Tags: Textron | Profit | earnings | jets

Textron Profit Tops Wall Street Forecasts

Wednesday, 18 April 2012 08:12 AM

Diversified U.S. manufacturer Textron Inc. posted stronger-than-expected results for the first quarter, benefiting from a renewed demand for business aircraft and helicopters.

The world's largest maker of corporate jets said on Wednesday that earnings came to $118 million, or 40 cents per share, compared with $29 million, or 9 cents per share, a year earlier.

Analysts on average had forecast a profit of 35 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose 15.2 percent to $2.86 billion from $2.48 billion, beating analysts' estimates of $2.7 billion. Bell helicopter sales were up 32.7 percent, and Cessna aircraft sales rose 20.3 percent.

Textron affirmed its full-year profit forecast of $1.80 to $2.00 per share from continuing operations. The company said it expected revenue for the year to rise 11 percent to about $12.5 billion, driven by strong growth at Cessna and Bell.

Shares of the Providence, Rhode Island-based company have been on a tear this year, up about 46 percent, with most of those gains notched since it reported fourth-quarter results in January. That rise sharply outpaced the roughly 9 percent climb of the Standard & Poor's capital goods industry index.

The corporate jet market is rebounding from a deep slump triggered by the 2008 financial crisis, when tight budgets and image concerns prompted big companies to scale back their purchases of private aircraft.

The recovery from the downturn, and growing demand from rapidly developing economies, have boosted sales of small jets. But Cessna and its rivals, which include General Dynamics Corp.'s Gulfstream, Canada's Bombardier and Brazil's Embraer SA, are bracing for new competition next year when No. 3 world automaker Honda Motor Co. plans to launch its first aircraft, for which it began taking orders in 2006.

Cessna opened talks last month with China's AVIC aimed at forming a joint venture to produce business jets in the world's second-largest economy.

© 2018 Thomson/Reuters. All rights reserved.

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Wednesday, 18 April 2012 08:12 AM
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