- Revenue growth of $285 million, up 7.6% from prior year
- The new Citation Longitude enters service with 13 aircraft deliveries in the quarter
- EPS of $0.87; adjusted EPS of $1.11, excluding fourth quarter special charges
- 2020 full-year EPS outlook of $3.50 - $3.70
PROVIDENCE, R.I. — (BUSINESS WIRE) — January 29, 2020 — Textron Inc. (NYSE: TXT) today reported fourth quarter 2019 net income of $0.87 per share. Adjusted net income, a non-GAAP measure that is defined and reconciled to GAAP in an attachment to this release, was $1.11 per share for the fourth quarter of 2019, compared to $1.15 per share in the fourth quarter of 2018. Adjusted net income for 2019 excludes $72 million of pre-tax special charges ($0.24 per share, after-tax) recorded in the fourth quarter, primarily related to restructuring activities announced in December 2019.
Full-year 2019 net income was $3.50 per share. Full-year 2019 adjusted net income, a non-GAAP measure, was $3.74 per share, up from $3.34 in 2018.
“Textron Aviation saw double digit revenue growth in the quarter driven largely by initial deliveries of our new Citation Longitude, reflecting our continued investment in new products,” said Textron Chairman and CEO Scott C. Donnelly. “We also saw growth from strong commercial volume at Bell.”
Net cash provided by operating activities of continuing operations of the manufacturing group for the full year was $960 million, compared to $1,127 million last year. Manufacturing cash flow before pension contributions, a non-GAAP measure that is defined and reconciled to GAAP in an attachment to this release, was $642 million compared to $784 million last year.
For the full year, Textron returned $503 million to shareholders through share repurchases.
Textron is forecasting 2020 revenues of approximately $14 billion, up from $13.6 billion. Textron expects full-year 2020 earnings per share will be in the range of $3.50 to $3.70.
The company is estimating net cash provided by operating activities of continuing operations of the manufacturing group will be between $1,010 million and $1,110 million and manufacturing cash flow before pension contributions (a non-GAAP measure) will be between $700 million and $800 million, with planned pension contributions of about $50 million.
Fourth Quarter Segment Results
Revenues at Textron Aviation of $1.7 billion were up 11%, primarily due to higher volume and mix, largely reflecting the Longitude’s entry into service.
Textron Aviation delivered 71 jets, up from 63 last year, and 59 commercial turboprops, down from 67 last year.
Segment profit was $134 million in the fourth quarter, down from $170 million a year ago, primarily due to the mix of products sold and an unfavorable impact from inflation, net of pricing.
Textron Aviation backlog at the end of the fourth quarter was $1.7 billion.
Bell revenues were $961 million, up 16% from $827 million last year, primarily on higher commercial volume.
Bell delivered 76 commercial helicopters in the quarter, up from 46 last year.
Segment profit of $118 million was up $10 million, largely on the higher commercial volume.
Bell backlog at the end of the fourth quarter was $6.9 billion.
Revenues at Textron Systems were $399 million, up 16% from $345 million last year, primarily due to higher volume.
Segment profit of $33 million was down from $37 million last year, due to unfavorable performance, partially offset by higher volume and mix.
Textron Systems’ backlog at the end of the fourth quarter was $1.2 billion.
Industrial revenues were $927 million, a decrease of $81 million from last year, largely related to lower volume and mix primarily at Textron Specialized Vehicles, principally reflecting a shift in the timing of snow sales to the third quarter of 2019.
Segment profit was down $29 million from the fourth quarter of 2018, largely due to volume and mix at Kautex and the lower volume at Textron Specialized Vehicles, partially offset by favorable performance.
Finance segment revenues were up $1 million, and profit was up $2 million from last year’s fourth quarter.
Conference Call Information
Textron will host its conference call today, January 29, 2020 at 8:00 a.m. (Eastern) to discuss its results and outlook. The call will be available via webcast at www.textron.com or by direct dial at (844) 721-7241 in the U.S. or (409) 207-6955 outside of the U.S.; Access Code: 4252363.
In addition, the call will be recorded and available for playback beginning at 10:30 a.m. (Eastern) on Wednesday, January 29, 2020 by dialing (402) 970-0847; Access Code: 2549478.
A package containing key data that will be covered on today’s call can be found in the Investor Relations section of the company’s website at www.textron.com.
About Textron Inc.
Textron Inc. is a multi-industry company that leverages its global network of aircraft, defense, industrial and finance businesses to provide customers with innovative solutions and services. Textron is known around the world for its powerful brands such as Bell, Cessna, Beechcraft, Hawker, Jacobsen, Kautex, Lycoming, E-Z-GO, Arctic Cat, Textron Systems, and TRU Simulation + Training. For more information visit: www.textron.com.
Certain statements in this release and other oral and written statements made by us from time to time are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which may describe strategies, goals, outlook or other non-historical matters, or project revenues, income, returns or other financial measures, often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “guidance,” “project,” “target,” “potential,” “will,” “should,” “could,” “likely” or “may” and similar expressions intended to identify forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from those expressed or implied by such forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update or revise any forward-looking statements. In addition to those factors described in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q under “Risk Factors”, among the factors that could cause actual results to differ materially from past and projected future results are the following: Interruptions in the U.S. Government’s ability to fund its activities and/or pay its obligations; changing priorities or reductions in the U.S. Government defense budget, including those related to military operations in foreign countries; our ability to perform as anticipated and to control costs under contracts with the U.S. Government; the U.S. Government’s ability to unilaterally modify or terminate its contracts with us for the U.S. Government’s convenience or for our failure to perform, to change applicable procurement and accounting policies, or, under certain circumstances, to withhold payment or suspend or debar us as a contractor eligible to receive future contract awards; changes in foreign military funding priorities or budget constraints and determinations, or changes in government regulations or policies on the export and import of military and commercial products; volatility in the global economy or changes in worldwide political conditions that adversely impact demand for our products; volatility in interest rates or foreign exchange rates; risks related to our international business, including establishing and maintaining facilities in locations around the world and relying on joint venture partners, subcontractors, suppliers, representatives, consultants and other business partners in connection with international business, including in emerging market countries; our Finance segment’s ability to maintain portfolio credit quality or to realize full value of receivables; performance issues with key suppliers or subcontractors; legislative or regulatory actions, both domestic and foreign, impacting our operations or demand for our products; our ability to control costs and successfully implement various cost-reduction activities; the efficacy of research and development investments to develop new products or unanticipated expenses in connection with the launching of significant new products or programs; the timing of our new product launches or certifications of our new aircraft products; our ability to keep pace with our competitors in the introduction of new products and upgrades with features and technologies desired by our customers; pension plan assumptions and future contributions; demand softness or volatility in the markets in which we do business; cybersecurity threats, including the potential misappropriation of assets or sensitive information, corruption of data or, operational disruption; difficulty or unanticipated expenses in connection with integrating acquired businesses; the risk that acquisitions do not perform as planned, including, for example, the risk that acquired businesses will not achieve revenue and profit projections; and the impact of changes in tax legislation.