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Honeywell International 8-K Report, Financial Results (Apr 25, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed April 25, 2024
Period End
April 25, 2024
Security
HON
In the record · 2016–202610-K1110-Q348-K196

HON filed 11 annual reports (10-K), 34 quarterly reports (10-Q) and 196 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Feb ’18Feb ’18
  2. Material agreement8-K · Apr ’20Apr ’20
  3. Leadership change8-K · Oct ’22Oct ’22
  4. Leadership change8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed April 25, 2024. Cited figures are marked; the original filing is the authoritative source.

Honeywell's first-quarter 2024 results (reported April 25, 2024) met or exceeded company guidance, with sales of $9.1 billiona, up 3% both reported and organically.

Operating margin expanded 130 basis points to 20.4%, and segment margin rose 20 basis points to 22.2%, driven primarily by Aerospace Technologies. GAAP diluted EPS was $2.23b (up 8% year over year), and adjusted EPS was $2.25 (up 9%), above the high end of prior guidance. Growth was led by Aerospace Technologies, with organic sales up 18%, including double-digit growth in both commercial aviation and defense and space.

Backlog rose 6% year over year to a record $32.0 billionc on $10.2 billion of orders. The weaker areas were Industrial Automation, with organic sales down 13% and segment margin down 200 basis points to 16.8%, and Building Automation, with organic sales down 3%. Energy and Sustainability Solutions grew 5% organically but saw segment margin contract 70 basis points.

Cash flow was modest for the quarter: operating cash flow was $448 milliond and free cash flow was $215 million, compared with negative figures in the prior-year period. Management reiterated full-year 2024 guidance, including sales of $38.1 billion to $38.9 billion, adjusted EPS of $9.80 to $10.10, and free cash flow of $5.6 billion to $6.0 billion. Balance sheet activity was significant.

Long-term debt increased to $22.2 billion from $16.6 billion, mainly reflecting a $5.7 billion debt issuance, and cash rose to $11.8 billion. The company also deployed $1.6 billion across dividends, share repurchases, and capital expenditures, and announced its intention to acquire Civitanavi Systems to strengthen its aerospace navigation business. The filing furnishes the press release under Item 2.02, so it is not deemed filed for Exchange Act purposes.

02—Key points

Key Highlights

  1. Q1 2024 sales of $9.1B, up 3% reported and 3% organically; EPS of $2.23 (up 8%) and adjusted EPS of $2.25 (up 9%), above the high end of prior guidance.
  2. Operating margin expanded 130 bps to 20.4%; segment margin rose 20 bps to 22.2%, led by Aerospace Technologies.
  3. Aerospace Technologies organic sales grew 18% with segment margin up 150 bps to 28.1%, its seventh straight quarter of double-digit organic growth.
  4. Industrial Automation organic sales fell 13% and segment margin contracted 200 bps to 16.8%, the main drag on the quarter.
  5. Record backlog of $32.0B, up 6% year over year, on $10.2B of orders.
  6. Full-year 2024 guidance reiterated: sales of $38.1B–$38.9B, adjusted EPS of $9.80–$10.10, and free cash flow of $5.6B–$6.0B.
  7. Long-term debt rose to $22.2B from $16.6B after a $5.7B issuance; cash increased to $11.8B. Announced intent to acquire Civitanavi Systems.

03—Questions

Frequently Asked Questions

  1. Did Honeywell meet its first-quarter 2024 expectations?

    Yes. The company said results met or exceeded its guidance. Adjusted EPS of $2.25 was above the high end of previous guidance, and operating and segment margins both expanded year over year.

  2. Which business drove growth, and which lagged?

    Aerospace Technologies drove growth, with organic sales up 18% and segment margin up 150 bps to 28.1%. Industrial Automation was the main laggard, with organic sales down 13% and segment margin down 200 bps to 16.8%, reflecting lower warehouse and workflow volumes.

  3. Did management change full-year 2024 guidance?

    No. Management maintained all full-year guidance, including sales of $38.1B–$38.9B, organic growth of 4%–6%, segment margin of 23.0%–23.3%, adjusted EPS of $9.80–$10.10, and free cash flow of $5.6B–$6.0B.

  4. How strong is the cash flow and balance sheet picture?

    Q1 operating cash flow was $448M and free cash flow was $215M, a sharp improvement from negative figures a year earlier. Debt increased to $22.2B in long-term debt, mainly from a $5.7B issuance, while cash rose to $11.8B. Investors may want to track how the company uses this liquidity for buybacks, dividends, and acquisitions.

  5. What does the announced Civitanavi acquisition mean for Honeywell?

    Management said the planned acquisition of Civitanavi Systems will strengthen Honeywell's navigation offerings within Aerospace and expand its footprint in Europe. The filing does not disclose the purchase price or deal terms, so their impact on financials remains unknown.

04—Continue

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