HON Honeywell International Inc

Honeywell International Inc. posted revenue and profit gains in its latest quarter but cut its revenue forecast for the year as the company saw core organic sales fall in its three business units.

Shares in the company, up 3.9% over the past three months, slid 1% to $117.50 in premarket trading.

Honeywell now expects annual sales of between $40 billion to $40.6 billion, down from its previous guidance for sales between $40.3 billion and $40.9 billion. It also increased the low end of its earnings-per-share guidance for the year by 5 cents, now expecting between $6.60 to $6.70.

Honeywell makes products ranging from air conditioners and commercial boilers to airplane-cockpit controls and industrial gloves. The company also is varied across geographies and generates about half of its revenue outside the U.S.

Last month, Honeywell said Chief Executive Dave Cote would step down in March after a 14-year tenure. Mr. Cote, who turns 64 next month, will be succeeded by Darius Adamczyk, who was named the company's president and chief operating officer in April. Mr. Cote will continue as executive chairman through April 2018, and then start a five-year consulting and noncompete agreement.

For the quarter, Honeywell reported a profit of $1.28 billion, or $1.66 a share, up from $1.19 billion, or $1.51 a share, a year prior.

Revenue grew 2.2% to $9.99 billion. Core organic sales fell overall by 2%.

Analysts polled by Thomson Reuters projected $1.64 in per-share profit on $10.13 billion in sales.

Honeywell also announced that its automation and control solutions segment would be split into two smaller units—home and building technologies, and safety and productivity solutions.

"Having two more nimble segments will promote greater customer intimacy and responsiveness," Mr. Cote said.

Home and building technologies, which had an estimated $9.4 billion in revenue in 2015, will include products that monitor and control homes and buildings, such as security, fire and air conditioning systems. It will be led by Terrence Hahn, who previously ran Honeywell's transportation systems unit.

Safety and productivity solutions, which had an estimated $4.7 billion in revenue in 2015, provides products for workers such as rugged mobile computers, bar-code scanners, gas sensing technologies and personal protection equipment. It will be lead by John Waldron, who had been the president of the sensing and productivity solutions business unit.

The CEO of the automation and control solutions segment, Alex Ismail, will leave the company. Honeywell will begin reporting under the new segments next quarter.

In its automation and control-systems business, Honeywell saw an acquisition-driven 9.4% jump in revenue to $3.89 billion. Core organic sales decreased 1% because of lower volume in sensing and solutions due to a large rollout last year, which was partially offset by growth in security and fire.

In its performance materials and technologies unit, sales fell 2.9% to $2.33 billion. Core organic sales declined 4%. Lower gas processing, licensing and equipment sales along with lower market pricing in resins and chemicals contributed to the decline.

Revenue in the company's aerospace segment fell 1.3% to $3.78 billion on higher repair and overhaul activities and new platform launches. Core organic sales dropped 2% on program delays in the international, U.S. and service businesses within defense and space, on lower shipments to business and general aviation customers and on higher incentives for original equipment manufacturers.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

July 22, 2016 08:15 ET (12:15 GMT)

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