Textron Inc. (NYSE: TXT) today reported first quarter 2016
income from continuing operations of $0.55 per share, up 19.6
percent from $0.46 per share in the first quarter of 2015.
Revenues in the quarter were $3.2 billion, up 4.2 percent from
the first quarter of 2015. Textron segment profit in the quarter
was $280 million, up $21 million from the first quarter of 2015.
First quarter manufacturing cash flow before pension contributions
reflected a use of cash of $222 million compared to a use of cash
of $125 million during last year’s first quarter.
“Increased revenues reflected growth at Industrial, Aviation and
Systems, with relatively flat revenues at Bell, consistent with our
expectations,” said Textron Chairman and CEO Scott C. Donnelly.
“Operationally, we achieved margin improvements at each of our
manufacturing segments.”
Outlook
Textron confirmed its 2016 earnings per share from continuing
operations guidance of $2.60 to $2.80 and its expectation for cash
flow from continuing operations of the manufacturing group before
pension contributions of $600 to $700 million with planned pension
contributions of about $60 million.
Donnelly continued, “Generally, demand in our end markets has
been consistent with what we were expecting. We continue to believe
that we will be able to generate solid overall growth in revenue,
earnings and cash this year.”
First Quarter Segment Results
Textron Aviation
Revenues at Textron Aviation were up $40 million, primarily due
to higher jet volume.
Textron Aviation delivered 34 new jets and 26 King Air
turboprops in the quarter, compared to 33 jets and 25 King Airs in
last year’s first quarter.
Textron Aviation recorded a segment profit of $73 million in the
first quarter compared to $67 million a year ago.
Textron Aviation backlog at the end of the first quarter was
$1.0 billion, down $47 million from the end of the fourth
quarter.
Bell
Bell revenues were up $1 million, as Bell delivered 6 V-22’s in
the quarter, flat with last year’s first quarter, 10 H-1’s compared
to 4 H-1’s last year and 30 commercial helicopters, compared to 35
units last year.
Segment profit was up $6 million, primarily due to improved
performance.
Bell backlog at the end of the first quarter was $5.3 billion,
up $60 million from the end of the fourth quarter.
Textron Systems
Revenues at Textron Systems increased $9 million, primarily due
to higher volume in the Unmanned Systems product line, while
segment profit was up $1 million.
Textron Systems’ backlog at the end of the first quarter was
$2.5 billion, up $196 million from the end of the fourth
quarter.
Industrial
Industrial revenues increased $80 million due to higher volumes
and the impact of acquisitions.
Segment profit increased $9 million reflecting the higher
volumes.
Finance
Finance segment revenues decreased $2 million and segment profit
decreased $1 million.
Conference Call Information
Textron will host its conference call today, April 20, 2016 at
8:00 a.m. (Eastern) to discuss its results and outlook. The call
will be available via webcast at www.textron.com or by direct dial
at (800) 288-8960 in the U.S. or (651) 291-0344 outside of the U.S.
(request the Textron Earnings Call).
In addition, the call will be recorded and available for
playback beginning at 10:30 a.m. (Eastern) on Wednesday, April 20,
2016 by dialing (320) 365-3844 ; Access Code: 373338.
A package containing key data that will be covered on today’s
call can be found in the Investor Relations section of the
company’s website at www.textron.com.
About Textron Inc.
Textron Inc. is a multi-industry company that leverages its
global network of aircraft, defense, industrial and finance
businesses to provide customers with innovative solutions and
services. Textron is known around the world for its powerful brands
such as Bell Helicopter, Cessna, Beechcraft, Hawker, Jacobsen,
Kautex, Lycoming, E-Z-GO, Greenlee, Textron Systems, and TRU
Simulation + Training. For more information visit:
www.textron.com.
Non-GAAP Measures
Manufacturing cash flow before pension contributions is a
non-GAAP measure that is defined and reconciled to GAAP in an
attachment to this release.
Forward-looking Information
Certain statements in this release and other oral and written
statements made by us from time to time are “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements, which may
describe strategies, goals, outlook or other non-historical
matters, or project revenues, income, returns or other financial
measures, often include words such as “believe,” “expect,”
“anticipate,” “intend,” “plan,” “estimate,” “guidance,” “project,”
“target,” “potential,” “will,” “should,” “could,” “likely” or “may”
and similar expressions intended to identify forward-looking
statements. These statements are only predictions and involve known
and unknown risks, uncertainties, and other factors that may cause
our actual results to differ materially from those expressed or
implied by such forward-looking statements. Given these
uncertainties, you should not place undue reliance on these
forward-looking statements. Forward-looking statements speak only
as of the date on which they are made, and we undertake no
obligation to update or revise any forward-looking statements. In
addition to those factors described in our Annual Report on Form
10-K and our Quarterly Reports on Form 10-Q under “Risk Factors”,
among the factors that could cause actual results to differ
materially from past and projected future results are the
following: Interruptions in the U.S. Government’s ability to fund
its activities and/or pay its obligations; changing priorities or
reductions in the U.S. Government defense budget, including those
related to military operations in foreign countries; our ability to
perform as anticipated and to control costs under contracts with
the U.S. Government; the U.S. Government’s ability to unilaterally
modify or terminate its contracts with us for the U.S. Government’s
convenience or for our failure to perform, to change applicable
procurement and accounting policies, or, under certain
circumstances, to withhold payment or suspend or debar us as a
contractor eligible to receive future contract awards; changes in
foreign military funding priorities or budget constraints and
determinations, or changes in government regulations or policies on
the export and import of military and commercial products;
volatility in the global economy or changes in worldwide political
conditions that adversely impact demand for our products;
volatility in interest rates or foreign exchange rates; risks
related to our international business, including establishing and
maintaining facilities in locations around the world and relying on
joint venture partners, subcontractors, suppliers, representatives,
consultants and other business partners in connection with
international business, including in emerging market countries; our
Finance segment’s ability to maintain portfolio credit quality or
to realize full value of receivables; performance issues with key
suppliers or subcontractors; legislative or regulatory actions,
both domestic and foreign, impacting our operations or demand for
our products; our ability to control costs and successfully
implement various cost-reduction activities; the efficacy of
research and development investments to develop new products or
unanticipated expenses in connection with the launching of
significant new products or programs; the timing of our new product
launches or certifications of our new aircraft products; our
ability to keep pace with our competitors in the introduction of
new products and upgrades with features and technologies desired by
our customers; pension plan assumptions and future contributions;
demand softness or volatility in the markets in which we do
business; and cybersecurity threats, including the potential
misappropriation of assets or sensitive information, corruption of
data or operational disruption.
TEXTRON INC.
Revenues by Segment and Reconciliation
of Segment Profit to Net Income
Three Months Ended April 2, 2016 and
April 4, 2015
(Dollars in millions, except per share
amounts)
(Unaudited)
Three Months Ended April 2, 2016
April 4, 2015
REVENUES
MANUFACTURING: Textron Aviation $ 1,091 $ 1,051 Bell 814 813
Textron Systems 324 315 Industrial 952 872
3,181 3,051 FINANCE 20 22
Total revenues $ 3,201 $
3,073
SEGMENT
PROFIT
MANUFACTURING: Textron Aviation $ 73 $ 67 Bell 82 76 Textron
Systems 29 28 Industrial 91 82 275 253
FINANCE 5 6
Segment
Profit 280 259 Corporate expenses and
other, net (32 ) (42 ) Interest expense, net for Manufacturing
group (33 ) (33 ) Income from continuing
operations before income taxes 215 184 Income tax expense
(64 ) (56 )
Income from continuing operations
151 128 Discontinued operations, net of income taxes
(1 ) -
Net income $ 150
$ 128 Earnings per share:
Income from continuing operations $ 0.55
$ 0.46 Discontinued operations, net of income taxes
- -
Net income $
0.55 $ 0.46 Diluted
average shares outstanding 273,022,000
280,077,000
Textron Inc.Condensed
Consolidated Balance Sheets(In millions)(Unaudited)
April 2, 2016
January 2, 2016 Assets Cash and equivalents $
723 $ 946 Accounts receivable, net 1,209 1,047 Inventories 4,477
4,144 Other current assets 328 341 Net property, plant and
equipment 2,560 2,492 Goodwill 2,114 2,023 Other assets 2,397 2,399
Finance group assets 1,291 1,316 Total Assets
$ 15,099 $ 14,708
Liabilities and
Shareholders' Equity Short-term debt and current portion of
long-term debt $ 309 $ 262 Other current liabilities 3,568 3,530
Other liabilities 2,320 2,376 Long-term debt 2,800 2,435 Finance
group liabilities 1,113 1,141 Total
Liabilities 10,110 9,744 Total Shareholders' Equity
4,989 4,964 Total Liabilities and Shareholders'
Equity $ 15,099 $ 14,708
TEXTRON INC.MANUFACTURING GROUPCondensed Schedule
of Cash Flows and Manufacturing Cash Flow GAAP to Non-GAAP
ReconciliationsThree Months Ended April 2, 2016 and April 4,
2015(In millions)(Unaudited)
Three Months Ended April 2,2016
April 4,2015 Cash flows from operating
activities: Income from continuing operations $ 148 $ 124
Depreciation and amortization 106 108 Changes in working capital
(390 ) (305 ) Changes in other assets and liabilities and non-cash
items (12 ) 6 Net cash from operating
activities of continuing operations (148 ) (67
)
Cash flows from investing activities: Net cash used in
acquisitions (164 ) (32 ) Capital expenditures (88 ) (79 ) Proceeds
from the sale of property, plant and equipment 2 1 Other investing
activities, net (2 ) (7 ) Net cash from
investing activities (252 ) (117 )
Cash
flows from financing activities: Proceeds from long-term debt
345 - Increase in short-term debt 42 25 Purchases of Textron common
stock (215 ) - Other financing activities, net 1
(4 ) Net cash from financing activities 173
21 Total cash flows from continuing
operations (227 ) (163 ) Total cash flows from discontinued
operations - (2 ) Effect of exchange rate changes on cash and
equivalents 4 (5 )
Net change in
cash and equivalents (223 ) (170 ) Cash and equivalents at
beginning of period 946 731 Cash
and equivalents at end of period $ 723 $ 561
Manufacturing Cash Flow GAAP to Non-GAAP
Reconciliations: Net cash from operating
activities of continuing operations - GAAP $ (148 ) $ (67 ) Less:
Capital expenditures (88 ) (79 ) Plus: Total pension contributions
12 20 Proceeds from the sale of property, plant and equipment
2 1 Manufacturing cash flow
before pension contributions- Non-GAAP $ (222 ) $ (125 )
2016 Outlook Net cash from operating
activities of continuing operations - GAAP
$ 1,015 - $ 1,115
Less: Capital expenditures
(475)
Plus: Total pension contributions
60
Manufacturing cash flow before pension contributions- Non-GAAP
$ 600 - $ 700
Free cash flow is a measure generally used by investors,
analysts and management to gauge a company’s ability to generate
cash from operations in excess of that necessary to be reinvested
to sustain and grow the business and fund its obligations. Our
definition of Manufacturing free cash flow adjusts net cash from
operating activities of continuing operations for dividends
received from TFC, capital contributions provided under the Support
Agreement and debt agreements, capital expenditures, proceeds from
the sale of property, plant and equipment and contributions to our
pension plans. We believe that our calculation provides a relevant
measure of liquidity and is a useful basis for assessing our
ability to fund operations and obligations. This measure is not a
financial measure under GAAP and should be used in conjunction with
GAAP cash measures provided in our Consolidated Statements of Cash
Flows.
TEXTRON INC.Condensed Consolidated
Schedule of Cash FlowsThree Months Ended April 2, 2016 and
April 4, 2015(In millions)(Unaudited)
Three Months Ended April 2,2016
April 4,2015 Cash flows from operating
activities: Income from continuing operations $ 151 $ 128
Depreciation and amortization 109 110 Changes in working capital
(400 ) (269 ) Changes in other assets and liabilities and non-cash
items (10 ) 12 Net cash from operating
activities of continuing operations (150 ) (19
)
Cash flows from investing activities: Net cash used in
acquisitions (164 ) (32 ) Capital expenditures (88 ) (79 ) Finance
receivables repaid 17 31 Other investing activities, net 10
23 Net cash from investing activities
(225 ) (57 )
Cash flows from financing
activities: Proceeds from long-term debt 362 9 Increase in
short-term debt 42 25 Principal payments on long-term debt and
nonrecourse debt (46 ) (70 ) Purchases of Textron common stock (215
) - Other financing activities, net 1 5
Net cash from financing activities 144
(31 ) Total cash flows from continuing operations (231 )
(107 ) Total cash flows from discontinued operations - (2 ) Effect
of exchange rate changes on cash and equivalents 4
(5 )
Net change in cash and equivalents (227 )
(114 ) Cash and equivalents at beginning of period
1,005 822 Cash and equivalents at end
of period $ 778 $ 708
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160420005164/en/
Textron Inc.Investor Contacts:Douglas Wilburne,
401-457-2288orD’Ante Natili, 401-457-2288orMedia
Contact:David Sylvestre, 401-457-2362
Textron (NYSE:TXT)
Historical Stock Chart
From Mar 2024 to Apr 2024
Textron (NYSE:TXT)
Historical Stock Chart
From Apr 2023 to Apr 2024