In advance of its year-end 2008 earnings announcement next month, Honeywell today said it is on track with earlier guidance to deliver 6% sales growth and a 20% increase in earnings per share.
Honeywell anticipates reporting total annual sales of $36.6 billion, and earnings per share in the range of $3.76 to $3.80. Revenue in fiscal 2007 totaled $34.6 billion, while earnings per share reached $3.16. Free cash flow in 2009 is expected to be $3.2 billion. Late last week, the diversified automation vendor announced its fifth consecutive yearly dividend increase, a 10% boost to $1.21 per common share from $1.10, effective with the first-quarter 2009 dividend payment.
Looking ahead, the company gave guidance for the coming year, calling for a decline in sales, which officials expect to be in a range of $33.6 billion to $35.3 billion, with earnings per share of $3.20 to $3.55. Today, Honeywell said that factors likely to affect whether the company comes in at the high end or low end include the global economy, inflation, currency fluctuations, and whether Honeywell has the right mix of products. Among the company’s various businesses, Defense & Space, Building Solutions, and Process Solutions will be the main contributors to organic sales, officials predicted. Other groups, including Sensors & Control, Security, Turbo, and Specialty Materials are expected to be under considerably more pressure.
In remarks to financial analysts this morning, senior VP and CFO Dave Anderson said that Honeywell performed well in 2008 despite “tough economic conditions, particularly in the second half,” and continues to win new business. He credited a corporate strategy, initiated in 2006, to prepare for slower growth. “Since 2006, we’ve funded almost $700 million of repositioning operations,” he said.