The company reported full-year 2011 results including:
• 2011 sales of $36.5 billion, up approximately 13% over 2010
   – 8% organic sales growth, again reflecting strong end markets, successful new product launches, and continued expansion in high growth regions
• 2011 proforma earnings (excluding the impact of pension mark-to-market adjustments)  of $4.05 per share, up 35% over $3.00 in 2010; Reported EPS of $2.61 in 2011 versus $2.59 in the prior year
   – Pension mark-to-market adjustment of $1.44 per share calculated using 791.6 million weighted average shares outstanding assuming dilution
• 2011 cash flow from operations of $2.8 billion, includes $1.7 billion cash pension contribution in the year
   – 2011 free cash flow of approximately $3.7 billion, prior to $1.7 billion cash pension contribution

“Honeywell had a terrific 2011,” said Honeywell Chairman and CEO Dave Cote. “We executed across the portfolio with record organic sales growth and segment margins. Our 2011 performance reflects the operational and financial disciplines that underpin the transformation that has taken place at the company over the last 10 years. We deployed the Honeywell 5 Initiatives – Growth, Productivity, Cash, People, and our Enablers, and created a common One Honeywell culture committed to continuous improvement. As a result, we built a better set of businesses with Great Positions in Good Industries, a terrific performance track record, a great leadership team with a truly global focus, a very full pipeline of new products and technologies, and our key process initiatives that are gaining momentum. We’ve come a long way, and we feel even better about our future.”

“While we expect a more challenging macro environment ahead in 2012, primarily driven by softness in Europe impacting the short-cycle businesses, we’re confident that Honeywell is well positioned to continue to outperform,” continued Cote.  “Our long-cycle businesses are accelerating, with Commercial Aerospace OE, UOP, Building Solutions & Distribution, and Process Solutions all having substantial backlog, in total just under $16 billion. While we expect growth to moderate in the first half of 2012, we’re confident that we can drive strong sales conversion leading to higher segment margins over the course of the year.  The investments we’ve made, coupled with our execution track record and disciplined playbook, will be key to our continued outperformance in 2012 and beyond.”

For more information, read the press release or listen to a replay of the Investor Conference Call.

Pictured left to right: Shane Tedjarati, President, High Growth Regions, and  Stephen Shang, President, Honeywell China

Honeywell announced that Shane Tedjarati was named to the broader role of President, High Growth Regions, and Stephen Shang will take over as President, Honeywell China, effective immediately. Tedjarati will continue to report directly to Honeywell Chairman and CEO Dave Cote. Shang will report to Tedjarati.

“Globalization has been a key pillar of our Growth Initiative for the past decade,” said Dave Cote, Honeywell Chairman and CEO.  “Ten years ago, less than 40% of our sales were generated outside the U.S.  Today, our company is twice the size, and approximately 55% of our revenues are generated outside the U.S.  We began executing this strategy by focusing on the two most important emerging markets – China and India.  That strategy has proven to be a good one.  We have grown nearly ten-fold in revenues and now have nearly 25,000 employees in China and India, representing a significant share of our global growth story.” 

For biographical and additional information, read the press release.

Honeywell announced its 2012 financial outlook including:

 • Sales of $37.8-38.9 billion, up 4-7% over 2011 estimated sales
        – 4-6% organic growth expected
  • Earnings per share (EPS) of $4.25-4.50, an increase of 6-12% over prior year
        – Strong sales conversion drives 40-70 basis points margin expansion
        – Proforma EPS from continuing operations up 13-19%
        – Mark-to-market pension adjustments in both periods excluded
  • Free cash flow (cash flow from operations less capital expenditures) of approximately $3.5 billion
       – Free cash flow conversion of approximately 100%
       – 2012 free cash flow guidance excludes any cash pension contributions

The company also reaffirmed its 2011 full-year guidance, expecting:
  • Sales of approximately $36.5 billion, up 13% over 2010
       – Excludes the divested CPG business, treated as discontinued operations
  • Proforma earnings per share of approximately $4.03, up 34% over 2010
       – Mark-to-market pension adjustments in both periods excluded
  • Free cash flow guidance of approximately $3.5 billion, excluding cash pension contributions

“Honeywell’s 2011 performance significantly adds to our performance track record and highlights the strength of our portfolio, robust new product pipeline, and expansion in high-growth regions,” said Honeywell Chairman and Chief Executive Officer Dave Cote.  “Our long-cycle backlog continues at record levels, with sustained strong orders growth particularly at UOP, Process and Building Solutions, and Commercial Aerospace. Further, our short-cycle businesses, such as Turbo Technologies, Advanced Materials, and ACS products performed well throughout 2011.”

“We’re planning for a more challenging macro environment in 2012,” continued Cote.  “While key economic indicators show slower year-over-year growth in GDP and industrial production globally, we expect to grow faster than the end markets we serve, mainly driven by our robust long-cycle backlog of almost $16 billion, strong commercial aerospace aftermarket growth, and continued contributions from our short-cycle businesses. We feel confident that our portfolio mix and continued margin expansion will deliver strong earnings growth and free cash flow conversion in 2012.”

For more information, listen to a replay of the Investor Conference call.

Honeywell Chairman and CEO Dave Cote received the Distinguished Service Award from the Tax Foundation at its 74th Annual Dinner held in Washington, D.C.

The Tax Foundation is a nonpartisan research organization that has monitored fiscal policy at the federal, state, and local levels since 1937. Since 1941, the Tax Foundation has awarded the Distinguished Service Award to a wide range of tax professionals, elected officials, and business leaders, including Senate Finance Committee Chairman Max Baucus (D-MT), House Ways and Means Committee Chairman Bill Thomas (R-CA), Treasury Secretary James A. Baker III, Federal Reserve Chairman Paul Volcker, and President Dwight D. Eisenhower.

Cote, a member of President Obama’s National Commission on Fiscal Responsibility and Reform, has been an advocate of an American Competitiveness agenda that would alleviate the national deficit and create jobs.

“It’s important for all of us to let our politicians know that we want to compete, that we still know how, and that we just need the tools to do it,” said Cote. “By addressing debt and taxes, energy policy, math and science education, infrastructure, free trade, and tort reform we can have the tools we need to create a dynamic, fair economic environment where our country and our people can continue winning.  It’s a question of do we still have the political will to do the hard things required in life?  We can do it.  We need government to work together and enable it.  We just need the tools.”

Read more about the award.

“The strength of our business performance year-to-date and our expectations for continued good organic sales growth, EPS expansion, and cash flow generation led to the decision to increase the dividend rate by 12%, compared to the historical 10% increase, and accelerate the effective date to the fourth quarter of this year,” said Honeywell Chairman and CEO Dave Cote. “Our strategies for smart cash deployment, including reinvestment in our businesses, disciplined M&A, dividend growth, and opportunistic share repurchases, will continue to be drivers of shareowner value.”

Honeywell Chairman and CEO Dave Cote discussed the need for an American Competitiveness agenda that would help the U.S. deficit and job market outlook on ‘Nightly Business Report’ on PBS News.

Cote, a member of President Obama’s National Commission on Fiscal Responsibility and Reform, said that there are six points to an American Competitiveness agenda that would alleviate the national deficit and create jobs.

“The first is resolving our long-term debt problem,” said Cote. “The second is actually having an energy policy. The third is math and science education. The fourth is infrastructure. The fifth is free trade and a more comprehensive nuanced relationship with China. Then the sixth is tort reform. And these are all meaty issues to address with the biggest, most imminent one being debt.”

For more information, read the full transcript from the interview or a recent speech by Cote on an American Competitiveness agenda.

• 3Q11 sales were up 14% to $9.3 billion versus $8.1 billion in 3Q10
    – 8% organic growth reflects continued strength in end markets
• 3Q11 earnings of $1.10 per share, an increase of 45% over $0.76 in 3Q10
    – Segment profit growth and margin expansion in all segments
    – Includes $0.04 benefit from lower tax rate; tax rate favorability expected to be offset in 4Q11
    – Includes $0.33 repositioning and other actions funded by the gain on sale of the divested Consumer Products Group (CPG) business ($0.23, discontinued operations) and OPEB curtailment ($0.10) in the quarter, which will better position the company for 2012 and beyond
• 3Q11 cash flow from operations of $0.7 billion, includes $400 million cash pension contribution
    – 3Q11 free cash flow (cash flow from operations less capital expenditures) of $884 million, excludes $400 million cash pension contribution

The company is raising its 2011 sales and EPS outlook and now expects:
• 2011 sales of $36.5 – 36.7 billion, up approximately 13% over 2010
    – Excludes the divested CPG business, treated as discontinued operations
• 2011 proforma earnings per share of $4.00 – 4.05, up 33 – 35% over 2010
    – Mark-to-market pension adjustments in both periods excluded
• 2011 free cash flow guidance of approximately $3.5 billion, prior to any cash pension contribution

“Honeywell’s strong third quarter results are a continuation of the momentum we’ve seen across our businesses in 2011,” said Honeywell Chairman and CEO Dave Cote.  “Our third quarter sales growth reflects a particularly robust Commercial Aerospace upcycle, with growth in both original equipment and aftermarket sales. It also highlights the company’s extensive innovation pipeline and increasing presence in high growth regions in all our businesses. Our long-cycle backlog continues at near record levels, with sustained strong orders growth particularly at UOP, ACS Solutions, and Commercial Aerospace. Further, our short-cycle businesses, such as Turbo Technologies, Advanced Materials, and ACS Products are performing well overall.” 

“Despite signals of slower economic growth, we expect positive organic growth to continue the rest of this year and into 2012,” concluded Cote. “The repositioning actions we took in the third quarter, funded by non-operational gains, better position our businesses for 2012 and beyond. These repositioning tailwinds, combined with our great positions in good industries, execution track record, and disciplined playbook, will be keys to our continued outperformance.”

For more information, read the press release, watch Chairman and CEO Dave Cote discuss the company’s financial performance on CNBC, or listen to a replay of the Investor Conference Call.

Honeywell Chairman and CEO Dave Cote discussed the U.S. debt/deficit issues on Fox Business Network’s ‘Countdown to the Closing Bell’ and CNN International’s ‘World Business Today.’

Cote, a member of President Obama’s National Commission on Fiscal Responsibility and Reform, said that businesses are watching the debate very closely.

“Everybody’s pretty much shocked right now because no one ever expected it would get this far,” said Cote.

During the interviews, Cote said the government needs at least $4 trillion to get the U.S. on the right path.

“Just endorse the Simpson-Bowles proposal,” Cote told CNN International correspondent Maggie Lake.  “We need at least $4 trillion dollars here … Even at $4 trillion – one of my learnings from being on the Commission – was that there is a good chance we’ll have to do this again in three or four years … $4 trillion just starts us on the right path.”

For more information, watch the CNN International interview and the Fox Business interview.

Honeywell announced second quarter 2011 sales of $9.1 billion, up 15% versus $7.9 billion in the second quarter of 2010, excluding $234 million from its discontinued Consumer Products Group (CPG) operations in 2011 and $235 million in 2010.  Earnings per share were up 40% in the second quarter to $1.02 versus $0.73 in the second quarter last year, which reflects income from discontinued operations of $0.02 in both the second quarter of 2011 and 2010.  Cash flow from operations was $1,138 million and free cash flow (cash flow from operations less capital expenditures) was $973 million, compared to $1,090 million and $975 million, respectively, in the second quarter last year.  Honeywell has received all necessary regulatory approvals for the previously announced sale of CPG, which is expected to close in the third quarter. 

The table below shows a reconciliation of continuing and discontinued operations. 

“Honeywell’s strong second quarter performance reflects terrific execution and continued momentum in our key end markets, contributing to our upside performance in the first half of 2011,” said Honeywell Chairman and CEO Dave Cote.  “The sales growth we’re seeing reflects our extensive innovation pipeline and increasing presence in high growth regions. We had particularly robust growth in the Aerospace commercial aftermarket, and our short-cycle businesses such as Advanced Materials, ACS Products, and Turbo Technologies continued to perform well.”

“We expect good organic growth to continue in the second half of 2011,” continued Cote. “Favorable global macro trends like safety, security, energy, and globalization combined with our continued investments in new technologies, high growth regions, and our process initiatives will enable the company to continue to grow and outperform now and over the long-term.”

Honeywell now expects 2011 sales of $36.1-36.7 billion, an increase of 12-14% over 2010, which excludes CPG sales now reported in discontinued operations in both periods; and earnings in the range of $3.85-4.00 per share (including discontinued operations) versus a previous estimate of $3.80-3.95 per share, an increase of 28-33% over 2010 proforma EPS of $3.00 (in each case, this excludes any mark-to-market pension adjustments). 2010 reported earnings were $2.59 per share. The company also reaffirmed that it expects free cash flow of $3.5-3.7 billion, excluding any U.S. pension contributions in 2011 (cash flow from operations of $3.3-3.5 billion including $1 billion of pension contributions made to date).

For more information, read the press release or listen to a replay of a Webcast of the Investor Conference Call.

Honeywell Chairman and CEO Dave Cote discussed the global economy, jobs, corporate taxes, and the U.S. debt ceiling on NBC’s “Meet the Press” with David Gregory.

During the segment, Cote said the U.S. government needs to find an economic solution that does more than the current solutions being proposed.

“The world has changed.  We went from a billion participants in the global economy to four billion over the last 20 years. Yet, we still act like we did 20 years ago,” said Cote.  “We need an American competitiveness agenda that gets our finances right, and gets our energy policy, our math and science education, and infrastructure right.”

For more information, watch the full interview.