S. pension plan contributions
Free cash flow excluding U.S. pension plan contributions
~ $3.5 - 3.7
We define free cash flow as cash provided by operating activities, less cash expenditures for property, plant and equipment.
We believe that free cash flow and free cash flow excluding U.S. pension plan contributions are 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, and to 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.
We believe that earnings per share of common stock, excluding the mark-to-market pension adjustment is useful
to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.