Textron cuts 2013 jet outlook on 1Q earnings

DUE TO SLOWER-THAN-PROJECTED sales in the business jet market, Textron cut its 2013 jet-delivery outlook, the company said in its first quarter earnings report, released Wednesday.
Posted 4/17/13

PROVIDENCE – Textron Inc. – parent of Bell Helicopter, Cessna Aircraft Company and Textron Systems – posted net income of $119 million, or 41 cents per diluted share, during the first quarter, a very slight increase from the $118 million, or 40 cents per diluted share, it posted during the first quarter of 2012.

The diversified manufacturer and finance company saw revenue rise 0.03 percent during the quarter, to $2.86 billion. Manufacturing revenue alone totaled $2.81 billion, a 0.6 percent increase from manufacturing revenue reported for the first quarter of 2012.

Textron profits fell in its Cessna, Bell and “industrial” segments during the three months ended March 30. The Cessna segment reported a loss of $8 million, compared with a loss of $6 million during the same quarter last year. Bell Helicopter’s profits fell 11 percent from $145 million in the first quarter of 2012 to $129 million during the first quarter of 2013. The company’s “industrial” segment’s profits fell 21.9 percent to $57 million during the quarter.

Textron Systems saw profits rise 8.6 percent to $38 million year over year. The finance segment’s profits surged 58.3 percent to $19 million from $12 million.

“We saw strong growth in Bell commercial helicopters, Textron System defense products and E-Z-GO vehicles, but demand in the business jet market was softer than expected,” Textron Chairman and CEO Scott C. Donnelly said in prepared remarks.

Donnelly announced that, due to the current business jet market conditions, Textron is reducing its 2013 business jet delivery outlook and expects fewer deliveries in 2013 compared with 2012.

Donnelly added that the company also planned to adjust production schedules and implement “other appropriate cost actions” at Cessna.

“While we are taking these immediate actions, we believe the global business jet market still has significant long-term growth potential and we remain committed to our new product plans, which include the introduction of the M2, and new Sovereign and Citation X models later this year, as well as the Latitude in 2015 and the Longitude in 2017.”

Textron’s 2013 guidance for earnings per share from continuing operations is $1.90 to $2.10, according to a company release. Cash flow from continuing operations of the manufacturing group before pension contributions is expected to be roughly $400 million, with pension contributions of roughly $200 million.

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