Revenues Up 7.9 Percent Despite Fewer Jet Deliveries

Textron reported first quarter 2015 income from continuing operations of $0.46 per share, up 48.4 percent from $0.31 per share in the first quarter of 2014 in a report released Tuesday.

Revenues in the quarter were $3.1 billion, up 7.9 percent compared to $2.8 billion in the first quarter of 2014. Textron segment profit in the quarter was $259 million, up $40 million from the first quarter of 2014. First quarter manufacturing cash flow before pension contributions reflected a use of cash of $125 million compared to a use of cash of $111 million during last year’s first quarter.

“Revenues at Textron Aviation and Industrial were up during the quarter, while revenues at Bell and Textron Systems were down, as we expected,” said Textron Chairman and CEO Scott C. Donnelly. “Operationally, we achieved significant margin improvements at Textron Aviation and Industrial, reflecting strong performance in these segments.”

Donnelly continued, “While we expected military deliveries would be down at Bell this year, the medium segment of the commercial helicopter market remains soft. As a result, we are adjusting production levels and taking additional cost actions to allow Bell to perform within its targeted 2015 segment margin range of 11 to 12 percent.”

The company expects that the net impact of the Bell cost actions and lower commercial revenues on Textron’s expected 2015 earnings and cash flow will be offset by stronger results at Textron Aviation and Industrial.

Textron confirmed its 2015 earnings per share from continuing operations guidance of $2.30 to $2.50 and its expectation for cash flow from continuing operations of the manufacturing group before pension contributions of $550 to $650 million with planned pension contributions of about $80 million.

Revenues at Textron Aviation were up $266 million, primarily reflecting the impact of the Beechcraft acquisition. Textron Aviation delivered 33 new jets in the quarter, compared to 35 jets in last year’s first quarter, and 25 King Air turboprops.

Textron Aviation recorded a segment profit of $67 million in the first quarter compared to $14 million a year ago. The increase is primarily due to improved performance, reflecting the impact of the Beechcraft acquisition, and higher volumes.

Textron Aviation backlog at the end of the first quarter was $1.3 billion, down $99 million from the end of the fourth quarter.

Bell revenues decreased $60 million, primarily the result of lower V-22 deliveries.

Bell delivered 6 V-22’s and 4 H-1’s in the quarter, compared to 8 V-22’s and 5 H-1’s in last year’s first quarter and 35 commercial helicopters, compared to 34 units last year. Segment profit decreased $20 million primarily due to the lower volumes and an unfavorable mix of commercial aircraft deliveries.

Bell backlog at the end of the first quarter was $5.3 billion, down $237 million from the end of the fourth quarter.

(Image from file)

FMI: www.textron.com