United Tech: Goodrich deal boosts 2012 revenue

HARTFORD, Conn. (AP) - United Technologies Corp.'s acquisition of Goodrich Corp. could push its revenue up 10 percent next year but will not add to profit until 2013, its chief executive said Thursday.

Louis Chenevert, CEO of the parent company of Sikorsky Aircraft, Otis elevator and other businesses, told analysts at the company's annual outlook meeting in New York that the $16.4 billion Goodrich acquisition is a "transformational deal."

The acquisition, which is expected to close in mid-2012, could boost next year's revenue to $64 billion, up from $58 billion expected this year, he said. Net income of $5.30 to $5.50 per share would compare with $5.47 per share in expected for 2011.

Analysts surveyed by FactSet expect 2012 earnings of $5.89 per share and revenue of $62.8 billion.

The Goodrich deal, which is expected to close in mid-2012, is not expected to add to profit until 2013, Chenevert said. The acquisition will also have the effect of diluting next year's earnings by about 40 cents per share, he said.

Per share earnings could be additionally weighed by the company's decision to not buy back shares.

Edward Jones analyst Matt Collins said the outlook is "not a lot to get excited about."

"Either way, it's a pretty big drag whether you're looking at the lack of share buyback or earning dilution," he said. "They're making a big bet here that the commercial aerospace cycle will pay off."

When United Technologies announced in September it will buy Charlotte, N.C.-based Goodrich, it said the aerospace and defense company will be a perfect addition that will allow it to take advantage of rapidly growing demand for aircraft components.

United Technologies also is increasing restructuring costs to $300 million this year due to the weak global economy.

Chenevert said that despite strong holiday sales and improved U.S. consumer sentiment, housing and employment remain very weak.

In Europe, "the sentiment is deteriorating as we speak," he said.

United Technologies expects weak markets at several of its businesses, including weak airline profits and falling U.S. military spending.

The conglomerate's businesses include jet engine maker Pratt & Whitney, aerospace components manufacturer Hamilton Sundstrand and heating and cooling equipment maker Carrier, which is tied to residential and commercial building construction.

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