Jet-Engine Maker Struggles -- WSJ
25 Octubre 2017 - 2:02AM
Noticias Dow Jones
By Thomas Gryta and Cara Lombardo
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (October 25, 2017).
United Technologies Corp.'s profit fell as the conglomerate
battled production problems with a new jet engine and weak demand
for its Otis elevators in China.
The company said it booked a nearly $200 million charge in the
quarter ended Sept. 30 as it was forced to set aside more of its
latest Pratt & Whitney engines so they could be used to fix
existing planes rather than supply new ones for customers such as
Airbus SE.
New engines are generally sold at a loss, with service fees
bringing in profits in subsequent decades of use. The new geared
turbofan engine has allowed Pratt to better compete with General
Electric Co., but some initial durability issues slowed deliveries
and frustrated customers.
Those engine issues should be fixed by the end of the year, the
company said. Chief Financial Officer Akhil Johri said the "charge
takes care of an uncertain cloud that was hanging over us."
The Farmington, Conn., company shipped 120 new geared turbofan
engines last quarter, putting the year's total at 254, keeping it
on track for 350 to 400 deliveries this year, Mr. Johri said.
United Technologies said its third-quarter sales rose 5% to
$15.06 billion, while net income dropped 10% to $1.33 billion.
Otis continued to struggle in China. Unit orders in the country
rose 8% but were flat in dollar terms. Prices are dropping, Mr.
Johri said, and customers are opting for elevators with fewer
features.
Price drops have traditionally been offset by obtaining cost
cuts from suppliers, but that is becoming harder to do because of
commodity prices. "Suppliers are pushing back more," Mr. Johri
said, so United Technologies may have to charge its own customers
more.
The company said there is overcapacity in China but that Otis
should still have flat or increased earnings next year. United
Technologies earlier this month named Siemens USA CEO Judy Marks to
run the Otis division.
Last month, United Technologies reached a deal to buy
airplane-parts maker Rockwell Collins for $23 billion, in the
biggest aerospace deal in history.
Sales in United Technologies' aerospace segment, which stands to
benefit from a tie-up with Rockwell, declined slightly.
The company now expects adjusted per-share earnings of $6.58 to
$6.63 for the year, up from $6.45 to $6.60. It also narrowed its
revenue outlook to $59 billion to $59.5 billion, from $58.5 billion
to $59.5 billion.
Write to Thomas Gryta at thomas.gryta@wsj.com and Cara Lombardo
at cara.lombardo@wsj.com
(END) Dow Jones Newswires
October 25, 2017 02:47 ET (06:47 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
United Technologies (NYSE:UTX)
Gráfica de Acción Histórica
De Jul 2024 a Ago 2024
United Technologies (NYSE:UTX)
Gráfica de Acción Histórica
De Ago 2023 a Ago 2024