United Technologies Beats

United Technologies Corporation (UTX - Analyst Report) reported third quarter 2009 earnings per share of $1.14 and net income attributable to common shareowners of $1.1 billion, down 14% and 17%, respectively, from the year ago quarter. This was ahead of the Zacks Consensus Estimate of $1.12. 

Revenues for the quarter at $13.4 billion were 11% below prior year including organic decline (7%) and adverse foreign currency translation (3%). Segment operating margin at 14.5% was 20 basis points higher than the prior year. 

Cash flow from operations less capital expenditures was 160% of net income attributable to common shareowners on significant inventory reductions across both commercial and aerospace businesses. Cash flow from operations was $1.9 billion, including $150 million of domestic pension contributions. Capital expenditures were $161 million in the quarter. 

United Technologies expects 2009 earnings per share at $4.10, the midpoint of the prior range of $4.00 to $4.20. The current Zacks Consensus Estimate stands at $4.09 per share. This guidance also reflects higher restructuring of $800 million this year with one-time gains of around $175 million, compared with $750 million of restructuring and $200 million of gains assumed earlier. 

Cash and equivalents stood at $4.6 billion with long term debt at $8.7 billion and shareowner’s equity at $11.3 billion at the end of the quarter. Debt to total capitalization was at 35%, an improvement from 40% at the beginning of the year. 

United Technologies Corporation provides high technology products and services to building systems and aerospace industries worldwide. Major competitors are General Electric Company (GE - Analyst Report) and Boeing Company (BA - Analyst Report). 

We currently have a Neutral recommendation on United Technologies.

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