http://www.morningstar.com/earnings/18411198-textron-inc-txt-q3-2010.aspx

Textron Inc TXT
Q3 2010 Earnings Call Transcript

Transcript Call Date 10/20/2010

Operator: Ladies and gentlemen, thank you for standing by. Welcome to the Textron Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions). As a reminder, this conference is being recorded.

I would now like to turn the conference over to our host, Vice President of Investor Relations, Mr. Doug Wilburne. Please go ahead, sir.

Douglas R. Wilburne - VP, IR: Thanks, Greg and good morning, everyone. Before we begin, I'd like to mention we will be discussing future estimates and expectations during our call today. These forward-looking statements are subject to various risk factors, which are detailed in our SEC filings and also in today's press release.

On the call today, we have Scott Donnelly, Textron's President and CEO; and Frank Connor, Textron's Chief Financial Officer. We're originating today's call from the National Business Aviation Association conference in Atlanta, as Scott and Frank are here being with customers and industry participants. Our customary earnings call presentation can be found in the Investor Relations section of our website.

Moving now to third quarter results, which appear on Slide 3 of the presentation, revenues in the quarter were $2.5 billion, down 2.7% from a year ago, which yielded a GAAP loss per share from continuing operations of $0.17. This compares to income of $0.02 per share a year ago.

During the quarter, we recorded $0.30 in special charges, $0.25 of this amount related to the wind down of TFC's Canadian operation, which we discussed on our second quarter call. This non-cash charge eliminated the balance of a cumulative currency translation account, which was triggered because TFC's Canadian operation reached a substantially liquidated basis during the quarter. The remaining $0.05 of special charges was related to restructuring cost.

Third quarter earnings from continuing operations, excluding these charges, were up $0.13 per share compared to $0.12 a year ago. Manufacturing operations generated $157 million in free cash flow during the quarter bring the year-to-date amount to $174 million, which compares to last year's nine-month cash flow of $68 million.

With that, I'll turn the call over to Scott.

Scott C. Donnelly - Chairman and CEO: Thanks, Doug, and good morning, everyone. Since we're all here at NBAA, let me just reflect briefly on the mood of the show. I would say that generally speaking customers appear to be more optimistic and positive than they were a year ago at the show.

Many customers, as you talk to them, are reaching a point now where they are a year or two beyond when their normal replacement and upgrade cycle would be. So I think we have a fair number of customers that are genuinely looking at getting back into the market. So while I'd say it's probably too early to conclude whether this really will be a turning point in the business jet order environment, we are encouraged by the level of customer interest.

The recently passed U.S. Bonus Depreciation Bill is certainly a positive factor and we'll see how much this helps to drive sales. As we all know a new product announcements also stimulate demand in the business jet market. In that regard, we unveiled our new Citation Ten aircraft earlier this week and is generating significant attention at the show.

Read our Earnings Call Transcript disclaimer.
Add a Comment
E-mail me new replies.