Honeywell International Inc.(NYSE:HON ) revenue remained flat in the Q1 of 2015 and has lower its revenue growth outlook for the full year of 2015 due to headwinds caused by strong U.S dollar which negatively affected foreign sales.
Honeywell said in a statement that full year sales results will come in between $39 billion to $39.6 billion this year. Chief Executive Officer Dave Cote said efficiency and gains in value of market-share would cancel the affect ofderailing revenue.
The strengthened U.S dollar value affects the demand of Honeywell products abroad, which contributes 40 percent of the total sales, when converted into U.S currency. According to company the fall in crude oil prices cut down prices of Honeywell’s resins and chemicals. Honeywell’s first quarter revenue fell 4.8 percent to $9.2 billion.
“The macro environment in the first quarter wasn’t easy with headwinds from extreme weather, port shutdowns, declining oil & gas investments and a strengthening U.S. dollar,” Cote said on a conference call with analysts.
The shares of the firm declined 2.1 percent to $101.70 on the closing of New York stock market, the largest slump since Jan. 30. The company’s shares jumped 1.8 percent in the current year although risen 1.1 percent on the Standard & Poor’s 500 Index.
Honeywell said, “Conservative cost planning” helped drive the increase in the full-year outlook. The company said in March it has funded $315 million for restructuring projects this year on designed to reduce costs.
Excluding pension expenses, Honeywell reported adjusted net income of $1.41 a share, up from $1.28 a year ago, surpassing the mean forecast of $1.39. Net income leaped almost 10 percent to $1.12 billion.
Honeywell said sales climbed 2 percent, excluding the effects of the currency, divestitures and lower prices for resins and chemicals. Operating earnings dropped 48 percent to $256 million in the first quarter, excluding capital expenditures, due to incentive payments at its aerospace sector.
The company’s largest unit, Automation and Control Solutions, saw a decline of 2.9 percent in its sales. In Aerospace sector sales were down 6.3 percent. The Performance Materials and Technologies unit specified in making resins and chemicals also showed a 5% decline in its sales.
