Rockwell Collins reports 14% higher earnings, raises dividend

Rockwell Collins's Thursday announced 14 percent higher earnings in the company's second fiscal quarter and lowered its sales growth projections for the remainder of the year.

Rockwell Collins sweetened the picture by raising its quarterly dividend by 25 percent effective in the third quarter, based on confidence in its future cash flow and earnings.

The balance of the company's business continued to shift toward demand for commercial aerospace electronics in the quarter, as sales in that segment rose 7 percent compared to a 12 percent drop in defense market sales.

"Both business segments are expected to experience growth in the second half of the year, but at a lower level that previously expected," company chairman, president and CEO Clay Jones said.

The aviation and defense electronics company reported net income of $161 million, up from $150 million in the second quarter of 2011.

On a per-share basis, earnings climbed 13 cents from the second quarter of fiscal 2011, to $1.09.

Despite expectations of slowing sales growth, Jones said the company still expects to meet full-year earnings projections of $4.40 to $4.60 per share due to its ability to control costs.

The crucial original equipment aircraft market saw improvement due to higher deliveries for the Bombardier Global aircraft platform and increased sales to the AirBus A320, Boeing 777 and Boeing 747-8. Aftermarket sales increased 9 percent.

On the defense side, avionics sales increased 4 percent or $13 million. They were more than offset by declines in sales of communications products, surface solutions and navigation products. Surface solution sales were affected by the termination of two defense programs, and navigation product sales fell due to lower delivery rates for Defense Advanced GPS receivers.