Honeywell Fizzles as Industrial Giant Grapples With Covid-19 Fallout

Honeywell reports a sharp drop in first-quarter sales as the coronavirus crisis takes a toll on its global operations.
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Shares of Honeywell International  (HON) - Get Report fell Friday, with better-than-expected earnings offset by a sharp drop in sales amid the coronavirus crisis.

The  defense contractor and industrial conglomerate also yanked its full-year guidance for 2020.

Honeywell's stock price slid 4.06% to $136.07 a share in premarket trading after the corporate giant, whose subsidiaries range from aerospace to building technologies, reported first-quarter earnings per share of $2.21 on net income of $1.53 billion.

That beat the $1.96 a share estimate of analysts surveyed by FactSet, while also ringing in 15% higher than the $1.92 a share, on net income of $1.42 billion, the company reported during the first three months of 2019.

However, Honeywell reported a 5% drop in sales to $8.46 billion, falling short of the $8.59 billion estimate of analysts.

A range of factors combined to put a dent in Honeywell's first-quarter sales, said Darius Adamczyk, the company's chairman and CEO, in a press statement.

As the impact of the coronavirus epidemic intensified, Honeywell "faced headwinds across businesses, including rapid changes in our supply chain, constraints at customer sites, and significant impacts on the commercial aerospace and oil and gas end markets."

Honeywell also said it was suspending its guidance on its full-year 2020 results "until the economic impact of COVID-19 stabilizes," with the industrial conglomerate bracing for "topline challenges ... particularly in the aerospace and oil and gas sectors."

Honeywell also noted that it had $9 billion in cash and short-term investments on hand at the end of March.