Textron Aviation revenues dip as lower volume outpaces pricing bump
Ground photography of the Cessna Citation Longitude with the new NetJets' paint scheme..Textron West Facility (ICT).Wichita KS USA
Cessna and Beechcraft producer Textron Aviation’s fourth quarter revenues clocked in at $1.5bn, down $58m from the fourth quarter of 2022, reflecting lower volume and mix of $158m despite $100m impact from higher pricing.
The filings showed Textron Aviation made lower jet deliveries of 50 jets in the quarter, down from 52 last year, and 44 commercial turboprops, down from 47 last year.
However, Textron Aviation’s segment profit improved by $23m to $193m during the fourth quarter. The company said the higher profit was due to “a favourable impact from pricing, net of inflation, of $51m, partially offset by lower volume and mix of $22m.”
Textron Aviation backlog at the end of the fourth quarter was $7.2bn.
On a cumulative basis, the Textron Aviation segment posted revenue of $5.4bn in 2023 compared to $5.1bn in 2022 with profits improving to $649m from $560m respectively.
Overall, Textron’s fourth quarter 2023 income from operations clocked in at $1.01 per share, as compared with $1.07 per share in the fourth quarter of 2022. Operating margins witnessed slight erosion during the fourth quarter on account of $126m charges resulting from the implementation of restructuring plan.
“2023 was a strong year at Textron with solid revenue and profit growth along with segment profit margin expansion,” said Scott C. Donnelly, chairman and CEO, Textron. “At Aviation, we saw continued backlog growth and, at Bell, the team began executing on our transformational FLRAA programme.”
The company is eyeing 12-13% growth ($600m) in Textron Aviation revenues during 2024.
“We think the better than expected guidance for 2024 is likely to be the focal point for Textron today. On Aviation the guidance is similar to our forecasts, and we’ll be interested to hear what the company has to say with regard to projected market demand (and the book to bill) and the supply chain,” said Robert Stallard of Vertical Research Partners in his earnings analysis.
