United Technologies Profit Rises 22%
Diversified manufacturer United Technologiesreported profit that topped Wall Street's expectations Thursday but its shares fell in early trading after the company held its full-year outlook steady and warned of a slowing economy.
The company attributed the 22 percent rise in first-quarter profit to strong demand for aviation equipment, as well as elevators and air conditioners used in commercial buildings.
But it noted "early signs" of slowing growth in the United States and Europe.
"As we look to the back half of the year, we continue to adjust our operations in anticipation of the uncertain economic environment," Louis Chenevert, who last week succeeded George David as CEO.
Last week fellow blue-chip industrial General Electric cut its 2008 profit outlook, citing weakness in its financial services business.
United Tech, which makes products ranging from Otis elevators to Black Hawk military helicopters, reported first-quarter profit of $1 billion, or $1.03 per share, compared with $819 million, or 82 cents a share, a year earlier.
Factoring out 2 cents per share of restructuring charges, profit was $1.05 per share. On that basis, Wall Street had expected, on average, $1.01 per share, according to Reuters Estimates.
Revenue rose 11.6 percent to $13.7 billion.
"UTX pumped out another very solid quarter," Nigel Coe, analyst at Deutsche Bank, wrote in a note to clients, referring to the company by its stock symbol. "The outlook remains cautious."
The Hartford, Conn.-based company confirmed its full-year profit forecast of $4.65 to $4.85 per share.
United Tech, which also produces jet engines, has benefited from strong nonresidential building activity, particularly in emerging markets. It generates about 60 percent of its sales outside the United States.
United Tech shares eased 1 percent to $71.60 in premarket trading, down from a Wednesday close at $72.63 on the New York Stock Exchange. As of the Wednesday close, the shares were down 5 percent this year, roughly in line with the Dow Jones industrial average, of which it is a component.
United Tech in March made a $2.64 billion offer to acquire Diebold , the world's No. 2 maker of automated teller machines. The bid was rejected.
United Tech has since disclosed that it has taken a 3.5 percent stake in Diebold, and indicated that it was interested in buying more shares.