Diversified U.S. conglomerate Textron Inc. (TXT - Free Report) reported first-quarter 2016 earnings from continuing operations of 55 cents per share, beating the Zacks Consensus Estimate of 53 cents by 3.8%. Earnings also increased 19.6% from 46 cents per share reported in the year-ago quarter.
Total revenue in the quarter was $3,201 million, beating the Zacks Consensus Estimate of $3,100 million by 3.3%. Revenues also increased 4.2% from the year-ago figure of $3,073 million, primarily on account of higher contribution from Textron Aviation, Textron Systems and Industrial.
Manufacturing revenues increased 4.3% year over year to $3,181 million while revenues from the Finance division declined 9.1% to $20 million during the quarter.
Textron Aviation: Revenues during the first quarter increased by 40 million to $1,091 million from $1,051 million in the year-ago quarter owing to higher jet volumes.
The company delivered 34 new jets and 26 King Air turboprops in the quarter, compared with 33 jets and 25 King Airs in the prior-year quarter.
The segment registered a profit of $73 million compared with $67 million in the year-ago quarter. Order backlog at the end of the first quarter was $1 billion, reflecting a decrease of $47 million from the preceding quarter.
Bell: Segment revenues were essentially flat at $814 million with the year-ago level of $813 million.
The segment delivered 30 commercial helicopters compared with 35 units in the prior-year period. Bell also delivered 6 V-22s (flat year over year) and 10 H-1s (4 in the year-ago quarter).
Segment profit increased 7.9% to $82 million. Bell’s order backlog at the end of the quarter was $5.3 billion, higher by $60 million from the fourth quarter of 2015.
Textron Systems: Revenues from this division during the reported quarter were $324 million, up 2.9% year over year. The upside was mainly due to higher Unmanned Systems volumes.
Segment profit of $29 million increased from $28 million a year ago.
Textron Systems’ backlog at the end of the first quarter was $2.5 billion, up $196 million from the end of the fourth quarter.
Industrial: Segment revenues increased 9.2% year over year to $952 million driven by higher volumes and acquisitions. Segment profit increased 11% to $91 million.
As of Apr 2, 2016, cash and cash equivalents were $723 million, compared with $946 million as of Jan 2, 2016.
Capital expenditure during the quarter was $88 million compared with $79 million in the year-ago quarter. Long-term debt was $2,800 million, as of Apr 2, 2016, up from $2,435 million as of Jan 2, 2016.
Textron maintained its 2016 earnings per share guidance in the range of $2.60 to $2.80.
The company continues to expect cash flow from continuing operations (of the manufacturing group) before pension contributions in the $600–$700 million band.
Lockheed Martin Corp. (LMT - Free Report) , Northrop Grumman Corp. (NOC - Free Report) and Raytheon Co. (RTN - Free Report) are expected to release their first-quarter 2016 results on Apr 26, Apr 27, Apr 28, respectively.
Textron’s 2016 outlook reflects the success of its strategy of investing in both new product development and acquisitions. Going ahead, the company intends to keep making investments to drive growth as well as shareholder value.
The company is also encouraged by continually strong demand at the Industrial segment, the ramp up of its new Latitude business jet, and the positive customer reaction to its new Longitude and Hemisphere jets that were announced during the National Business Aviation Association Exhibition last November.
The company currently carries a Zacks Rank #3 (Hold).
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