Textron‘s [TXT] second quarter 2019 financial results were mixed, as the company reported $3.2 billion in revenue, $500 million lower than last year, but earnings per share of $.93, compared to $.87 last year.
CEO Scott Donnelly told financial analysts in a July 17 conference call that he expects business to pick up in the third and fourth quarters of this year, including sales of Bell 407 and 429 helicopters for commercial customers who use them for such areas as VIP transport and law enforcement. Bell is a Textron subsidiary.
“The demand [for the 407 and 429] is clearly there,” Donnelly said. “Q-2 was a solid quarter for Textron, as we continue our focus on operational improvements across the company. The underlying market is as healthy as it’s been in a very long time.”
June saw a business slowdown for the company amid talk of tariffs on Mexican goods by the Trump administration, Donnelly said.
“There were a couple of specific [business jet] transactions where customers that do a lot of business in Mexico and their business is dependent on that, and they got pretty rattled,” he said.
Textron reported that Bell second quarter revenues were $771 million, down 7 percent from last year, primarily on lower military volume, such as the Bell-Boeing [BA] V-22 tiltrotor, which awaits a third multi-year procurement award. In addition, Bell delivered 53 commercial helicopters in the second quarter, four less than last year.
Last month, the Japan National Police Force ordered its first 412EPX helicopter by Bell and Subaru. The companies are also on contract to build 150 military Bell 412EPI helicopters for the Japanese Ground Self Defense Forces under the UH-X program over the next 20 years. The first UH-X helicopter is scheduled for delivery in 2022.
During the July 17 conference call with financial analysts, Donnelly said ongoing service work and contract opportunities for such programs as the U.S. Marine Corps H-1, V-22, and Marine Air-Ground Task Force Unmanned Aerial System Experimental (MUX) and U.S. Army Future Attack Reconnaissance Aircraft and Future Long Range Assault Aircraft “will drive growth in the future.”