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HARTFORD, Conn., April 17, 2008 -– United Technologies Corp. (NYSE:UTX) today reported first quarter 2008 earnings per share of $1.03 and net income of $1.0 billion, up 26 percent and 22 percent, respectively, over the year ago first quarter. Results for the current quarter include a $0.02 per share impact for restructuring costs. In 2007, results included a $0.07 per share impact for the Otis European Union Commission fine, net of related reserves, restructuring charges, and one-time favorable items. Excluding restructuring and other one-time items in both periods, earnings per share grew 18 percent year over year.
First quarter consolidated revenues increased 12 percent to $13.7 billion, including 7 percent organic growth. Foreign currency translation and acquisitions accounted for the remainder of the growth.
“We are pleased with this solid start to the year and confident the geographic and business balance of the UTC portfolio will continue to deliver superior performance. This quarter’s results are further evidence that our business model, with its focus on global growth through market leading franchises and cost reduction through the implementation of the ACE operating system, can deliver solid results even in a softening economic environment,” said Louis R. Chênevert, UTC President and Chief Executive Officer.
Although there were some early signs of moderating growth in the U.S. and several European countries, UTC’s commercial construction new equipment orders were generally up in the quarter. Consumer markets in the U.S. remain weak, impacting the residential businesses of both Carrier and UTC Fire & Security. Commercial aerospace markets remain solid. Backlog continued to expand in all six businesses reaching $60 billion at quarter end.
“We remain confident in the full year revenue and earnings guidance for each of our businesses and for UTC overall. Revenues are expected to grow to $59 billion with earnings per share in the range of $4.65 to $4.85, or 9 percent to 14 percent over the prior year. As we look to the back half of the year, we continue to adjust our operations in anticipation of the uncertain economic environment,” Chênevert added.
Cash flow from operations was $888 million and capital expenditures were $237 million for the quarter. Share repurchase totaled $801 million for the first three months of the year.
“Cash flow from operations less capital expenditures was below net income for the quarter. Inventories grew seasonally at Carrier and remain high in the aerospace businesses where backlogs continue to expand. We continue to expect cash flow from operations less capital expenditures to meet or exceed net income for the full year,” Chênevert continued.
The accompanying tables include information integral to assessing the company’s financial position, operating performance, and cash flow.
United Technologies Corp., based in Hartford, Connecticut, is a diversified company providing high technology products and services to the building and aerospace industries. Additional information, including a webcast, is available on the Internet at http://www.utc.com.
This release includes "forward-looking statements" concerning expected revenue, earnings and cash flow; anticipated benefits of UTC’s diversification and business model; and other matters. These matters are subject to risks and uncertainties. Important factors that could cause actual results to differ materially from those anticipated or implied in forward looking statements include the health of the global economy; strength of end market demand in building construction and in both the commercial and defense segments of the aerospace industry; fluctuation in commodity prices, interest rates, foreign currency exchange rates, and the impact of weather conditions; and company-specific factors including the availability and impact of acquisitions; the rate and ability to effectively integrate these acquired businesses; the ability to achieve cost reductions at planned levels; challenges in the design, development, production and support of advanced technologies and new products and services; delays and disruption in delivery of materials and services from suppliers; labor disputes; and the outcome of legal proceedings. The level of share repurchases may vary depending on the level of other investing activities. For information identifying other important economic, political, regulatory, legal, technological, competitive and other uncertainties, see UTC's SEC filings as submitted from time to time, including but not limited to, the information included in UTC's 10-K and 10-Q Reports under the headings "Business," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Cautionary Note Concerning Factors that May Affect Future Results," as well as the information included in UTC's Current Reports on Form 8-K.