Rockwell Collins Inc. (COL) reduced the upper range of its earnings forecast for the current fiscal year. The company now expects EPS of $3.70 to $3.75 compared to its earlier projection of $3.70 to $3.90.
The downside in guidance was on account of the inclusion of approximately a $20 million ($12 million after-tax, or 8 cents per share) charge for facility consolidation, asset impairments and other restructuring activities. The charges were related the closure of San Jose, California, facility related relocation of engineering and production work to other facilities and trimming of work force.
The company now expects revenues to be approximately $4.5 billion for the current fiscal year, down from the earlier guidance of $4.55 billion. Total segment operating margins are now expected to be between 21% and 21.5%, compared to a prior view of 21%.
For fiscal 2010, Rockwell Collins expects revenues to be in the range of $4.6 billion to $4.8 billion, EPS in the range of $3.35 to $3.55, and cash flow from operations between $600 million and $700 million. Total segment operating margins are expected to be in the range of 18.5% to 19.5%.
Headquartered in Cedar Rapids, Iowa, Rockwell Collins engages in the design, production, and support of communications and aviation electronics for military and commercial customers worldwide. It operates through two business segments. The Commercial Systems segment caters to commercial businesses and regional aircraft manufacturers, commercial and regional airlines, and business jet owners/operators. The Government Systems segment provides communication and electronic systems, products and services for airborne and surface applications to the U.S. Department of Defense, other government agencies, civil agencies, defense contractors and foreign ministries of defense.
We maintain our market Neutral recommendation on the shares.
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