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October 17, 2012

Textron earnings rise less than expected; Bell revenues up 20 percent

Textron Inc., parent of Fort Worth-based Bell Helicopter, reported a weaker-than-expected 6.3 percent rise in third-quarter profit, citing weak demand for corporate jets and declines in sales to the military.

Textron said third-quarter net income came to $151 million, or 51 cents per share, compared with $142 million, or 47 cents per share, a year earlier, according to the British news agency Reuters.

Factoring out income from discontinued operations, the profit was 48 cents per share, below analysts' estimates of 51 cents.

The company's Bell division, which includes some other operations besides Bell Helicopter, reported strong gains in revenue and profits although its profit margin was slightly lower.

Revenues for the Bell division gained 20 percent in the quarter to $1.08 billion, while operating profit increased 15 percent to $165 million.

Textron's Cessna division, the world's largest maker of light business jets, faced "very quiet" ordering activity at its Cessna jet unit in July and August and was unable to make money in the quarter on a new contract to provide drones to the U.S. military, Chief Executive Officer Scott Donnelly told investors on a conference call.

"Order activity was very, very light in July and August," Donnelly said. "We did see it coming back in September."

Orders will need to hold near September's rate for the rest of the year for Cessna to meet Textron's full-year sales expectations, he added.

Textron raised its full-year earnings-per-share target on Wednesday, but the revised range of $1.95 to $2.05 was below the analysts' average estimate of $2.10, according to Thomson Reuters I/B/E/S. The company's previous forecast ranged from $1.80 to $2.00.

- Bob Cox

 

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