(Reuters) - Textron Inc (TXT.N) reported lower-than-expected quarterly revenue, hurt by a decline in sales in its aviation and Bell helicopter businesses, and the company lowered full-year earnings forecast to reflect its Arctic Cat Inc acquisition.
Textron’s shares fell as much as 3.2 percent to $45.85 in early trading.
The company said revenue in its aviation business, which makes the Cessna business jets, fell 11 percent in the first quarter ended April 1, partly due to lower commercial turboprop aircraft volumes.
The Providence, Rhode Island-based company delivered 12 King Air turboprop aircraft, down from 26 a year earlier. However, volumes of Cessna Citation business jets were up by 1 unit at 35 aircraft.
King Air deliveries fell as customers in some international markets deferred their purchase due to economic uncertainty and strength of the dollar, Chief Executive Scott Donnelly said on a conference call with analysts on Wednesday.
“It’s just been tough selling on the King Air front, so we only had three international deliveries of King Airs,” Donnelly said, adding that the company took the hit on its volumes rather than lowering the price on these aircraft.
However, he reaffirmed the aviation unit’s 2017 revenue forecast to be flat at about $5 billion.
Textron said in January that it would spend less on its aviation business in 2017 due to weak business jet demand.
Demand for corporate jets has been subdued as companies, oil tycoons and billionaires tighten their purse strings amid an uncertain global economy.
Backlog at the aviation business, Textron’s second-biggest business in the first quarter, was $1 billion, about flat from a year earlier.
Textron on Wednesday reduced its 2017 adjusted earnings forecast to $2.40-2.60 per share, from $2.50-$2.70, due to costs related to the Arctic Cat deal, which closed last month. (bit.ly/2oN4bkM)
Analysts on average were expecting 2017 earnings of $2.57 per share, according to Thomson Reuters I/B/E/S.
Revenue in its Bell helicopter business declined 14.4 percent due to lower deliveries of H-1 helicopters to the U.S. government, which Textron said was a “timing issue”.
On an adjusted basis, Textron earned 46 cents per share from continuing operations, 1 cent above the average analyst estimate.
Total revenue fell 3.4 percent to $3.09 billion, below analysts’ expectations of $3.17 billion.
Reporting by Ankit Ajmera in Bengaluru; Editing by Maju Samuel