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How Honeywell’s Safety and Productivity Solutions Did in 1Q18



Safety and Productivity Solutions in 1Q18

Honeywell International’s (HON) SPS (Safety and Productivity Solutions) segment is its smallest revenue contributor, accounting for 13.9% of its total revenue in 1Q17 and 1Q18. SPS revenue rose ~9.4% YoY (year-over-year) to $1.5 billion in 1Q18 from $1.3 billion.

The segment’s overall revenue growth was driven by organic sales growth (6%) and foreign currency translation (3%). Honeywell Intelligrated continued its strong run with new orders, and sensing and scanning volumes grew, especially in China and India.

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Net income and margin

Between 1Q16 and 1Q17, the SPS segment’s net income rose 19% to $231.0 million from $194.0 million due to higher volumes and productivity, which reflected in the segment’s margin. The segment’s net profit margin expanded 130 basis points to 16.0% in 1Q18 from 14.7% in 1Q17.


SPS revenue is expected to continue to grow on the strength of Intelligrated backlogs and the sensing business. The segment’s margin could continue to expand due to higher volumes.

Investors seeking indirect exposure to Honeywell could consider the iShares Global Industrials ETF (EXI), which has invested 2.5% of its portfolio in Honeywell. The fund’s other holdings include 3M (MMM), General Electric (GE), and Boeing (BA), which had weights of 2.9%, 2.8%, and 4.1%, respectively, as of April 20.


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