Rockwell Collins [COL] on Friday introduced financial guidance for 2014 with the declines paced by continued constraints on government spending, partially offset by growth in avionics for commercial aircraft.
The forecast excludes the company’s pending acquisition of ARINC Inc., a provider of communications and information processing solutions for the commercial aviation industry, which is expected to have $600 million in sales in 2013.
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| Rockwell Collins flight cabin displays. Photo: Rockwell Collins |
Kelly Ortberg, Rockwell Collins’ president and CEO, said the budget sequestration “is here to stay.” Still, he believes that the company’s defense business will begin to firm up in another year.
“Looking out longer-term, I remain confident that our plan will return the company to growth in fiscal 2015 with defense stabilizing, a continue robust air transport market and the benefits of new aircraft entering into service across our commercial markets,” Ortberg said in a statement. “Moreover, the pending acquisition of ARINC creates a whole new growth platform for Rockwell Collins, enabling us to capitalize on the fast-growing information management market.”
The company’s Commercial Systems segment is expected to see revenues increase in the mid-single digits over 2013 while the Government Systems business expects declines in the mid- to high-single digits.
Overall, operating margins are expected to range between 21 percent and 22 percent, with Government Systems stable at above 20 percent and Commercial Systems expanding a half-percent.
Earnings per share from continuing operations in 2014 are expected to be between $4.30 and $4.50 versus between $4.55 and $4.60 in 2013. Total sales next year are forecast to be in the range of $4.5 billion to $4.6 billion versus nearly $4.7 billion in 2013.