Tue, Jul. 21, 7:52 AM
- Net profit of $1.54B, or $1.73 per share vs. $1.68B, or $1.84 a share, in the same period a year ago. Excluding one-time items and restructuring charges, adjusted earnings per share were $1.81.
- Sales by segment: Otis -8%; UTC Climate, Controls & Security +1%; Pratt & Whitney +2%; UTC Aerospace flat; Sikorsky -29%.
- Yesterday, UTC reached an agreement to sell Sikorsky to Lockheed Martin for $9B. Sikorsky will be reported in discontinued operations beginning in Q3.
- "With six months of trends behind us, it is now clear the commercial aftermarket at UTC Aerospace Systems will be significantly below our expectations for the year," said CEO Gregory Hayes. We now expect 2015 operating profit at UTC Aerospace Systems to be down $25M-$75M and at Otis to be down $25M-$75M at constant currency.
- Full year guidance: EPS from continuing operations of $6.15-$6.30 (including Sikorsky) vs. $6.35 to $6.55. Sales expectations from continuing operations have been revised to $57B-$58B from $58B-$59B.
- UTX -4.1% premarket
- Q2 results
Tue, Jul. 21, 7:07 AM
Mon, Jul. 20, 5:30 PM
Mon, Jul. 20, 12:49 PM
- Lockheed Martin (LMT +1.9%) hit a "trifecta" today following the announcement of its $9B purchase of Sikorsky Aircraft from United Technologies (UTX -0.7%), according to the analyst team at UBS.
- The deal cements LMT's dominance in weapons making and opens key foreign markets for the company, which has annual revenues of $45B; analysts do not expect antitrust objections since LMT does not build helicopters.
- LMT also announced a strategic review of a large portion of its government IT and services portfolio for a potential sale or spinoff.
- Also, LMT's Q2 results came in well ahead of consensus, with 3% revenue growth well ahead of the UBS forecast for a 6% decline and 12% margins coming in 30 bps better than expected.
- UTX shares also are worth buying, according to Sterne Agee CRT analyst Peter Arment, who says the Sikorsky sale is a "positive first step" in the transformation of its business portfolio and allows the company to return a large amount of cash to shareholders without reducing balance sheet flexibility; while Sikorsky generated ~10% of UTX sales, it only accounted for 6.5% of its profits.
Mon, Jul. 20, 7:54 AM
- Confirming previous reports, Lockheed Martin (NYSE:LMT) has agreed to buy United Technologies' (NYSE:UTX) Sikorsky unit for $9B, adding further heft to its $45B in annual revenues.
- Other players in the industry that were looking into an acquisition/merger, include Textron (NYSE:TXT), Boeing (NYSE:BA) and Airbus (OTCPK:EADSY).
- Lockheed's Q2 results are also scheduled to be released this morning.
- UTX +1.1% premarket
- Previously: Report: Lockheed to buy Sikorsky for over $8B (Jul. 20 2015)
Mon, Jul. 20, 1:42 AM
- Lockheed Martin (NYSE:LMT) has agreed to buy United Technologies' (NYSE:UTX) Sikorsky Aircraft for over $8B, Reuters reports, cementing a deal that would give the Black Hawk helicopter to the maker of the F-35 fighter jet.
- The acquisition of Sikorsky, which had more than 15K employees and net sales of $7.5B at the end of last year, would be the biggest by Lockheed since its $10B takeover of Martin Marietta two decades ago.
- Pentagon officials said last week they would carefully evaluate any sale to maintain competition and avoid market distortions.
Wed, Jul. 15, 12:14 PM
- United Technologies' (UTX -0.5%) Sikorsky Aircraft has been forced to delay the first flight of its largest helicopter until later this year while it completes testing fixes to its gearbox and other problems, the U.S. Navy said yesterday.
- Navy program officials say they have resolved gearbox problems that have contributed to delays in the new CH-53K King Stallion heavy-lift helicopter that was due to fly for the first time in June 2014, but additional testing is still required.
- The Marine Corps plans to buy 200 of the helicopters, a $25B program that accounts for half of Sikorsky’s existing commitments from the Pentagon; military helicopters generate ~70% of Sikorsky’s revenue, and the King Stallion contract is a key attraction for prospective buyers such as Lockheed Martin (LMT -0.2%) and Textron (TXT -1.2%).
Fri, Jul. 10, 3:04 PM
- Lockheed Martin (LMT +1.7%) is in advanced talks to buy the Sikorsky helicopter unit from United Technologies (UTX +1.3%), and an agreement could be reached in the coming days, Dow Jones reports.
- Earlier reports had said Textron (TXT +0.1%) also was a finalist in the bidding for the maker of Black Hawk helicopters.
- At a speculated price of $8B or more, a purchase of Sikorsky would be LMT’s largest since it bought Martin Marietta for ~$10B 20 years ago.
Wed, Jul. 8, 6:43 PM
- Lockheed Martin (NYSE:LMT) and Textron (NYSE:TXT) have emerged as final contenders to buy United Technologies' (NYSE:UTX) Sikorsky Aircraft unit, which could be valued at ~$8B, Reuters reports.
- UTX reportedly is weighing offers from the two companies and may come to a decision by the end of the month, but it still could decide against an outright sale and instead spin off Sikorsky to shareholders in a tax-free deal.
- TXT, whose ~$12B market cap is only one fifth the size of LMT's $60B, is said to have reached out to P-E firms to put together a cash bid.
- Boeing (NYSE:BA), which had expressed interest in a potential deal, is no longer active in the sale process, and Airbus (OTCPK:EADSF, OTCPK:EADSY) is not in the running, according to the report.
- UTX +1.5% AH.
Wed, Jun. 17, 8:04 AM
- Sikorsky Aircraft (NYSE:UTX), which is planning a spin-off or sale, has assured the U.S. Marine Corps that a change in its ownership will not derail its work on the CH-53K, a new heavy-lift helicopter the company is building for the Marines.
- Sikorsky expects the first flight of the newest helicopter before the end of the year, and possibly as early as late October or early November.
Tue, Jun. 16, 12:58 PM
- Airbus (OTCPK:EADSF, OTCPK:EADSY) is keeping an eye on United Technologies' (NYSE:UTX) plan to sell or spin off Sikorsky Aircraft, the president of the plane maker's helicopter unit says without committing to actually making a bid for the business.
- UTX’s decision to ditch Sikorsky comes as business demand for helicopters is under pressure as falling energy prices have led to cost cutting in the oil and gas sector - “The market is a difficult market as we speak,” Faury says.
- Airbus is not the only company possibly interested in Sikorsky, as UTX’s review of the business reportedly also has triggered interest from Boeing (NYSE:BA), Lockheed Martin (NYSE:LMT) and Textron (NYSE:TXT).
- Meanwhile, Faury says Airbus Helicopters is embarking on a two years study for a new heavy-lift helicopter that would emerge next decade.
Tue, Jun. 16, 10:45 AM
Mon, Jun. 15, 7:52 AM
- Many things will be achieved through a Sikorsky spin-off or sale, announced United Tech (NYSE:UTX) at the Paris Airshow, including higher organic growth, improved operating margin, better cash flow generation, increased aftermarket content and lower defense exposure.
- The company sees FY15 EPS (ex-Sikorsky) of $6.35-$6.55, organic sales growth of 3%-5% and free cash flow of 90%-100% of net income attributable to common shareholders.
- Previously: UTC establishes date for Sikorsky decision (Jun. 15 2015)
Mon, Jun. 15, 3:25 AM
- Putting a timeline on its helicopter exit, United Technologies (NYSE:UTX) has announced it will decide on spinning off or selling its Sikorsky Aircraft business by the end of the third quarter.
- "Separation of Sikorsky from the portfolio will allow both United Technologies and Sikorsky to better focus on their core businesses," said CEO Gregory Hayes.
- Previously: UTC reviewing Sikorsky options after offers (Jun. 10 2015)
Wed, Jun. 10, 2:16 PM
Wed, Jun. 10, 2:38 AM
- After receiving several offers, United Technologies' (NYSE:UTX) board of directors is scheduled to meet later this week to review the options for its $8B Sikorsky aircraft business.
- UTC is considering two tax-efficient transactions for Sikorsky: a spin-off or combination with peer Textron (NYSE:TXT).
- Alternatively, Sikorsky may be sold outright to another company. Lockheed Martin (NYSE:LMT), Boeing (NYSE:BA) and Airbus (OTCPK:EADSY) have all expressed interest.
UTX vs. ETF Alternatives
United Technologies Corporation provides high technology products and services to the building systems and aerospace industries. Its business segments are Otis, UTC Climate, Controls & Security, Pratt & Whitney, UTC Aerospace Systems and Sikorsky.
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