Rockwell Collins sees 7 percent increase in second quarter earnings

CEDAR RAPIDS - Rockwell Collins' second quarter earnings beat analysts expectations but fell short on revenues.

The Cedar Rapids-based avionics and communications company on Thursday reported second quarter earnings from continuing operations increased 7 percent from the prior year, $1.30 per share compared with $1.22 in 2015. However, total sales decreased 2 percent to $1.31 billion.

'Fiscal 2016 is progressing directionally as we expected,” said Kelly Ortberg, Rockwell Collins chairman, president and chief executive officer. 'We anticipated the slow start in the first half of the year followed by expected growth in the second half. Our execution in the second quarter was solid as we focused on delivering the savings from our restructuring actions taken in the first quarter. Our full year guidance remains unchanged as we now focus on delivering the second half growth.”

Ortberg told The Gazette the company expects to see more growth in the second half of the fiscal year as military budgets are starting to improve and the large airplane business - Boeing and Airbus - remains strong.

Aftermarket - services and supports - sales increased, Ortberg said, due to companies and governments keeping planes longer and needing upgrades.

'It's a little lumpy in terms of when that growth comes in,” he said. 'It depends on when we release a new product.”

The company continued to see major growth oversees, and has been selected to supply equipment to Azul Brazilian Airlines, Air France Industries, Singapore-based Tigerair and India-based GoAir.

Ortberg said the company has set a goal of having 50 percent of sales be outside of the U.S. by 2020.

'We have seen significant growth in the after market segment as well as defense and commercial,” he said.

Overall, the second quarter was stable, Ortberg said, with earnings coming out as expected.

'There were also several significant accomplishments this quarter that support our long-term growth objectives,” he said. 'We were selected as one of the suppliers for the HMS Manpack program and we're pleased to be a supplier to Northrop Grumman on the Long Range Strike Bomber. We also captured numerous contract awards for our avionics and information management systems.”