United Technologies Corp cut its 2009 profit target by about 13 percent and said it would eliminate 11,600 jobs as it no longer anticipates an economic recovery this year.
The world's largest maker of elevators and air conditioners said on Tuesday it expects to earn $4 to $4.50 per share in 2009, lower than the $4.65 to $5.15 per share it previously forecast.
Analysts were looking for profit of $4.60 per share, according to Reuters Estimates.
The economic recovery previously anticipated in the second half of 2009 now appears unlikely, said Louis Chenevert, chief executive of the Hartford, Connecticut-based company.
Its shares rose 1.8 percent in pre-market trading as Wall Street welcomed a more measured view of the economy. United Tech's prior profit forecast had been above analysts' consensus.
Honesty is the best policy, said Peter Klein, senior portfolio manager at Fifth Third Asset Management in Cleveland, Ohio, which owns United Tech shares. The more you can get ahead of the ball, rather than behind it, you're going to get ahead in this marketplace.
The company said it anticipates $750 million in restructuring costs this year, which will be partly offset by $200 million to $350 million in one-time gains. All told, one-time items will weigh profits by 30 cents to 40 cents per share for the year.
United Tech, which also makes jet engines and Sikorsky helicopters, now looks for revenue of $55 billion this year, down from a prior forecast of about $57 billion. It said it would cut its planned budget to repurchase shares by half to $1 billion.
As of December, United Tech employed about 220,000 people.
United Tech's competitors include Eurocopter, a unit of EADS
Its shares rose to $38.25 in early electronic trading, up
from a $37.56 close on the New York Stock Exchange. Over the past year they have fallen 44 percent, in line with the 45 percent slide of the Dow Jones industrial average. <.DJI>
(Reporting by Scott Malone; Editing by Steve Orlofsky)