Honeywell International Inc (NYSE:HON), a major manufacturer of aircraft electronics and climate control systems, reported a 5 percent fall in quarterly revenue on Friday, hurt by the sale of its friction materials business and a strong dollar.
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The company also cut its full-year revenue forecast to $39 billion-$39.6 billion from $40.5 billion-$41.1 billion, below the average analyst estimate of $40.52 billion, according to Thomson Reuters I/B/E/S.
Honeywell gets more than half its revenue from international operations and exports. The dollar <.DXY> rose 9 percent against a basket of currencies in the first three months of the year.
The company sold its friction materials business, which makes auto parts such as drum brake linings, hydraulic components and brake fluid, to Federal Mogul for about $155 million last year.
Honeywell's transportation unit, which included the friction materials business, accounted for about 10 percent of total revenue in 2013.
Sales in the company's aerospace business — its largest — fell 6 percent to $3.61 billion in the first quarter, while sales at its automation and controls business fell 3 percent.
Excluding the impact of the dollar and the sale of the friction materials business, sales in the aerospace business rose 1 percent.
Revenue for the first quarter fell to $9.21 billion, missing the average analyst estimate of $9.48 billion.
Net income attributable to Honeywell rose to $1.12 billion, or $1.41 per share, in the first quarter ended March 31, from $1.02 billion, or $1.28 per share, a year earlier.
Total expenses fell 7.5 percent, while margins improved to 18.7 percent from 16.5 percent due to new product launches and cost cuts, the company said.
Honeywell also raised the lower end of its full-year profit forecast to $6.00-$6.15 per share from $5.95-$6.15.
Up to Thursday's close of $103.92, the company's shares had risen 4 percent this year. The stock was down marginally in light premarket trading.
(Reporting by Rohit T. K. in Bengaluru; Editing by Simon Jennings)