Summary
United Technologies Corporation (UTC), now operating as RTX Corp, presents its 2017 annual report, highlighting a diversified business structure spanning aerospace and commercial sectors. The company operates through four key segments: Otis (elevators/escalators), UTC Climate, Controls & Security (HVAC, fire, security), Pratt & Whitney (aircraft engines), and UTC Aerospace Systems (aerospace components and services). Aerospace businesses represented approximately 50% of sales, with commercial businesses making up the other 50%. International sales were a significant contributor, accounting for 61% of total segment sales in 2017. A pivotal development disclosed is the pending acquisition of Rockwell Collins, announced in September 2017, which is expected to significantly expand UTC's aerospace capabilities. This acquisition, valued at approximately $15 billion for the cash portion, is slated for completion in the third quarter of 2018 and will lead to the creation of a new business unit, Collins Aerospace Systems. To manage the financial impact, UTC has suspended share repurchases, excluding those related to employee savings plans. The company also notes the recent enactment of the Tax Cuts and Jobs Act of 2017, assessing its potential impacts.
Financial Highlights
53 data points| Revenue | $59.84B |
| Cost of Revenue | $31.03B |
| Gross Profit | $28.81B |
| R&D Expenses | $2.43B |
| SG&A Expenses | $6.43B |
| Operating Expenses | $53.06B |
| Operating Income | $8.14B |
| Interest Expense | $909.00M |
| Net Income | $4.55B |
| EPS (Basic) | $5.76 |
| EPS (Diluted) | $5.70 |
| Shares Outstanding (Basic) | 790.00M |
| Shares Outstanding (Diluted) | 799.10M |
Key Highlights
- 1Diversified business model with strong presence in both commercial (Otis, Climate/Controls) and aerospace (Pratt & Whitney, Aerospace Systems) sectors, with each contributing roughly 50% of total sales in 2017.
- 2Significant international revenue stream, with 61% of total segment sales originating from international operations in 2017.
- 3Major pending acquisition of Rockwell Collins announced in September 2017, aimed at bolstering the aerospace segment, with an expected closing in Q3 2018.
- 4Pratt & Whitney's new PurePower PW1000G Geared TurboFan engine family is gaining traction, powering new aircraft like the Airbus A320neo, with significant backlog and development efforts underway.
- 5UTC Aerospace Systems is a key supplier for numerous new aircraft programs, including the Boeing 737MAX-9 and Airbus A330neo, underscoring its role in next-generation aviation.
- 6Company is actively managing financial liquidity for the Rockwell Collins acquisition by suspending share repurchases (except for employee plans).
- 7Ongoing investments in Research & Development, with $2.4 billion spent in 2017, representing 4.0% of total sales, crucial for maintaining a competitive edge in technology-driven industries.