Summary
Honeywell International Inc. (HON) filed an 8-K on January 29, 2010, to disclose important information regarding their first quarter 2010 guidance. The company clarified that their previously provided guidance for first quarter 2010 sales and earnings per share (EPS) included specific planning assumptions related to potential impacts from proposed healthcare legislation. The key clarification centers on a potential negative $0.04 to $0.05 per share impact on EPS. This impact is attributed to a provision within the proposed legislation that would repeal federal tax deductions for certain employee medical benefits, necessitating a reversal of a deferred tax asset and resulting in a one-time expense in the quarter of enactment. Honeywell emphasized that there are no assurances regarding the enactment of this legislation in its current form or its timing.
Key Highlights
- 1Honeywell provided an update on its first quarter 2010 guidance via an investor conference call and webcast.
- 2The company clarified its previously issued guidance for Q1 2010 sales and EPS.
- 3A key planning assumption for Q1 2010 EPS guidance included a potential negative impact of $0.04-$0.05 per share.
- 4This estimated EPS impact is related to proposed healthcare legislation.
- 5The legislation, if enacted, could repeal federal tax deductions for certain employee medical benefits.
- 6This repeal would trigger a reversal of a deferred tax asset and a one-time expense.
- 7Honeywell noted uncertainty regarding the enactment and timing of the proposed healthcare legislation.