Revenues Down Last Year, But Company Positive About The Future

Textron is reporting fourth quarter 2015 income from continuing operations of $0.81 per share, up 6.6 percent from $0.76 per share in the fourth quarter of 2014.

Revenues in the quarter were $3.9 billion, down 4.2 percent compared to $4.1 billion in the fourth quarter of 2014. Textron segment profit in the quarter was $378 million, down $20 million from the fourth quarter of 2014. Fourth quarter manufacturing cash flow before pension contributions was $534 million compared to $449 million during last year’s fourth quarter.

“We had good execution in the quarter with margin improvements at Aviation, Systems and Industrial and solid double digit margins at Bell,” said Textron Chairman and CEO Scott C. Donnelly. “While overall revenues were down in the quarter, we were encouraged by continued strong demand at Industrial, the ramp-up of our new Latitude business jet and the positive customer reception to our new Longitude and Hemisphere jets announced during November’s National Business Aviation Association Exhibition.”

Full-year income from continuing operations was $2.50 per share, compared to $2.15 in 2014. Full-year 2015 manufacturing cash flow before pension contributions was $631 million compared to $753 million in 2014.

Textron is forecasting 2016 revenues of approximately $14.3 billion, up six percent, and earnings per share from continuing operations in the range of $2.60 to $2.80. The company is estimating cash flow from continuing operations of the manufacturing group before pension contributions will be between $600 and $700 million with planned pension contributions of about $60 million.

“Our outlook for 2016 reflects the success of our strategy of investing in both new product development and acquisitions," Donnelly said. "As we look to the future, we remain committed to making investments to drive growth and shareholder value.”

Revenues at Textron Aviation were down $32 million, primarily reflecting lower King Air and used pre-owned aircraft volumes partially offset by higher jet volume. Textron Aviation delivered 60 new jets and 33 King Airs in the quarter, compared to 55 jets and 41 King Airs in last year’s fourth quarter.

Textron Aviation recorded a segment profit of $138 million in the fourth quarter compared to $130 million a year ago. The increase is primarily due to improved performance, which included lower amortization of $8 million related to fair value step-up adjustments, partially offset by the impact of lower volumes.

Textron Aviation backlog at the end of the fourth quarter was $1.1 billion, down $308 million from the end of the third quarter.

Bell revenues decreased $36 million, primarily the result of lower commercial aftermarket volume and a change in mix of commercial aircraft delivered in the quarter partially offset by higher military deliveries. Bell delivered 8 V-22’s and 9 H-1’s in the quarter compared to 7 V-22’s and 7 H-1’s in last year’s fourth quarter and 56 commercial helicopters compared to 57 units last year.

Segment profit decreased $22 million, primarily due to unfavorable impact from the change in the mix of commercial aircraft delivered in the quarter and the lower commercial aftermarket volume partially offset by favorable performance.

Bell backlog at the end of the fourth quarter was $5.2 billion, up $76 million from the end of the third quarter.

(Source: Textron news release. Images from file)

FMI: www.textron.com